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Genesco Closing Stores

It sees a first-quarter shortfall.

Genesco (GCO) - Get Genesco Inc. Report slashed first-quarter earnings guidance and said it would close 57 stores.

The Nashville, Tenn., shoes-and-hats retailer said it expects to make 9 to 12 cents a share for the quarter ended May 5, well below previous guidance of 28 cents a share. The company said it expects to report same-store sales growth of approximately 3% for the Journeys Group and 4% for Johnston & Murphy retail, and same-store declines of 4% for the Hat World Group and 22% for the Underground Station Group for the quarter.

As a result, Genesco will close 57 stores, mostly in the Underground Station group but including up to 8 in the Hat World group. The company says on its Web site that Underground Station currently has more than 175 stores and Hat World has 640.

"We remain confident that Underground Station is a viable concept filling an underserved niche in the market," said CEO Hal N. Pennington. "We believe that closing these stores will allow us to focus on strengthening the remaining stores and improve the prospects for a quicker turnaround in the Underground Station business."

Genesco's bad news comes less than a month after the company rejected an unsolicited $46-a-share takeover offer from rival

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Genesco said a subpar operating performance pulled down earnings by a penny or two a share in the first quarter, and handling the Foot Locker bid subtracted another penny or so. Asset-impairment charges accounted for the rest, Genesco said.

Shares fell 70 cents early Thursday to $48.