Genesco Inc (NYSE: GCO) shares are down after the company reported Q1 sales of $483 million, down 7% Y/Y, driven by decreased store sales in Journeys Group, decreased wholesale sales, and foreign exchange pressure.
The sales decrease of 7% was driven by a decrease of 13% at Journeys and a 25% or $12 million decrease at Genesco Brands.
Comps are down 5%, with stores down 8% and direct up 7%.
Excluding lower exchange rates, net sales decreased by 6% compared to Q1 FY23.
Adjusted EPS loss from continuing operations was ($1.59) a shift from income of $0.44 reported a year ago.
Mimi Vaughn, Genesco's Board Chair, President & CEO, said, "Following a positive end to the holiday season, the first quarter proved considerably more challenging than we anticipated. Consumer demand at Journeys dropped off significantly early in the quarter and did not improve as we changed seasons in the latter part of March and into April, offsetting another quarter of record sales at Schuh and Johnston & Murphy."
Guidance: For Fiscal 2024, Genesco sales are to fall 4% to 5%, or down 5% to 6%, excluding the 53rd week this year, compared to FY23. It expects adjusted EPS of $2.00-$2.50, almost half from $5.10-$5.90 prior guidance.
Earlier, the company expected the sales to be flat to up 2%, or down 1% to up 1%, excluding the 53rd week.
It expects to close more than 100 Journeys stores in Fiscal 2024, versus prior expectations to close 60 stores.
It foresees up to $40 million in cost reductions versus $20 million to $25 million prior, with $20 million realized in FY24.
Price Action: GCO shares are down 27.9% at $21.45 on the last check Thursday.
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This article Specialty Retailer Genesco Stock Tumbles After Q1 Loss: Here's Why originally appeared on Benzinga.com
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