Genesco Q2 beats the Street

British chain's strong growth help drive results

Shoe and hat retailer Genesco said it earned $10.5 million in its second fiscal quarter, reversing a small year-ago loss. Per diluted share, the company earned 44 cents from continuing operations, well above the 27 cents analysts had been looking for.

Revenues at Nashville-based Genesco climbed 15 percent to $544 million. Same-store sales rose 4 percent in the quarter from a year ago, helped by especially strong numbers at the company's Journeys and Schuh divisions. Genesco acquired the latter, which does business in England, last summer.

"We generated significant operating expense leverage on solid sales growth to deliver earnings that were ahead of expectations," said Chairman, President and CEO Bob Dennis. "With August comparable sales up 9 percent, the third quarter is off to an encouraging start. We believe our merchandise assortment is well positioned for the remainder of back-to-school and the upcoming holiday season."

The Genesco team has raised its 2012 guidance for adjusted earnings per share to a range of $4.88 to $5.00, up from the previous range of $4.72 to $4.82. On the company's conference call, CFO Jim Gulmi said the increase adjusts only for the Q2 beat.

Investors bid up Genesco shares (Ticker: GCO) by more than 4 percent in early trading Wednesday, but things settled later in the morning. At about 10:50 a.m., they were up almost 1 percent to about $71.60 on heavy volume. Year to date, they've climbed about 17 percent.