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Retailer Genesco's fiscal 3Q profit sinks 34 pct

The Associated Press

NEWS: Flat sales and added expenses helped drive fiscal third-quarter earnings down 34 percent at Genesco Inc. The specialty retailer said a slow start to the fourth quarter prompted it to lower its forecast for the year.

DETAILS: The Nashville, Tenn., company said Friday that revenue in the quarter that ended Nov. 2 grew less than 1 percent. The shoes, hats, clothing and accessories retailer also said it booked $4 million in expenses in the quarter due to a change in accounting for deferred bonuses and another $3 million tied to an acquisition.

The company's income tax expense also jumped 68 percent to nearly $18 million.

NUMBERS: Overall, Genesco earned $27.8 million, or $1.18 per share, in the quarter ended Nov. 2. That compares to earnings of $42.1 million, or $1.76 per share, in last year's quarter. Revenue edged up to $666.3 million from $664.5 million.

Adjusted earnings from continuing operations totaled $1.43 per share.

Analysts expected earnings of $1.38 per share on $663.6 million, according to FactSet.

FUTURE: The company said sales from established stores in the fourth quarter through Tuesday were flat, and the "retail environment remains somewhat choppy." It now expects annual adjusted earnings of $5.10 to $5.20 per share after forecasting in August $5.20 to $5.30 per share. Analysts expect, on average, $5.20 per share.

STOCK: Company shares fell $1.68, or 2.4 percent, to $69.69 in morning trading. Its shares had been up almost 30 percent so far this year.