Finish Line Reports Third Quarter Fiscal Year 2013 Results

  Finish Line Reports Third Quarter Fiscal Year 2013 Results

 Board of Directors Authorizes 5 Million Share Increase To Current Repurchase
                                   Program

Business Wire

INDIANAPOLIS -- January 4, 2013

The Finish Line, Inc. (NASDAQ: FINL) today reported results for the 13-week
and 39-week periods ended December 1, 2012.

For the thirteen weeks ended December 1, 2012:

  *Consolidated net sales increased 5.2% to $296.6 million.
  *Finish Line comparable store sales increased 3.6%.
  *Digital sales, which are included in the comparable store sales results,
    were up 25.0%.
  *Earnings per diluted share were breakeven.

“The third quarter was clearly more challenging than we anticipated,” said
Chairman and Chief Executive Officer Glenn Lyon. “Sales came in below plan due
primarily to a shift within athletic footwear trends and a less than favorable
consumer response to the new ecommerce site we launched in mid November. Our
top-line performance forced us to get more promotional to improve the
composition of our inventory ahead of the important Holiday season. At the
same time, we did not adjust our cost structure quickly enough in response to
slowing sales trends.”

“Following our recent challenges,” Lyon continued, “we have taken immediate
actions to improve near-term results. This includes reverting back to our
previous ecommerce site, implementing cost controls that allow us to better
manage expenses, and elevating the assortment of key basketball products in
our stores and online. Looking ahead, we remain committed to developing a
premier omni-channel business. We’ll also continue to evaluate the speed of
our transformation to ensure that we are best positioned to achieve both our
near- and long-term goals.”

Balance Sheet

As of December 1, 2012, consolidated merchandise inventories increased 7.6% to
$301.7 million compared to $280.4 million as of November 26, 2011. For Finish
Line, merchandise inventories increased by 6.3%.

As of December 1, 2012, the company had no interest-bearing debt and $168.2
million in cash and cash equivalents, compared to $216.6 million a year ago.

Share Repurchase Program

The company repurchased 1.0 million shares of its outstanding common stock in
the third quarter, totaling $21.2 million. Year-to-date, Finish Line
repurchased 2.5 million shares totaling $53.6 million. As of December 1, 2012,
the company had 1.3 million shares remaining on its current 5 million share
authorization. On January 3, 2013, the company’s Board of Directors amended
the current repurchase program to increase the authorization by 5 million
shares. This amendment also extends the authorization to repurchase shares
through December 31, 2017.

Outlook

For the fourth quarter ending March 2, 2013, the company expects earnings per
share to be between $0.74 and $0.78, compared to $0.74 in the fourth quarter
of fiscal 2012, which excludes the $0.07 impact from the 53rd week. This
guidance assumes fourth quarter comparable store sales increase in the low
single digit range.

For the fiscal year ending March 2, 2013, the company now expects earnings per
share to be between $1.47 and $1.51. This compares to its previous guidance
for an increase of 6 to 9% over the $1.53 in fiscal 2012, which excludes the
$0.07 impact from the 53rd week.

Q3 Fiscal 2013 Conference Call Today, January 4, 2013 at 8:30 a.m.

The company will host a conference call for investors today, January 4, 2013,
at 8:30 a.m. Eastern. To participate in the live conference call, dial
866-923-8645 (U.S. and Canada) or 660-422-4970 (International), conference ID
#80443876. The live conference call will also be accessible online at
www.finishline.com. A replay of the conference call can be accessed
approximately two hours following the completion of the call by dialing
855-859-2056, conference ID #80443876. This recording will be made available
through Friday, January 11, 2013. The replay will also be accessible online at
www.finishline.com.

About Finish Line

The Finish Line, Inc. is a premium retailer of athletic shoes, apparel and
accessories. Headquartered in Indianapolis, Finish Line has 650 stores in
malls across the U.S. and employs more than 11,000 sneakerologists who help
customers every day connect with their sport, their life and their style.
Online shopping is available at http://www.Finishline.com and mobile shopping
is available at m.Finishline.com. Follow Finish Line on Twitter at
Twitter.com/FinishLine and “like” Finish Line on Facebook at
Facebook.com/FinishLineUSA.

Finish Line also operates, through a venture with Gart Capital Partners, the
Running Specialty Group, including 25 specialty running shops in seven states
and the District of Columbia under The Running Company and Run On! banners.
More information is available at www.run.com.

Forward-Looking Statements

This news release includes statements that are or may be considered
“forward-looking” within the meaning of Section27A of the Securities Act of
1933 and Section21E of the Securities Exchange Act of 1934. These
forward-looking statements generally can be identified by the use of words or
phrases such as, but not limited to, “believe,” “expect,” “anticipate,”
“intend,” “plan,” “foresee,” “build”, “may,” “should,” “will,” “estimates,”
“indication”, “potential,” “optimistic,” “confidence,” “momentum”, “continue,”
“lead to”, “evolve,” “expand,” “growth” or words and phrases of similar
meaning. Statements that describe objectives, plans or goals also are
forward-looking statements.

All of these forward-looking statements are subject to risks, management
assumptions and uncertainties that could cause actual results to differ
materially from those contemplated by the relevant forward-looking statements.
The principal risk factors that could cause actual performance and future
actions to differ materially from the forward-looking statements include, but
are not limited to, the company’s reliance on a few key vendors for a majority
of its merchandise purchases (including a significant portion from one key
vendor); the availability and timely receipt of products; the ability to
timely fulfill and ship products to customers; fluctuations in oil prices
causing changes in gasoline and energy prices, resulting in changes in
consumer spending as well as increases in utility, freight and product costs;
product demand and market acceptance risks; deterioration of macro-economic
and business conditions; the inability to locate and obtain or retain
acceptable lease terms for the company’s stores; the effect of competitive
products and pricing; loss of key employees; execution of strategic growth
initiatives (including actual and potential mergers and acquisitions and other
components of the company’s capital allocation strategy); and the other risks
detailed in the company’s Securities and Exchange Commission filings. Readers
are urged to consider these factors carefully in evaluating the
forward-looking statements. The forward-looking statements included herein are
made only as of the date of this report and Finish Line undertakes no
obligation to publicly update these forward-looking statements to reflect
subsequent events or circumstances.

                The Finish Line, Inc.
                 Consolidated Statements of Operations (Unaudited)
                 (In thousands, except per share and store data)
                                                               
                 Thirteen        Thirteen        Thirty-Nine       Thirty-Nine
                 Weeks Ended     Weeks Ended     Weeks Ended       Weeks Ended
                 December 1,     November        December 1,       November 26,
                                 26,
                 2012            2011            2012              2011
                                                                                 
Net sales        $ 296,623       $ 282,011       $ 1,000,683       $ 912,999
Cost of sales
(including        206,833       191,002       671,684         602,393   
occupancy
costs)
Gross profit       89,790          91,009          328,999           310,606
                                                                                 
Selling,
general and        91,447          83,067          271,004           241,818
administrative
expenses
Store closing     1             368           421             965       
costs
Operating          (1,658  )       7,574           57,574            67,823
(loss) income
                                                                                 
Interest          38            109           167             390       
income, net
(Loss) Income
before income      (1,620  )       7,683           57,741            68,213
taxes
                                                                                 
Income tax
(benefit)         (811    )      2,135         22,033          25,329    
expense
Net (loss)         (809    )       5,548           35,708            42,884
income
Net loss
attributable
to redeemable     702           -             1,436           -         
noncontrolling
interest
Net (loss)
income
attributable     $ (107    )     $ 5,548        $ 37,144         $ 42,884    
to The Finish
Line, Inc.
                                                                                 
Diluted
earnings per
share
attributable     $ -            $ 0.11         $ 0.72           $ 0.80      
to The Finish
Line, Inc.
shareholders
                                                                                 
Diluted
weighted          49,949        52,082        50,977          53,076    
average shares
                                                                                 
Dividends
declared per     $ 0.06         $ 0.05         $ 0.18           $ 0.15      
share
                                                                                 
Finish Line
store activity
for the
period:
Beginning of       638             647             637               664
period
Opened             14              4               27                4
Closed            (1      )      (3      )      (13       )      (20       )
End of period     651           648           651             648       
Square feet at                                     3,531,426         3,491,396
end of period
Average square                                     5,425             5,388
feet per store
                                                                                 
Running
Company store
activity for
the period:
Beginning of       19              -               19                -
period
Acquired           5               18              5                 18
Opened             1               1               1                 1
Closed            -             -             -               -         
End of period     25            19            25              19        
Square feet at                                     78,120            57,302
end of period
Average square                                     3,125             3,016
feet per store
                                                                                 
                                                                                 
                                                                                 
                 Thirteen Weeks Ended            Thirty-Nine Weeks Ended
                 December 1,     November        December 1,       November 26,
                                 26,
                 2012            2011            2012              2011
Net sales          100.0     %     100.0     %     100.0       %     100.0       %
Cost of sales
(including        69.7          67.7          67.1            66.0      
occupancy
costs)
Gross profit       30.3            32.3            32.9              34.0
                                                                                 
Selling,
general and        30.8            29.5            27.1              26.5
administrative
expenses
Store closing     -             0.1           -               0.1       
costs
Operating          (0.5    )       2.7             5.8               7.4
(loss) income
                                                                                 
Interest          -             -             -               0.1       
income, net
(Loss) income
before income      (0.5    )       2.7             5.8               7.5
taxes
                                                                                 
Income tax
(benefit)         (0.3    )      0.7           2.2             2.8       
expense
                                                                                 
Net (loss)         (0.2    )       2.0             3.6               4.7
income
Net loss
attributable
to redeemable     0.2           -             0.1             -         
noncontrolling
interest
Net (loss)
income
attributable      -        %    2.0      %    3.7        %    4.7        %
to The Finish
Line, Inc.
                                                                                 

                                      Condensed Consolidated Balance Sheets
                                                                  
                                        December 1,   November 26,   March 3,
                                        2012          2011           2012
                                        (Unaudited)   (Unaudited)
ASSETS
Cash and cash equivalents               $  168,154    $   216,570    $ 307,494
Merchandise inventories, net               301,654        280,409      220,405
Other current assets                       30,904         21,366       24,849
Property and equipment, net                167,970        128,343      126,997
Other assets                              41,103        37,737      31,751
Total assets                            $  709,785    $   684,425    $ 711,496
                                                                     
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities                     $  145,609    $   147,983    $ 138,683
Deferred credits from landlords            28,139         30,035       27,737
Other long-term liabilities                18,462         15,335       15,539
Redeemable noncontrolling interest         4,535          -            -
Shareholders' equity                      513,040       491,072     529,537
Total liabilities and shareholders'     $  709,785    $   684,425    $ 711,496
equity

Contact:

The Finish Line, Inc.
Media Contact:
Dianna Boyce, Corporate Communications, 317-613-6577
or
Investor Contact:
Ed Wilhelm, Chief Financial Officer, 317-613-6914
 
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