Foot Locker Sprints Higher on Strong Sales and Profit Outlook

Foot Locker shares sprint higher as the athletic shoe and gear retailer provides a second-quarter sales and earnings update that blows past expectations.
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Foot Locker  (FL) - Get Report shares sprinted higher on Monday after the athletic shoe and gear retailer provided a sales and earnings update for its second quarter that blew past Wall Street expectations.

Shares of Foot Locker jumped more than 23% in premarket trading after the New York-based retailer said it expects to report a surprise fiscal second-quarter profit, as the reopening of stores helped drive a surprise jump in sales.

In a statement, Foot Locker said it expects to report adjusted second-quarter per-share earnings of between 66 cents and 70 cents, well ahead of the 60-cent loss expected by analysts polled by FactSet.

The company said same-store sales for the quarter rose about 18%, compared with the FactSet consensus for a decline of 23.6%.

"As we continued to reopen stores throughout the quarter, we saw a strong customer response to our assortments, which we believe was aided by pent-up demand and the effect of fiscal stimulus," CEO Richard Johnson said in the statement. 

"This fueled our in-store sales and also drove continued momentum across our digital channels,” he added.

Including pretax charges of approximately $19 million related to the wind down of its Runners Point banner and Eastbay restructuring and another $18 million for costs incurred in connection with the recent social unrest, per-share earnings are expected to be between 38 cents and 42 cents, versus 55 cents a year ago.

Shares of Foot Locker were up 7.86% at $29.64 in trading on Monday. The stock had been down approximately 30% year to date through Friday.