Q2 2024 Foot Locker Inc Earnings Call Transcript
Key Points
- Foot Locker Inc (FL) returned to positive total and comp sales growth in Q2 2024, with comps increasing by 2.6%, led by Foot Locker and Kids Foot Locker banners.
- Gross margin expanded by 50 basis points year-over-year, driven by improved merchandise margins and occupancy leverage.
- The company saw stabilization in the Champs Sports banner, with meaningful comp improvement quarter-over-quarter.
- Foot Locker Inc (FL) is making significant progress with its Lace Up Plan, including strategic investments in store experience, digital, loyalty, and brand building.
- The company is reiterating its full-year outlook, expecting comp growth and EBIT margin expansion, and maintaining its guidance of non-GAAP EPS of $1.50 to $1.70.
- Non-GAAP earnings per share was a loss of $0.05, including a $0.09 impact from a non-recurring FLX charge.
- Foot Locker Inc (FL) is winding down operations in South Korea and closing stores in Denmark, Norway, and Sweden, indicating challenges in these markets.
- The company is reducing capital for new store openings at WSS due to ongoing inflationary pressures impacting discretionary spending.
- Comps in the apparel business were down mid-teens, reflecting a challenging promotional environment.
- The company expects gross margin expansion to be slightly lower than previously anticipated due to promotional pressures in international banners and WSS.
Good morning! And welcome to Foot Locker's second quarter 2024 financial results conference Call. (Operator Instructions)
This conference call may contain forward-looking statements that reflect management's current views or future events and financial performance. Management undertakes no obligation to update these forward-looking statements, which are based on any assumptions and factors, including the effects of global, economic, and market conditions, currency fluctuations, customer preferences, and other risks and uncertainties described more fully in the company's press releases and reports filed with the SEC, including the most recently filed Form 10-K or Form 10-Q.
Any changes in such assumptions or factors could produce significantly different results, and actual results may differ materially from those contained in those forward-looking statements. Please note this conference call is being recorded.
I would now like to turn the conference over to Mr. Robert Higginbotham, Senior Vice President, FP&A, Investor Relations and Treasurer. Sir, you may begin.
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