Collective Brands posts 13 percent gain in 2nd-qtr profit, but results miss Wall Street views

Collective Brands 2Q profit rises but misses views

TOPEKA, Kan. — Collective Brands Inc., the parent of Payless ShoeSource, said its fiscal second-quarter profit rose 13 percent as sales edged up and expenses declined.

But results fell short of Wall Street expectations and the stock fell in after-hours trading.

The maker of Stride Rite, Keds and Saucony brand shoes said net income for the three months ended July 31 rose to $21.1 million, or 32 cents per share, from $18.7 million, or 29 cents per share, in the corresponding period last year.

Sales rose a fraction to $841.3 million, compared with $836.3 million last year.

Analysts polled by Thomson Reuters, on average, expected profit of 45 cents per share, on revenue of $862.8 million.

Sales in U.S. Payless stores fell 7 percent to $508 million, reflecting the closing of six stores as well as lower store traffic.

International sales rose 6 percent to $109.8 million, reflecting strong performance in Ecuador and a better exchange rate in Canada. PLG Wholesale unit sales jumped 27 percent to $174.4 million, while PLG retail unit sales edged up 2 percent to $48.8 million.

By the end of the year, the company expects to close a net of 20 additional Payless stores in the U.S., while opening an equal number internationally. It also plans to open 20 more PLG retail stores by the end of 2010.

In aftermarket trading, Collective Brands shares slid 71 cents, or 5.2 percent, to $13.05. That reversed a gain of 83 cents, or 6.4 percent, during the regular session, which it closed at $13.76.