Foot Locker reported a 21 percent increase in net income to $520 million for the financial year ended last Jan. 31, representing a net margin of 7.3 percent on total sales of $7,151 million, which were up by 9.9 percent from the previous year. The net margin and the operating margin (Ebit), which improved to 11.4 percent of sales, surpassed the long-term goals set by the previous management.
New goals are going to be announced by the new management, led by Richard Johnson, at a meeting in New York on March 16. The expansion of Foot Locker's European operations, which he led in the past, is expected to be one of his objectives along with the development of the company's women-specific retail formats.
In the past year, the number of Foot Locker stores operating in Europe remained basically flat at 603 doors, after 40 remodels or relocations, and their selling space increased marginally to 846,000 square feet. Same for Runners Point, which ended the year with 116 stores and 143,000 square feet of selling space. Sidestep, on the other hand, moved from 78 to 83 locations with a sales area of 75,000 square feet.
Worldwide, the group had a total of 3,423 stores under different banners in 23 countries, down from 3,473 a year earlier, but their selling space was up slightly to 7,483,000 square feet. At year-end, there were also 51 franchised Foot Locker stores operating in the Middle East and South Korea, as well as 27 franchised Runners Point and Sidestep stores in Germany and Switzerland.
The fourth quarter was part icularly strong for the group, thanks to a 10.2 percent gain in comparable store sales, driven by a 21.9 percent increase in the online business. The European stores' sales rose by a mid-single digit, but they continued to be soft on the lifestyle side. Reported sales went up by 6.7 percent to $1,911 million across the group, rising by 10.1 percent in local currencies. The quarterly net income jumped by 20.6 percent to $146 million, up by 25 percent in terms of earnings per share.
