US' Foot Locker's sales decline 4.6%, to $1,788 mn in Q1
Comparable sales decreased by 2.6 per cent, with comparable sales in the North American region decreasing by 0.5 per cent. Comparable sales in the company's international businesses decreased by 8.5 per cent, led by softness in Foot Locker Europe.
Foot Locker reported Q1 sales of $1.79 billion, down 4.6 per cent y-o-y, with comparable sales falling 2.6 per cent. North America saw a 0.5 per cent drop, while international sales declined 8.5 per cent. Gross margin decreased by 40 basis points, and SG&A rose 100 basis points as a percentage of sales. The company opened 9 stores, closed 56, and updated 80 locations.
Gross margin decreased by 40 basis points as compared with the prior-year period. Merchandise margins decreased by 10 basis points, while occupancy as a percentage of sales increased by 30 basis points as compared to the prior-year period, the company said in a press release.
"We are continuing to execute our Lace Up Plan strategies as we look forward to the successful completion of our transaction with DICK'S Sporting Goods. As we noted at the time we reported preliminary first quarter results, we experienced softer traffic trends globally that impacted our performance. During the quarter, we remained focused on the rollout of our Re-imagined and Refresh programs to elevate our in-store experience, enhancing our digital offerings, deepening customer engagement through our FLX programme and leveraging our strong brand partnerships to generate excitement for our customers. As we have executed these and other initiatives to further advance our strategy, our teams have also remained nimble to navigate the uncertain macroeconomic environment, including managing our promotional levels, inventories, and expenses and remaining disciplined with our cash flows," said Mary Dillon, chief executive officer .
SG&A as a percentage of sales increased by 100 basis points as compared with the prior-year period, due to underlying deleverage on the sales decline and investments in technology which more than offset the cost optimisation programme and ongoing expense discipline. Compared to the prior year, SG&A dollars were down 0.7 per cent.
During the first quarter, the company opened 9 new stores and closed 56 stores, including its stores that operated in South Korea, Denmark, Norway, Sweden, Greece, and Romania. Also during the quarter, the company remodeled or relocated 11 stores and refreshed 69 stores to updated design standards, which incorporate key elements of the current brand design specifications.
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