EXHIBIT 99.1
[FOOT LOCKER, INC. LOGO]
N E W S R E L E A S E
CONTACT: Peter D. Brown
Vice President, Treasurer
and Investor Relations
Foot Locker, Inc.
(212) 720-4254
FOOT LOCKER, INC. REPORTS FIRST QUARTER RESULTS
o Income from Continuing Operations Increased to $0.27 Per Share
o Gross Margin Rate Improves by 120 Basis Points
o Debt, Net of Cash, Decreased by $67 Million from Last Year
o Company Expects its Second Quarter EPS to Meet or Exceed Current
Analysts' Estimates
NEW YORK, NY, May 22, 2003 - Foot Locker, Inc. (NYSE: FL), the New York-based
specialty athletic retailer, today reported financial results for its first
quarter ended May 3, 2003.
Income from continuing operations for the Company's first quarter ended May 3,
2003, increased to $39 million, or $0.27 per share, compared with $38 million,
or $0.26 per share, last year. For the 13-week first quarter period, sales
increased 3.5 percent to $1,128 million this year compared with sales of $1,090
million last year. First quarter comparable-store sales decreased 2.5 percent,
on a constant currency rate basis.
The Company's financial position remains strong with debt, net of cash, of $52
million. This represents a $67 million reduction from the same period last year.
Merchandise inventories remain on plan and well positioned to support the
Company's second quarter sales expectations. During the first quarter of 2003
the Company opened 17 stores, remodeled/relocated 60 stores and closed 42
stores. At May 3, 2003, the Company operated 3,600 stores in 14 countries in
North America, Europe and Australia.
"Our first quarter performance reflects the implementation of a series of
ongoing initiatives designed to make our Company more efficient and which
contributed to our increased earnings," stated Matthew D. Serra, Foot Locker,
Inc.'s President and Chief Executive Officer. "We are encouraged by our first
quarter performance, and in particular by our 120 basis point gross margin rate
improvement. Given this success, we are somewhat more confident in our ability
to increase our future quarter-over-quarter earnings per share, and we currently
expect our second quarter 2003 net income from continuing operations to meet or
exceed the current analysts' consensus estimate of $0.24 per share."
The Company is hosting a live conference call at 10:00 am (EST) on Thursday, May
22, 2003 to review 2003 first quarter results, discuss our 2003 outlook, and
respond to analysts' questions. This conference call may be accessed live from
the Investor Relations section of the Foot Locker, Inc. website at
http://www.footlocker-inc.com. The conference call will be available for webcast
replay until 5:00 pm on Monday, May 26, 2003.
Disclosure Regarding Forward-Looking Statements
This press release contains forward-looking statements, which reflect
management's current views of future events and financial performance. These
forward-looking statements are based on many assumptions and factors detailed in
the Company's filings with the Securities and Exchange Commission, including the
effects of currency fluctuations, customer demand, fashion trends, competitive
market forces, uncertainties related to the effect of competitive products and
pricing, customer acceptance of the Company's merchandise mix and retail
locations, unseasonable weather, risks associated with foreign global sourcing,
including political instability, changes in import regulations and the presence
of severe acute respiratory syndrome, economic conditions worldwide, any changes
in business, political and economic conditions due to the threat of future
terrorist activities in the United States or in other parts of the world and
related U.S. military action overseas, and the ability of the Company to execute
its business plans effectively with regard to each of its business units,
including its plans for the marquee and launch footwear component of its
business. Any changes in such assumptions or factors could produce significantly
different results. The Company undertakes no obligation to update
forward-looking statements, whether as a result of new information, future
events, or otherwise.
Foot Locker, Inc. 112 West 34th Street, New York, NY 10120
FOOT LOCKER, INC.
Consolidated Statements of Operations
(unaudited)
Periods ended May 3, 2003 and May 4, 2002
(In millions, except per share amounts)
First Quarter First Quarter
2003 2002
------ ------
Sales $1,128 $1,090
Cost of sales 783 770
Selling, general and
administrative expenses 241 220
Depreciation and amortization 37 36
Interest expense, net 5 7
------ ------
1,066 1,033
------ ------
Income from continuing
operations before
income taxes 62 57
Income tax expense 23 19
------ ------
Income from continuing
operations 39 38
Loss on disposal of
discontinued operations -- (18)
Cumulative effect of
accounting changes, net
of income taxes (1) --
------ ------
Net income $ 38 $ 20
------ ------
Diluted EPS:
Income from continuing
operations $ 0.27 $ 0.26
Loss on disposal of
discontinued operations -- (0.12)
Cumulative effect of
accounting changes, net
of income taxes (1) (0.01) --
------ ------
Net income $ 0.26 $ 0.14
------ ------
Weighted-average diluted
shares outstanding 151.3 150.9
(1) Related to adoption of SFAS No. 143, "Accounting for Asset Retirement
Obligations."
FOOT LOCKER, INC.
Condensed Consolidated Balance Sheets
(unaudited)
(In millions)
May 3, May 4,
2003 2002
------ ------
Assets
CURRENT ASSETS
Cash and cash equivalents $ 306 $ 278
Merchandise inventories 941 839
Assets of discontinued operations 2 3
Other current assets 90 86
------ ------
1,339 1,206
Property and equipment, net 626 626
Deferred tax assets 233 253
Other assets 333 280
------ ------
$2,531 $2,365
====== ======
Liabilities and Shareholders' Equity
CURRENT LIABILITIES
Accounts payable $ 344 $ 353
Accrued liabilities 254 183
Current liabilities and reserves for restructuring,
discontinued operations and businesses held for sale 21 22
Current portion of long-term debt and
obligations under capital leases -- 32
------ ------
619 590
Long-term debt and obligations under capital
leases 358 365
Other liabilities 401 384
SHAREHOLDERS' EQUITY 1,153 1,026
------ ------
$2,531 $2,365
====== ======
-MORE-
FOOT LOCKER, INC.
Store and Estimated Square Footage
(unaudited)
(Square footage in thousands)
May 3 May 4, February 1 February 2,
2003 2002 2003 2002
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Foot Locker U.S.
Number of stores 1,458 1,476 1,477 1,472
Gross square footage 5,978 6,024 6,043 6,039
Selling square footage 3,469 3,447 3,497 3,442
Lady Foot Locker
Number of stores 600 618 606 632
Gross square footage 1,335 1,389 1,362 1,416
Selling square footage 754 791 781 816
Kids Foot Locker
Number of stores 370 387 377 391
Gross square footage 899 937 912 944
Selling square footage 535 559 547 567
Champs Sports
Number of stores 588 570 582 574
Gross square footage 3,285 3,219 3,262 3,262
Selling square footage 2,305 2,259 2,292 2,280
Foot Locker International
Number of stores 584 531 583 521
Gross square footage 1,645 1,497 1,639 1,482
Selling square footage 922 855 920 837
Total Athletic Group
Number of stores 3,600 3,582 3,625 3,590
Gross square footage 13,142 13,066 13,218 13,143
Selling square footage 7,985 7,911 8,037 7,942
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