(AOF) – Foot Locker, whose action soared 18% in transactions before the opening of Wall Street, raised its forecasts for turnover and profit for this year. The sporting goods retailer, which is buoyed by strong demand from affluent customers, posted net profit for the quarter ended Oct. 29 of $96 million, or $1.01 a share, from $158 million dollars a year ago. Excluding one-time items, adjusted earnings per share were $1.27, versus FactSet consensus of $1.11.
Merchandise inventories rose 29% to $1.69 billion, compared with a 52% increase in the second quarter. For fiscal 2022, the company raised its adjusted EPS guidance range to between $4.42 and $4.50. Sales are expected to fall by 4 to 5%, against a decline of 6 to 7% previously estimated. Like-for-like sales are expected to decline by 4 to 5%.
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big concerns
According to the Federation of specialized trade, Procos, activity from January to May is very significantly down compared to the same period in 2019, at – 8.8%. Store traffic in May 2022 remained lower than in May 2019, but the decline was limited to 6.5%, much better than in April (-19.6% compared to April 2019). In a very uncertain context, several elements weigh on the profitability of companies, in particular the increase in the cost of electricity and the indexation of rents, even if the composition of the ILC (commercial rent index) has been modified. Previously it was composed of 50% inflation, 25% construction cost index and 25% change in retail turnover. From now on, it will only take into account inflation and the cost of construction because the previous formula included sales made by the ‘pure players’ of the Net, which increased the rents of physical stores.