Athletic Footwear

Converse Inc.

Converse <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CVE)") else Response.Write("(NYSE: CVE)") end if %> warned in its most recent quarterly report that its profits from continuing operations in the second half of the year will be lower than originally anticipated. Since February, the stock has been cut in half after "rebounding" in the second half of 1996, closing up 312% by the end of the year (making it the second best performer on the NYSE in 1996). Trading at 20x forward earnings may be a little rich for a company struggling with five-year average net profit margins of -2.99% and trailing 6-month margins of 0.05%.

Latest Financials

Net sales for the second quarter were $103.3 million compared to $79.9 million in the second quarter of 1996, an increase of 29.3%. Earnings from operations were $5.4 million compared to $2.3 million in the second quarter of 1996. Net earnings from continuing operations were $0.8 million, or $0.05 per share, compared to a loss of $3.7 million, or a $0.22 loss per share in the second quarter of 1996. During the second quarter of 1997 the company recorded an extraordinary loss of $0.8 million, or $0.05 per share, from the write-off of deferred financing fees relating to the repayment of its former credit facility, resulting in breakeven net income for the second quarter.

(Go to next snapshot.)

© Copyright 1995-2000, The Motley Fool. All rights reserved. This material is for personal use only. Republication and redissemination, including posting to news groups, is expressly prohibited without the prior written consent of The Motley Fool. The Motley Fool is a registered trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us
..

..

..

..

..

....

...

...

...

...