On May 30, Payless ShoeSource
- Sales increased 4.9%, fueled completely by same-store growth of 5%, which was the ninth consecutive quarter of positive comp growth.
- A slight increase in the net margin and fewer shares outstanding leverage that sales growth to even higher EPS growth.
- Payless ShoeSource signed a definitive agreement to acquire The Stride Rite Corp. The combined entity will be known as Collective Brands Inc.
- Payless carries a three-star Motley Fool CAPS rating (out of a top level of five), while rival footwear competitor Foot Locker Inc.
(NYSE:FL) carries a two-star rating.
(Figures in millions, except per-share data.)
Income Statement Highlights
|
Q1 2007 |
Q1 2006 |
Change |
|
|---|---|---|---|
|
Sales |
$728.6 |
$694.5 |
4.9% |
|
Net Profit* |
$39.0 |
$36.8 |
6.0% |
|
EPS |
$0.59 |
$0.54 |
9.3% |
|
Diluted Shares |
66.0 |
67.6 |
(2.4%) |
Get back to basics with the income statement.
Margin Checkup
|
Q1 2007 |
Q1 2006 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
36.9% |
36.8% |
0.1 |
|
Operating Margin |
8.1% |
8.2% |
(0.1) |
|
Net Margin |
5.4% |
5.3% |
0.1 |
Margins are the earnings engine.
Balance Sheet Highlights
|
Assets |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$327.5 |
$408.1 |
(19.8%) |
|
Inventory |
$381.7 |
$377.7 |
1.1% |
|
Liabilities |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Accounts Payable |
$157.5 |
$175.2 |
(10.1%) |
|
Long-Term Debt |
$201.7 |
$202.9 |
(0.6%) |
The balance sheet reflects the company's health.
Cash Flow Highlights
|
YTD 2007 |
YTD 2006 |
Change |
|
|---|---|---|---|
|
Cash From Ops. |
$21.3 |
$16.7 |
27.5% |
|
Capital Expenditures |
$55.7 |
$23.0 |
142.2% |
|
Free Cash Flow |
($34.4) |
($6.3) |
N/A |
Free cash flow is a Fool's best friend.
Related Foolishness:
- Quick Take: Payless Pays Up for Stride Rite
- Shoe Carnival Stubs Its Toe
- Payless Marches Toward Branding
- Floundering at Finish Line
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