On Tuesday, April 10, footwear retailer Bakers Footwear
- Net sales fell 0.2%, as same-store sales plummeted 13.8%. According to Bakers, "the fourth quarter was particularly challenging, ... reflecting a difficult boot and bootie season, which led to higher than anticipated markdowns following robust sales growth last year."
- Operating income fell 63.3%, while diluted earnings fell a gloomier 69.1%, as Bakers struggles to find the right product mix.
- On a more positive note, Bakers decreased inventory 7.3% from last year to lower further markdown risk and wait for warmer summer weather. However, this could limit upside, should sales trends turn positive.
- Fools may want to check out footwear firms that couple control of their own brands with a retail presence. These include Skechers
(NYSE:SKX) , Nike(NYSE:NKE) , and Steve Madden(NASDAQ:SHOO) . These firms carry favorable four-star ratings in Motley Fool's CAPS community. Also, Payless ShoeSource(NYSE:PSS) is just beginning its march toward branding, via relationships with Nike and Walt Disney(NYSE:DIS) .
(Figures in thousands, except per-share data)
Income Statement Highlights
|
Q4 2006 |
Q4 2005 |
Change |
|
|---|---|---|---|
|
Sales |
$61,211 |
$61,338 |
(0.2%) |
|
Net Profit |
$1,417 |
$4,528 |
(68.7%) |
|
EPS |
$0.21 |
$0.68 |
(69.1%) |
|
Diluted Shares |
6,645 |
6,657 |
(0.2%) |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q4 2006 |
Q4 2005 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
33.1% |
37.7% |
(4.6) |
|
Operating Margin |
4.4% |
12.0% |
(7.6) |
|
Net Margin |
2.3% |
7.4% |
(5.1) |
Margins are the earnings engine.
Balance Sheet Highlights
|
Assets |
Q4 2006 |
Q4 2005 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$407 |
$3,925 |
(89.6%) |
|
Accounts Rec. |
$2,493 |
$2,371 |
5.1% |
|
Inventory |
$24,102 |
$25,998 |
(7.3%) |
|
Liabilities |
Q4 2006 |
Q4 2005 |
Change |
|---|---|---|---|
|
Accounts Payable |
$8,134 |
$12,059 |
(32.5%) |
The balance sheet reflects the company's health.
Cash Flow Highlights
|
Q4 2006 |
Q4 2005 |
Change |
|
|---|---|---|---|
|
Cash From Ops. |
$2,428 |
$17,536 |
(86.2%) |
Free cash flow is a Fool's best friend.
Related Foolishness:
- Warren Buffett's Priceless Investment Advice
- Walking Short at Bakers
- 70 Times Better Than the Next Microsoft
Walt Disney is also a Motley Fool Stock Advisor recommendation. Get the lowdown with a free 30-day trial pass to our flagship investing service.
Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.
Fool contributor Ryan Fuhrmann is long shares of Nike but has no financial interest in any other company mentioned. Feel free to email him with feedback or to discuss any companies mentioned further. The Fool has an ironclad disclosure policy.
