Finish Line Blames Q2 Losses On Lease Costs, Paiva Shutdown

The Finish Line reported losses of $1.8M during Q2, compared to a $9.9M gain during the year-ago period, according to Dana Knight of the INDIANAPOLIS STAR. The company blamed a “pre-tax charge of $13[M] involving lease costs,” as well as an inventory writedown after it closed its 15 Paiva stores. Comparable-store sales also fell 4.7%. While analysts were not surprised with the results, they “continue to question the [company’s] bid to buy rival Genesco and questioned the financial future of Finish Line if it is forced to go through with the deal.” Univ. of Indianapolis School of Business Associate Dean Matthew Will said the results “make us wonder why they are buying Genesco in the first place, because this industry is in a downward trend, not on an upslope.” Indiana Univ. associate law professor Antony Page said, “Based on publicly available information, Finish Line looks unlikely to prevail in this case” (INDIANAPOLIS STAR, 9/28). At presstime, The Finish Line was trading at $4.36, down 7.04% from Thursday’s close of $4.69 (THE DAILY).