ATLANTA — Foot Locker said it plans to strengthen its business operations with a number of initiatives that include a possible sale of the $5.75 billion specialty athletic retailer, closing about 250 U.S. stores this year, opening more stores in Europe and naming a new president for Foot Locker U.S.
The company said it had retained Lehman Brothers as an advisor to help evaluate strategic alternatives, including inquiries received from private equity firms.
Keith Daly, president and CEO of Foot Locker Europe since 2005, was promoted to president of Foot Locker U.S., with responsibility for the Foot Locker, Footaction and Kids Foot Locker stores in the U.S. He succeeds Nick Grayston, who is leaving the company, and reports to Richard Mina, president and CEO, Foot Locker, Inc. USA.
The New York-based company, which unsuccessfully attempted to acquire Genesco this past spring, reported a weak first quarter in May, and is about to report an even weaker second quarter. Net income fell more than 70 percent to $17 million in the first quarter, compared to $59 million in the year-ago quarter, and comp-store sales decreased 5.1 percent.
Foot Locker warned that it expects to report a loss in the range of 17 to 20 cents per share in the second quarter, which will be revealed on Aug. 22. It also expects comp-store sales for the quarter to decrease 7 to 8 percent. Foot Locker said the loss reflects increased markdowns in its U.S. stores of approximately $55 million at cost, or approximately 22 cents per share, versus the same period last year to liquidate slow-selling merchandise.
Matthew D. Serra, chairman and CEO, said the primary reason for the projected net loss comes from the company’s decision to liquidate slower-selling merchandise in U.S. stores more aggressively than it had planned in order to improve its inventory position before the fall season starts.
He added that Foot Locker expects international units to product a double-digit division increase in profit. The retailer plans to open up to 30 new stores in the Europe and surrounding markets during fiscal 2008.
The closing of 250 U.S. stores this year is about twice the number of unproductive U.S. units Foot Locker had originally planned to close. Foot Locker said it believes profitability of its U.S. store base will be enhanced as a result.
As part of the key management changes, Dick Johnson, president and CEO of Footlocker.com since 2003, succeeds Daly as president and CEO of Foot Locker Europe. Foot Locker is currently searching for someone to replace Johnson. Dowe Tillema, was promoted to executive vice-president of Footlocker.com and will continue in his role as CFO of the division.
Additionally, Foot Locker confirmed last week that it would shutter its three-month-old Footquarters athletic footwear and apparel operation. The 31 units will be converted into either Foot Locker or Champs Sports outlets.
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye
"Nowadays when life is not so happy with everything going on in the world, I think people come to me for a little bit of whimsy and color and fun." - Designer Rebecca De Ravenel on her cult-favorite jewelry line. (📸 : @vsteves) #wwd40
“Everyone is talking about how the retail industry is struggling, but I think it’s an incredible time because brands who are doing something different and innovative are setting themselves up for the future,” said @adamgoldston, who founded the luxury athletic brand @apl with his brother @ryangoldsten. The Goldston’s are part of WWD’s 40 under 40: a group of industry notables. See the rest of the list on WWD.com. (📷: @vsteves) #wwd40
@eyeswoon blogger Athena Calderone debuted her first-ever cookbook, “Cook Beautiful,” which is heavily centered on the presentation and visual expression of food. Pictured here are her miso glazed carrots from the book. Get the recipe on WWD.com. (📷: @johnny_miller_) #wwdeye
“It’s passion that helps get anybody to a certain point and it’s what’s propelled me,” said Kith founder @ronniefieg, one of WWD’s 40 under 40: a group of industry notables who are changing the face of retail, fashion and beauty. Fieg, who opened a Manhattan flagship on October 7, began his career at age 13 as a stock boy and salesman for footwear chain David Z. “I think staying true to [my] beliefs, hard work and passion have gotten me to where [Kith] is today.” See the rest of the 40 at WWD.com. (📷: @vsteves) #wwd40
25-year-old @samweaving is about to break out this fall, starring in Netflix’s horror film “The Babysitter,” fittingly out today on Friday the 13th. That’s not the only place you’ll be seeing her, though — Weaving’s got a role Showtime’s “SMILF” and another alongside Frances McDormand and Woody Harrelson in “Three Billboards Outside Ebbing, Missouri.” Though she’s got a full plate at the moment, there’s one role she’s got her eye on: Marilyn Monroe. “I’m a little too young at the moment, but it’s on my bucket list,” the actress told WWD (📷: @dandoperalski) #wwdeye
BFF's Poppy Jamie and Suki Waterhouse celebrated the launch of their bag line Pop x Suki at Nordstrom last night. "The line is really about our friendship, and how we are so different but complement each other," said Waterhouse. 👯 (📷: Katie Jones) #wwdeye
After designing the new @louisvuitton and @bulgariofficial flagships and a @chanelofficial boutique opening in Japan, @petermarinoarchitect has another project on his plate: The Lobster Club. Located in the Seagram Building, it’s the famed architect’s first restaurant project in New York, serving up modern Japanese brasserie-style cuisine. Bronze hues, bespoke material detailing, blush and chartreuse tones and a heavy emphasis on Picasso can be seen throughout. Mark your calendars for Nov. 1 for the much-anticipated opening. (📷: @clint_spaulding) #wwdeye