Collective Brands Reports Higher 1Q Profits

The company said foreign currency fluctuations affected $15 million in revenue while ending its sale of Tommy Hilfiger-branded adult footwear cost $23.4 million in sales.

Besides its retail operations, Collective Brands also sells branded footwear wholesale and manages a number of brand license agreements.

Looking ahead, the company didn't provide earnings guidance for the full year but said it will close a net of 60 stores, mostly in the Payless chain. Collective Brands operates more than 4,800 stores.

Rubel warned analysts that the second quarter "will be our toughest quarter of the whole year from a demand standpoint," noting that last year's sales were helped by federal economic stimulus checks.

"(This year) there is no stimulus and there is a recession," he said.

Analysts are expecting second-quarter profit of 42 cents per share on $873.4 million in sales.

The company released its earnings after markets closed Wednesday. During trading, shares fell 25 cents to close at $15.89.