SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
F O R M 10 - Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 2005
Commission file no. 1-10299
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FOOT LOCKER, INC. |
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(Exact name of registrant as specified in its charter) |
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New York |
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13-3513936 |
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(State or other jurisdiction of incorporation or organization) |
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(I.R.S. Employer Identification No.) |
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112 W. 34th Street, New York, New York |
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10120 |
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(Address of principal executive offices) |
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(Zip Code) |
Registrant’s telephone number: (212) 720-3700
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES x NO o
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). YES x NO o
Number of shares of Common Stock outstanding at May 20, 2005: 156,679,340
FOOT LOCKER, INC.
TABLE OF CONTENTS
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Page No. |
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Part I. |
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Item 1. |
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1 |
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2 |
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3 |
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4 |
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5-10 |
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Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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10-14 |
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Item 4. |
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14 |
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Part II. |
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Item 1. |
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15 |
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Item 2. |
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15 |
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Item 6. |
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15 |
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16 |
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17 |
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PART I - FINANCIAL INFORMATION
FOOT LOCKER, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions, except shares)
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April 30, |
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May 1, |
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January 29, |
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(Unaudited) |
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(Unaudited) |
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* |
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ASSETS |
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Current assets |
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Cash and cash equivalents |
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$ |
146 |
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$ |
224 |
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$ |
225 |
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Short-term investments |
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259 |
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168 |
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267 |
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Total cash, cash equivalents and short-term investments |
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405 |
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392 |
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492 |
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Merchandise inventories |
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1,320 |
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1,051 |
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1,151 |
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Other current assets |
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165 |
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153 |
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189 |
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1,890 |
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1,596 |
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1,832 |
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Property and equipment, net |
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710 |
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664 |
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715 |
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Deferred taxes |
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181 |
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191 |
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180 |
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Goodwill and intangible assets |
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404 |
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232 |
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406 |
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Other assets |
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101 |
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101 |
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104 |
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$ |
3,286 |
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$ |
2,784 |
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$ |
3,237 |
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LIABILITIES AND SHAREHOLDERS’ EQUITY |
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Current liabilities |
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Accounts payable |
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$ |
439 |
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$ |
370 |
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$ |
381 |
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Accrued expenses and other current liabilities |
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318 |
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288 |
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285 |
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Current portion of long-term debt and obligations under capital leases |
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— |
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150 |
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18 |
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757 |
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808 |
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684 |
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Long-term debt and obligations under capital leases |
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347 |
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182 |
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347 |
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Other liabilities |
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299 |
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379 |
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376 |
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1,403 |
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1,369 |
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1,407 |
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Shareholders’ equity |
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Common stock and paid-in capital: 156,766,666, 145,602,460 and 156,155,114 shares, respectively |
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618 |
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431 |
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608 |
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Retained earnings |
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1,432 |
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1,171 |
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1,386 |
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Accumulated other comprehensive loss |
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(165 |
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(183 |
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(162 |
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Less: Treasury stock at cost: 89,326, 178,922 and 63,751 shares, respectively |
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(2 |
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(4 |
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(2 |
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Total shareholders’ equity |
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1,883 |
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1,415 |
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1,830 |
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$ |
3,286 |
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$ |
2,784 |
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$ |
3,237 |
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See Accompanying Notes to Condensed Consolidated Financial Statements.
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* The balance sheet at January 29, 2005 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended January 29, 2005. |
-1-
FOOT LOCKER, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in millions, except per share amounts)
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Thirteen weeks ended |
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April 30, |
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May 1, |
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Sales |
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$ |
1,377 |
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$ |
1,186 |
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Costs and Expenses |
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Cost of sales |
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959 |
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825 |
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Selling, general and administrative expenses |
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283 |
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248 |
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Depreciation and amortization |
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41 |
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35 |
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Interest expense, net |
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3 |
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4 |
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1,286 |
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1,112 |
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Income from continuing operations before income taxes |
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91 |
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74 |
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Income tax expense |
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33 |
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27 |
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Income from continuing operations |
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58 |
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47 |
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Income from disposal of discontinued operations, net of income tax expense of $- |
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— |
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1 |
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Net income |
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$ |
58 |
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$ |
48 |
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Basic earnings per share: |
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Income from continuing operations |
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$ |
0.37 |
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$ |
0.33 |
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Income from discontinued operations |
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— |
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— |
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Net income |
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$ |
0.37 |
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$ |
0.33 |
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Weighted-average common shares outstanding |
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155.1 |
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143.6 |
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Diluted earnings per share: |
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Income from continuing operations |
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$ |
0.37 |
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$ |
0.31 |
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Income from discontinued operations |
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— |
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— |
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Net income |
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$ |
0.37 |
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$ |
0.31 |
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Weighted-average common shares assuming dilution |
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158.1 |
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156.2 |
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See Accompanying Notes to Condensed Consolidated Financial Statements.
-2-
FOOT LOCKER, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
(in millions)
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Thirteen weeks ended |
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April 30, |
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May 1, |
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Net income |
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$ |
58 |
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$ |
48 |
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Other comprehensive expense |
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Foreign currency translation adjustments arising during the period |
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(3 |
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(16 |
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Change in fair value of derivatives / reclassification adjustments, net of tax of $- |
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— |
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— |
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Comprehensive income |
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$ |
55 |
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$ |
32 |
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See Accompanying Notes to Condensed Consolidated Financial Statements.
-3-
FOOT LOCKER, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in millions)
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Thirteen weeks ended |
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April 30, |
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May 1, |
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From Operating Activities: |
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Net income |
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$ |
58 |
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$ |
48 |
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Adjustments to reconcile net income to net cash used in operating activities of continuing operations: |
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Income from disposal of discontinued operations, net of tax |
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— |
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(1 |
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Depreciation and amortization |
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41 |
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35 |
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Deferred income taxes |
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1 |
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6 |
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Change in assets and liabilities: |
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Merchandise inventories |
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(171 |
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(140 |
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Accounts payable and other accruals |
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96 |
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124 |
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Pension contributions |
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(19 |
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(50 |
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Other, net |
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(25 |
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(30 |
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Net cash used in operating activities of continuing operations |
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(19 |
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(8 |
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From Investing Activities: |
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Lease acquisition costs |
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