=Foot Locker (FL) reported earnings on Fri 2 March 2018 (b/o)

Foot Locker beats by $0.01, reports revs in-line 

• Reports Q4 (Jan) earnings of $1.26 per share, $0.01 better than the Capital IQ Consensus of $1.25. With the benefit of the extra week, total fourth quarter sales +4.6 percent, to $2,210 mln vs $2.23 bln consensus. Excluding the effect of foreign exchange rate fluctuations, total sales for the quarter increased 2.0 percent.
  • Fourth quarter comparable-store sales decreased 3.7 percent
  • On a 14-week basis, the Company's gross margin rate decreased to 31.4 percent from 33.7 percent a year ago, reflecting the continuation of a highly promotional marketplace environment
• The Company currently expects a flat to up low single-digit comparable-store sales performance for fiscal 2018 and gross margins to begin recovering from 2017's 31.6 percent rate, which fell 2.3 percent from the gross margin rate in fiscal 2016.

Co states, "The first quarter of 2018 will likely see the continuation of sales and margins in line with trends in the second half of 2017. However, we are confident that we will inflect back to positive comparable-store sales by the middle of 2018, with the pace of sales continuing to gradually strengthen in the second half of the year based on the improving depth and variety of premium products we see coming from our key vendors. We also expect a double-digit percentage increase in annual earnings per share, with an effective tax rate in the 27 to 28 percent range and a lower share count both contributing to this performance."

• Consensus for FY 18 EPS was $4.54 (+13%)