Finish Line Q1 Results Top Expectations

Finish Line Inc. FINL announced 30 percent drop in profit for the first quarter as operational costs are higher than the last year first quarter. However, its earnings, as well as the revenue came in above the Street analysts' expectations. The mid-point of earnings guidance for the full year fell short of the predictions.

Finnish Line reported net income of $9.63 million, down 29.9 percent from $13.73 million in the year-ago quarter. Similarly, its earnings fell 23.3 percent to $0.23 from $0.30 in the comparable period. Street analysts predicted the company to earn $0.22 a share.

The company's net sales advanced 2.28 percent to $453.52 million from $443.39 million in the same quarter last year. This is higher than the Street analysts' estimations of $449.56 million. Its comparable store sales grew 1.5 percent.

Finnish Line's CEO, Sam Sato, commented about the results saying, "We delivered first quarter results that were in-line with expectations despite the challenging retail environment. Importantly, we've made further progress toward optimizing our supply chain and improving execution throughout the enterprise."

He added, "We remain focused on successfully executing the strategic initiatives for our Finish Line, Macy's, and JackRabbit businesses while creating an operating model that drives profitable growth and generates shareholder value consistently over the long-term."

The company indicated it bought back one million shares for about $21.3 million in the first quarter. The company added that it still has 1.3 million shares pending on its current Board authorized repurchase program. It closed the quarter with cash and cash equivalents of $85.4 million with no interest-bearing debt.

Moving ahead, Finnish expects earnings to be $1.50 - $1.56 a share in the fiscal year ending February 2017. The company also expects comparable store sales to grow between 3 and 5 percent. Analysts are looking for earnings of $1.54 a share with revenue expected to record 3.4 percent growth.

Following the news, the stock traded 6.02 percent higher in the pre-market on Friday.