The retail industry is struggling to survive in the face of this pandemic. The latest in a growing set of examples is athletic apparel and sneaker specialist Foot Locker (NYSE:FL), the stock price of which dived after the company posted its Q1 fiscal 2020 results on Friday.
For the quarter, Foot Locker's sales came in at just under $1.18 billion, down a steep 43% from the same period last year. Comparable-store sales dropped by roughly the same percentage. In terms of profitability -- or the lack thereof -- the retailer swung to a loss of $70 million, or $0.67 per share, on a non-GAAP (adjusted) basis. The Q1 2019 result was a net profit of $173 million.
Although Foot Locker has been reopening stores as permitted lately, the shutdowns engendered by the SARS-CoV-2 coronavirus outbreak badly affected the company. After all, it still has a very heavy brick-and-mortar store footprint, and since its core product is shoes, it relies on in-person visits to drive sales.
To help protect its business during the downturn, Foot Locker announced in the earnings release that it is temporarily suspending its dividend. The company gave no indication as to when the suspension would be lifted but did say that its board "will continue to evaluate the dividend policy on a quarterly basis." The share repurchase program was recently suspended as well.
Investors aren't keen on Foot Locker stock just now. On Friday, they traded the shares down by almost 8.5%, in contrast to the gains most major equity indexes saw.