Finish Line reports fiscal Q3 net earnings of US$1.6M, compared with year-ago loss of US$809,000; net sales up 22.9% to US$364.5M

Nevin Barich

INDIANAPOLIS , December 20, 2013 (press release) – Q3 comp store sales increased 7.1%; Q3 EPS of $0.05; Company Raises Full Year Outlook

The Finish Line, Inc. (NASDAQ: FINL) today reported results for the 13-weeks ended November 30, 2013.

For the thirteen weeks ended November 30, 2013:

Consolidated net sales were $364.5 million, an increase of 22.9% over the prior year period.

Finish Line comparable store sales increased 7.1%.

On a GAAP basis, diluted earnings per share were $0.05.

Non-GAAP diluted earnings per share, which excludes the impact of impairment charges, were $0.06.

“We are very pleased with the top and bottom line performance we delivered in the third quarter,” said Chairman and Chief Executive Officer, Glenn Lyon. “Our commitment to developing a premier omni-channel platform is strengthening both our customer relationships and our brand partnerships while also reinforcing our market leadership position. We are continually adapting and refining our strategies in this rapidly evolving retail landscape to ensure we meet the needs of today’s empowered consumer. Finish Line is on the right strategic course and is well-positioned to deliver on our near and longer term goals.”

Balance Sheet

As of November 30, 2013, consolidated merchandise inventories increased 19.5% to $360.5 million compared to $301.7 million as of December 1, 2012. The increase resulted primarily from the start-up of Macy’s business. For Finish Line, merchandise inventories increased 0.6%.

The company repurchased 200,000 shares of its common stock in the third quarter, totaling $5.2 million. The company has 4.1 million shares remaining on its current Board authorized repurchase plan.

As of November 30, 2013, the company had no interest-bearing debt and $111.9 million in cash and cash equivalents, compared to $168.2 million a year ago.

Outlook

For the fiscal year ending March 1, 2014, Finish Line now expects comparable store sales to increase approximately 3%-4% compared to its previous expectation for a low single digit increase. The Company now expects Non-GAAP earnings per share to increase 9% to 12% to $1.60-$1.65 from fiscal year 2013 Non-GAAP diluted earnings per share of $1.47. This compares to its previous expectation for a mid-single digit increase.

Q3 Fiscal 2014 Conference Call Today, December 20, 2013 at 8:30 a.m.

The Company will host a conference call for investors today, December 20, 2013, at 8:30 a.m. Eastern. To participate in the live conference call, dial 866-923-8645 (U.S. and Canada) or 660-422-4970 (International), conference ID #19771592. The live conference call will also be accessible online at www.finishline.com. A replay of the conference call can be accessed approximately two hours following the completion of the call by dialing 855-859-2056, conference ID #19771592. This recording will be made available through Monday, January 20, 2014. The replay will also be accessible online at www.finishline.com.

Disclosure Regarding Non-GAAP Measures

This report refers to certain financial measures that are identified as non-GAAP. The Company believes that these non-GAAP measures, including gross profit, selling, general and administrative expenses, operating income, net income attributable to The Finish Line, Inc., and diluted earnings per share attributable to The Finish Line, Inc. shareholders, are helpful to investors because they allow for a more direct comparison of the Company’s year-over-year performance and are useful in assessing the Company’s progress in achieving its long-term financial objectives. This supplemental information should not be considered in isolation or as a substitute for the related GAAP measures. A reconciliation of the non-GAAP measures to the comparable GAAP measures can be found in the Company’s Form 8-K filed with the Securities and Exchange Commission with this release.

About The Finish Line, Inc.

The Finish Line, Inc. is a premium retailer of athletic shoes, apparel and accessories. Headquartered in Indianapolis, Finish Line has 658 stores in malls across the U.S., manages the athletic footwear inventory in 660 Macy’s stores including 198 branded or staffed shops, and employs more than 13,000 sneakerologists who help customers every day connect with their sport, their life and their style. Online shopping is available at www.finishline.com and www.macys.com. Mobile shopping is available at m.finishline.com. Follow Finish Line on Twitter at Twitter.com/FinishLine and “like” Finish Line on Facebook at Facebook.com/FinishLine.

Industry Intelligence editor's note: In an omitted table, the company reported fiscal third-quarter 2014 net income of US$1.6 million and net sales of $364.5 million compared to fiscal third-quarter 2013 net loss of $809,000 and net sales of $296.6 million.

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