GENESCO INC

Previous wording

Journeys Group sales increased 3%, partially offset by a sales decrease of 6% at Johnston & Murphy Group and a sales decrease of 11% at Genesco Brands Group, while Schuh Group sales were flat.

Current wording

Journeys Group sales increased 7% and Schuh Group sales increased 4%, partially offset by a sales decrease of 4% at Genesco Brands Group, while Johnston & Murphy Group sales were flat for Fiscal 2026 as compared to Fiscal 2025.

Previous wording

Total comparable sales increased 3% for Fiscal 2025, including flat same store sales and a 12% increase in comparable e-commerce sales.

Current wording

Total comparable sales increased 6% for Fiscal 2026, including a 6% increase in same store sales and a 4% increase in comparable e-commerce sales.

Previous wording

Selling and administrative expenses decreased 10 basis points as a percentage of net sales from 46.5% in Fiscal 2024 to 46.4% in Fiscal 2025.

Current wording

Selling and administrative expenses decreased 120 basis points as a percentage of net sales from 46.4% in Fiscal 2025 to 45.2% in Fiscal 2026.

Previous wording

Operating margin increased 120 basis points as a percentage of net sales from (0.6%) in Fiscal 2024 to 0.6% in Fiscal 2025.

Current wording

Operating margin increased 10 basis points as a percentage of net sales from 0.6% in Fiscal 2025 to 0.7% in Fiscal 2026.

Previous wording

The effective income tax rate increased from (8.5%) in Fiscal 2024 to 309.6% in Fiscal 2025 as a result of a $26.2 million valuation allowance in Fiscal 2025.

Current wording

The effective income tax rate decreased from 309.6% in Fiscal 2025 to (5.4)% in Fiscal 2026 as a result of the impact of the One Big Beautiful Bill Act ("OBBBA") in Fiscal 2026 and a $26.2 million valuation allowance in Fiscal 2025.

Previous wording

Diluted loss per share from continuing operations was $1.80 per share in Fiscal 2025 compared to $2.10 per share in Fiscal 2024.

Current wording

Diluted earnings per share from continuing operations was $1.25 per share in Fiscal 2026 compared to a diluted loss per share from continuing operations of $1.80 per share in Fiscal 2025.

Previous wording

Gross margin decreased 0.2% to $1.097 billion in Fiscal 2025 from $1.099 billion in Fiscal 2024 and decreased as a percentage of net sales from 47.3% in Fiscal 2024 to 47.2% in Fiscal 2025, reflecting decreased gross margin as a percentage of net sales in Journeys Group and Schuh Group, partially offset by an increase in gross margin as a percentage of net sales in Johnston & Murphy Group and Genesco Brands Group. The overall decrease in gross margin as a percentage of net sales reflects increased promotional activity at Schuh Group, partially offset by better initial margins and lower wholesale reserves at Johnston & Murphy Group and a favorable change in product mix at Genesco Brands Group.

Current wording

Gross margin increased 2.7% to $1.127 billion in Fiscal 2026 from $1.097 billion in Fiscal 2025. Gross margin decreased 90 basis points as a percentage of net sales from 47.2% in Fiscal 2025 to 46.3% in Fiscal 2026, reflecting decreased gross margin as a percentage of net sales in Schuh Group and Genesco Brands Group, while gross margin as a percentage of net sales was flat in both Journeys Group and Johnston & Murphy Group. The overall decrease in gross margin as a percentage of net sales reflects increased promotional activity at Schuh Group and lower margins at Genesco Brands Group related to the exit of licenses and ongoing tariff pressure.

Previous wording

Selling and administrative expenses in Fiscal 2025 decreased to $1.080 billion compared to $1.082 billion in Fiscal 2024. Selling and administrative expenses decreased 10 basis points as a percentage of net sales in Fiscal 2025 compared to Fiscal 2024 from 46.5% to 46.4%, reflecting decreased expenses as a percentage of net sales at Journeys Group and Genesco Brands Group, partially offset by increased expenses as a percentage of net sales at Schuh Group and Johnston & Murphy Group. The overall decrease in expenses as a percentage of net sales in Fiscal 2025 reflects a decrease in occupancy costs, partially offset by increased marketing expenses. Explanations of the changes in results of operations are provided by business segment in discussions following these introductory paragraphs.

Current wording

Selling and administrative expenses in Fiscal 2026 increased 2.0% to $1.101 billion compared to $1.080 billion in Fiscal 2025. Selling and administrative expenses decreased 120 basis points as a percentage of net sales from 46.4% in Fiscal 2025 to 45.2% in Fiscal 2026, reflecting decreased expenses as a percentage of net sales at Journeys Group and Genesco Brands Group, partially offset by increased expenses as a percentage of net sales at Schuh Group and Johnston & Murphy Group. The overall decrease in expenses as a percentage of net sales in Fiscal 2026 reflects a decrease in occupancy costs and selling salaries along with other expenses as part of our cost savings initiatives. Explanations of the changes in results of operations are provided by business segment in discussions following these introductory paragraphs.

Previous wording

Operating margin was 0.6% in Fiscal 2025 compared to an operating margin loss of (0.6)% in Fiscal 2024 reflecting improved operating margin at Journeys Group and Genesco Brands Group, partially offset by decreased operating margin at Schuh Group and Johnston & Murphy Group. The improvement in operating margin in Fiscal 2025 primarily reflects a non-cash goodwill impairment charge of $28.5 million in Fiscal 2024 and decreased selling and administrative expenses as a percentage of net sales, partially offset by decreased gross margin as a percentage of net sales in Fiscal 2025 compared to Fiscal 2024.

Current wording

Operating margin was 0.7% in Fiscal 2026 compared to 0.6% in Fiscal 2025 reflecting improved operating margin at Journeys Group, partially offset by decreased operating margin at Schuh Group, Johnston & Murphy Group and Genesco Brands Group. The overall improvement in operating margin in Fiscal 2026 primarily reflects decreased selling and administrative expenses as a percentage of net sales, partially offset by decreased gross margin as a percentage of net sales and higher asset impairment and other charges in Fiscal 2026 compared to Fiscal 2025.

Previous wording

Earnings from continuing operations before income taxes (“pretax earnings") for Fiscal 2025 was $9.3 million, compared to a loss from continuing operations before income taxes ("pretax loss") of $21.8 million for Fiscal 2024. Pretax earnings for Fiscal 2025 included asset impairment and other charges of $3.2 million which included $1.8 million for severance and $1.4 million for asset impairments. The pretax loss for Fiscal 2024 included a non-cash goodwill impairment charge of $28.5 million and asset impairment and other charges of $1.8 million which included $1.1 million for severance and $1.0 million for asset impairments, partially offset by a $0.3 million insurance gain.

Current wording

Earnings from continuing operations before income taxes (“pretax earnings") for Fiscal 2026 were $12.6 million, compared to $9.3 million for Fiscal 2025. Pretax earnings for Fiscal 2026 included asset impairment and other charges of $8.1 million which included $3.9 million for store restructuring, $2.9 million for costs associated with information technology transformation, $0.7 million for asset impairments and $0.6 million for severance. Pretax earnings for Fiscal 2025 included asset impairment and other charges of $3.2 million which included $1.8 million for severance and $1.4 million for asset impairments.

Previous wording

The effective income tax rate was 309.6% for Fiscal 2025 compared to (8.5%) for Fiscal 2024. The higher effective tax rate for Fiscal 2025 compared to Fiscal 2024 reflects a $26.2 million U.S. valuation allowance recorded in Fiscal 2025, reflecting the uncertainty regarding our ability to realize the benefit of our general tax attributes in the U.S. See Item 8, Note 11, "Income Taxes", to our Consolidated Financial Statements included in this Annual Report on Form 10-K for additional information.

Current wording

The effective income tax rate was (5.4)% for Fiscal 2026 compared to 309.6% for Fiscal 2025. The lower effective tax rate for Fiscal 2026 compared to Fiscal 2025 reflects the impact of the enactment of income tax law changes under the OBBBA in Fiscal 2026 and their interaction with our valuation allowance in the U.S. jurisdiction coupled with a tax benefit associated with our losses generated in our U.K. tax jurisdiction. Conversely, the higher effective tax rate for Fiscal 2025 reflects a $26.2 million U.S. valuation allowance recorded in Fiscal 2025, reflecting the uncertainty regarding our ability to realize the benefit of our general tax attributes in the U.S. See Item 8, Note 11, "Income Taxes", to our Consolidated Financial Statements included in this Annual Report on Form 10-K for additional information.

Previous wording

The net loss for Fiscal 2025 was $18.9 million, or $1.74 diluted loss per share compared to a net loss of $16.8 million, or $1.50 diluted loss per share for Fiscal 2024. The net loss for Fiscal 2025 and Fiscal 2024 includes a $1.2 million ($0.9 million, net of tax) and $9.4 million ($7.2 million, net of tax), respectively, gain from insurance proceeds related to legacy environmental matters.

Current wording

Net earnings for Fiscal 2026 were $13.3 million, or $1.25 diluted earnings per share compared to a net loss of $18.9 million, or $1.74 diluted loss per share for Fiscal 2025. The net loss for Fiscal 2025 includes a $1.2 million ($0.9 million, net of tax) gain from insurance proceeds related to legacy environmental matters.

Previous wording

Net sales from Journeys Group increased 2.6% to $1.40 billion for Fiscal 2025 compared to $1.36 billion for Fiscal 2024. The increase in net sales was primarily due to a total comparable sales increase of 6% driven by increased comparable e-commerce sales and increased same store sales, partially offset by a 5% decrease in the average number of Journeys stores for Fiscal 2025 due to 57 net store closures and a decrease in sales related to the 53-week calendar shift. We believe our Journeys consumer is more interested in a broader range of brands they are buying and more diversified in the styles they are wearing. We have injected the product assortment with more new relevant product offerings across several casual and athletic brands and increased investment in the Journeys brand to elevate the customer experience.

Current wording

Net sales from Journeys Group increased 6.8% to $1.49 billion for Fiscal 2026 compared to $1.40 billion for Fiscal 2025. The increase in net sales was primarily due to a total comparable sales increase of 9% primarily reflecting increased store sales, partially offset by a 5% decrease in the average number of Journeys stores for Fiscal 2026 due to 41 net store closures. The increase in comparable sales in Fiscal 2026 was fueled by strength in Journeys Group's product assortment with brands across both casual and athletic posting gains. Journeys Group drove strong gains in conversion and transaction size. We continue to elevate the product assortment and invest in the Journeys brand to improve the customer experience.

Previous wording

The store count for Journeys Group was 1,006 stores at the end of Fiscal 2025, including 211 Journeys Kidz stores, 35 Journeys stores in Canada and 30 Little Burgundy stores in Canada, compared to 1,063 stores at the end of Fiscal 2024, including 222 Journeys Kidz stores, 39 Journeys stores in Canada and 33 Little Burgundy stores in Canada.

Current wording

The store count for Journeys Group was 965 stores at the end of Fiscal 2026, including 194 Journeys Kidz stores, 33 Journeys stores in Canada and 30 Little Burgundy stores in Canada, compared to 1,006 stores at the end of Fiscal 2025, including 211 Journeys Kidz stores, 35 Journeys stores in Canada and 30 Little Burgundy stores in Canada.

Previous wording

The 110 basis point improvement in operating margin for Journeys Group in Fiscal 2025 compared to Fiscal 2024 was primarily due to decreased selling and administrative expenses as a percentage of net sales reflecting decreased occupancy, compensation and freight expenses, partially offset by increased performance-based compensation and marketing expenses. Gross margin decreased by 10 basis points as a percentage of net sales in Fiscal 2025, reflecting changes in product mix, partially offset by decreased markdowns.

Current wording

The 210 basis point improvement in operating margin for Journeys Group in Fiscal 2026 compared to Fiscal 2025 was primarily due to decreased selling and administrative expenses as a percentage of net sales reflecting leverage of expense as a result of increased revenue in Fiscal 2026, especially occupancy expense and selling salaries, and also reflecting our cost savings initiatives. The decrease in selling and administrative expense as a percentage of net sales demonstrates the impact of our cost savings initiatives and closing underperforming stores. Gross margin as a percentage of net sales was flat in Fiscal 2026 as changes in product mix were offset by lower markdowns and decreased shipping and warehouse expense.

Previous wording

Net sales from the Schuh Group were flat at $479.9 million for Fiscal 2025 compared to $480.2 million for Fiscal 2024. Net sales in Fiscal 2025 included a total comparable sales decrease of 2% driven by decreased store sales, partially offset by increased e-commerce comparable sales, accelerating to over 40% of Schuh sales, and a favorable impact of $9.0 million in sales due to changes in foreign exchange rates. Schuh's sales decreased 2% on a local currency basis for Fiscal 2025. Schuh continues to contend with a challenging and highly promotional U.K. footwear market. The consumer continues to be selective with their discretionary purchases. In addition, Schuh Group sales in Fiscal 2025 compares against back-to-back years of record sales growth. Schuh Group operated 124 stores at the end of Fiscal 2025 compared to 122 stores at the end of Fiscal 2024.

Current wording

Net sales from Schuh Group increased 4.2% to $500.0 million for Fiscal 2026 compared to $479.9 million for Fiscal 2025. Net sales in Fiscal 2026 included a favorable impact of $21.2 million in sales due to changes in foreign exchange rates and an increase in e-commerce comparable sales, partially offset by decreased stores sales. Total comparable sales were flat for Schuh Group in Fiscal 2026. Schuh Group's sales were flat on a local currency basis for Fiscal 2026. Schuh Group performance was impacted by the ongoing challenging U.K. retail environment in Fiscal 2026. The e-commerce business remains a key channel for consumer engagement, accounting for over 45% of its sales in Fiscal 2026. Schuh Group operated 118 stores at the end of Fiscal 2026 compared to 124 stores at the end of Fiscal 2025.

Previous wording

The 240 basis point decrease in operating margin for Fiscal 2025 compared to Fiscal 2024 reflects decreased gross margin as a percentage of net sales reflecting a more promotional environment at Schuh Group during Fiscal 2025, partially offset by decreased shipping and warehouse expenses. The increase in selling and administrative expenses as a percentage of net sales also contributed to the decrease in operating margin reflecting increased selling salaries, marketing expense and depreciation expense, partially offset by decreased performance-based compensation expense and occupancy expense. In addition, operating income included a favorable impact of $0.2 million due to changes in foreign exchange rates compared to last year.

Current wording

The 300 basis point decrease in operating margin for Fiscal 2026 compared to Fiscal 2025 reflects decreased gross margin as a percentage of net sales reflecting increased promotional activity, including increased loyalty redemptions and promotions to match the competitive environment, partially offset by decreased shipping and warehouse expenses. In addition, selling and administrative expenses increased as a percentage of net sales, reflecting deleverage of expenses, especially marketing expense and selling salaries, partially offset by decreased compensation expense.

Previous wording

Net sales were flat in Fiscal 2025 compared to Fiscal 2024.

Current wording

Johnston & Murphy Group net sales were flat at $320.2 million for Fiscal 2026 and Fiscal 2025. Total comparable sales were flat in Fiscal 2026 and the average number of Johnston & Murphy stores decreased 1% for Fiscal 2026 which was offset by a small increase in wholesale sales. Retail operations accounted for 77.9% of Johnston & Murphy Group's sales in Fiscal 2026, down from 78.3% in Fiscal 2025. The store count for Johnston & Murphy retail operations at the end of Fiscal 2026 was 153 Johnston & Murphy shops and factory stores, compared to 148 Johnston & Murphy shops and factory stores at the end of Fiscal 2025.

Previous wording

The 220 basis point decrease in operating margin for Johnston & Murphy Group for Fiscal 2025 compared to Fiscal 2024 reflects increased selling and administrative expenses as a percentage of net sales for Fiscal 2025, reflecting the deleverage of expenses, especially marketing expense, selling salaries and compensation expense in part as a result of decreased revenue in Fiscal 2025. Johnston & Murphy continues to make investments in marketing to enhance the brand as the men's non-athletic premium footwear market returns to a more normal operating environment. Gross margin as a percentage of net sales increased in Fiscal 2025, primarily reflecting improved initial margins and lower markdowns.

Current wording

The 120 basis point decrease in operating margin for Johnston & Murphy Group for Fiscal 2026 compared to Fiscal 2025 reflects increased selling and administrative expenses as a percentage of net sales for Fiscal 2026, reflecting increased depreciation, occupancy and compensation expenses, partially offset by decreased marketing expense. Gross margin as a percentage of net sales was flat in Fiscal 2026 compared to Fiscal 2025 as better initial margins at retail were offset by lower wholesale margins due primarily to tariff impacts.

Previous wording

Net sales for Genesco Brands Group decreased 10.7% to $126.0 million for Fiscal 2025 from $141.2 million for Fiscal 2024, primarily due to the repositioning of the business to a more refined portfolio of licenses to emphasize key brands, partially offset by increased sales of Dockers footwear.

Current wording

Net sales for Genesco Brands Group decreased 3.8% to $121.2 million for Fiscal 2026 from $126.0 million for Fiscal 2025, primarily due to decreased sales of Levi's as we exit that business, partially offset by increased sales of private label footwear.

Previous wording

The 540 basis point improvement in operating margin for Genesco Brands Group in Fiscal 2025 was primarily due to decreased selling and administrative expenses as a percentage of net sales reflecting decreased royalty, marketing and other expenses primarily as a result of an amendment to the Levi's license agreement, partially offset by increased performance-based compensation and freight expenses. Gross margin increased as a percentage of net sales which also contributed to the operating margin improvement, reflecting a favorable brand sales mix shift.

Current wording

The 550 basis point decrease in operating margin for Genesco Brands Group in Fiscal 2026 was primarily due to decreased gross margin as a percentage of net sales due to the impact of tariffs and higher closeout sales related to the exit of Levi's and other licenses as well as an unfavorable change in sales mix. Gross margin included an inventory write-down related to the exit of licenses in Fiscal 2026 and a charge for a distribution model transition in Fiscal 2025. The decrease in gross margin was partially offset by decreased selling and administrative expenses as a percentage of net sales in Fiscal 2026 primarily reflecting decreased performance-based compensation, freight and other expenses, partially offset by increased royalty expense, due to a reversal of royalty expense last year resulting from an amendment to the Levi's license agreement.

Previous wording

Corporate and other expense for Fiscal 2025 decreased 39% to $37.8 million compared to $62.3 million for Fiscal 2024. Corporate and other expense in Fiscal 2025 included a $3.2 million charge in asset impairment and other charges which included $1.8 million for severance and $1.4 million for asset impairments. Corporate and other expense in Fiscal 2024 included non-cash impairment charges of $28.5 million related to goodwill and a $1.8 million charge in asset impairment and other charges which included $1.1 million in severance and $1.0 million for asset impairments, partially offset by a $0.3 million insurance gain. The corporate expense increase, excluding asset impairment and other charges in Fiscal 2025 and Fiscal 2024 and goodwill impairment in Fiscal 2024, primarily reflects an increase in performance-based compensation and compensation expenses in Fiscal 2025 compared to Fiscal 2024.

Current wording

Corporate and other expense for Fiscal 2026 increased 14% to $43.2 million compared to $37.8 million for Fiscal 2025. Corporate and other expense in Fiscal 2026 included an $8.1 million charge in asset impairments and other which included $3.9 million for store restructuring, $2.9 million for costs associated with information technology transformation, $0.7 million for asset impairments and $0.6 million for severance. Corporate and other expense in Fiscal 2025 included a $3.2 million charge in asset impairment and other charges which included $1.8 million for severance and $1.4 million for asset impairments. The corporate expense increase, excluding asset impairment and other charges in Fiscal 2026 and Fiscal 2025, primarily reflects an increase in compensation expense, partially offset by a decrease in professional fees in Fiscal 2026 compared to Fiscal 2025.

Previous wording

Net interest expense decreased $3.5 million or 45.4% to $4.3 million in Fiscal 2025 from $7.8 million in Fiscal 2024 primarily reflecting decreased average borrowings in Fiscal 2025 compared to Fiscal 2024.

Current wording

Net interest expense decreased 3.6% or $0.2 million to $4.1 million in Fiscal 2026 from $4.3 million in Fiscal 2025 primarily reflecting decreased revolver borrowings in the U.S. in Fiscal 2026 compared to Fiscal 2025, partially offset by increased revolver borrowings in the U.K. in Fiscal 2026.

Previous wording

Cash provided by operating activities was $6.9 million lower in Fiscal 2025 compared to Fiscal 2024, reflecting primarily the following factors:

Current wording

Cash provided by operating activities was $57.9 million higher in Fiscal 2026 compared to Fiscal 2025, reflecting primarily the following factors:

Previous wording

a $61.7 million increase in cash flow from changes in other assets and liabilities, partially offset by a $47.6 million decrease in cash flow from changes in prepaids and other current assets, primarily reflecting changes in timing of prepaid income taxes and changes in timing of rent payments in Fiscal 2025 compared to Fiscal 2024.

Current wording

a $123.5 million increase in cash flow from changes in prepaids and other current assets, partially offset by a $56.1 million decrease in cash flow from changes in other assets and liabilities, primarily reflecting the receipt of a $59.3 million income tax refund; and

Previous wording

an $82.0 million increase in cash flow from changes in accounts payable, primarily reflecting changes in buying patterns in Fiscal 2025;

Current wording

a $67.5 million decrease in cash flow from changes in accounts payable, primarily reflecting changes in timing of rent payments and changes in buying and receipt patterns in Fiscal 2026.

Previous wording

Cash used in investing activities was $18.9 million lower in Fiscal 2025 compared to Fiscal 2024 reflecting decreased capital expenditures primarily related to omni-channel capabilities and investments in retail stores.

Current wording

Cash used in investing activities was $20.9 million higher in Fiscal 2026 compared to Fiscal 2025 reflecting increased capital expenditures primarily related to investments in retail stores, primarily renovations.

Previous wording

Cash used in financing activities was $0.6 million lower in Fiscal 2025 as compared to Fiscal 2024 primarily reflecting decreased share repurchases, partially offset by decreased net borrowings this year compared to last year.

Current wording

Cash used in financing activities was $33.7 million lower in Fiscal 2026 as compared to Fiscal 2025 primarily reflecting higher net payments in Fiscal 2025 compared to Fiscal 2026.

Previous wording

On January 28, 2022, we entered into a Third Amendment (the "Third Amendment") to our Fourth Amended and Restated Credit Agreement dated as of January 31, 2018 between us, certain of our subsidiaries, the lenders party thereto and Bank of America, N.A. as agent (as amended, the "Credit Facility" or the "Credit Agreement") to, among other things, extend the maturity date to January 28, 2027 and remove the $17.5 million first in-last out term loan. The Total Commitments (as defined in the Credit Agreement) for revolving loans is $332.5 million. As of February 1, 2025 we did not have any revolver borrowings outstanding.

Current wording

On January 16, 2026, we entered into the Fourth Amendment (the "Fourth Amendment") to the Fourth Amended and Restated Credit Agreement dated as of January 31, 2018 (as amended, the "Credit Facility" or the "Credit Agreement") by and among us, certain of our subsidiaries, the lenders party thereto and Bank of America, N.A. as agent, to, among other things, extend the maturity date to January 16, 2031. In addition, the Fourth Amendment (i) makes conforming changes to replace the Canadian Dollar Offered Rate with the Canadian Overnight Repo Rate Average ("CORRA") with respect to Canadian borrowings and (ii) removes the credit spread adjustment and thereby reduces the Term SOFR (as defined in the Credit Agreement) interest rate with respect to domestic borrowings. The Total Commitments (as defined in the Credit Agreement) for the revolving loans remains at $332.5 million. As of January 31, 2026, we had outstanding revolver borrowings under the Credit Facility of $3.4 million (CAD

Previous wording

We had outstanding letters of credit of $5.9 million under the Credit Facility at February 1, 2025. These letters of credit support lease and insurance indemnifications.

Current wording

$4.6 million) related to GCO Canada ULC. We had outstanding letters of credit of $6.2 million under the Credit Facility at January 31, 2026. These letters of credit support insurance and lease indemnifications.

Previous wording

On November 2, 2022, Schuh entered into a facility agreement (the "Facility Agreement") with Lloyds Bank PLC (“Lloyds”) for a £19.0 million revolving credit facility. The Facility Agreement expires November 2, 2025, with options to request two one-year extensions to this termination date subject to lender approval, and bears interest at 2.35% over the Bank of England Base Rate. This Facility Agreement replaced Schuh's Facility Letter that would have expired in October 2023. The Facility Agreement includes certain financial covenants specific to Schuh. Following certain customary events of default outlined in the Facility Agreement, payment of outstanding amounts due may be accelerated or the commitments may be terminated. The Facility Agreement is secured by charges over all of the assets of Schuh, and Schuh's subsidiary, Schuh (ROI) Limited. Pursuant to a Guarantee in favor of Lloyds in its capacity as security trustee, Genesco Inc. has guaranteed the obligations of Schuh under the Facility Agreement and certain existing ancillary facilities on an unsecured basis. As of February 1, 2025, we did not have any borrowings under the Schuh Facility Agreement.

Current wording

On November 2, 2022, Schuh entered into a facility agreement (the "Facility Agreement") with Lloyds Bank PLC (“Lloyds”) for a £19.0 million revolving credit facility. The Facility Agreement was extended through February 28, 2026 and bears interest at 2.35% over the SONIA Rate. The Facility Agreement was amended during the first quarter of Fiscal 2027 on February 20, 2026 to, among other things, increase the commitment of the credit facility to £20.0 million, extend the maturity date to August 20, 2027, and it will bear interest at 1.75% over the SONIA Rate. This Facility Agreement replaced Schuh's Facility Letter. The Facility Agreement includes certain financial covenants specific to Schuh. Following certain customary events of default outlined in the Facility Agreement, payment of outstanding amounts due may be accelerated or the commitments may be terminated. The Facility Agreement is secured by charges over all of the assets of Schuh, and Schuh's subsidiary, Schuh (ROI) Limited. Pursuant to a Guarantee in favor of Lloyds in its capacity as security trustee, Genesco Inc. has guaranteed the obligations of Schuh under the Facility Agreement and certain existing ancillary facilities on an unsecured basis. As of January 31, 2026, we did not have any borrowings under the Schuh Facility Agreement.

Previous wording

In the fourth quarter of Fiscal 2021, we implemented tax strategies allowed under the 5-year carryback provisions in the CARES Act which we believed would generate approximately $55 million of net tax refunds. We received approximately $26 million of such net tax refunds in Fiscal 2022 and anticipated receipt of the remaining outstanding net tax refund in Fiscal 2023. However, in the third quarter of Fiscal 2023, we were notified that the Internal Revenue Service ("IRS") would conduct an audit of the periods related to the outstanding net tax refund. As a result, the timing of the net tax refund was extended due to the audit process. On January 17, 2025, we executed Form 870 with the IRS exam team and began the process of completing the separate Joint Committee on Taxation review of our claim. Form 870 is used upon completion of an IRS examination to indicate the taxpayer’s agreement with the revenue agent’s report of proposed adjustments and agreement to pay any deficiency. As a result, we now expect a refund of $59.3 million based on additional accrued interest and minor changes to the refund as agreed to on Form 870. Further, we now expect to complete the remaining requirements of the Joint Committee on Taxation governmental review process and collect the refund during Fiscal 2026. As such, we have moved the receivable from noncurrent prepaid income taxes to prepaids and other current assets on the Consolidated Balance Sheets as of February 1, 2025.

Current wording

In the fourth quarter of Fiscal 2021, we implemented tax strategies allowed under the 5-year carryback provisions in the CARES Act which we believed would generate approximately $55 million of net tax refunds. We received approximately $26 million of such net tax refunds in Fiscal 2022 and anticipated receipt of the remaining outstanding net tax refund in Fiscal 2023. However, in the third quarter of Fiscal 2023, we were notified that the IRS would conduct an audit of the periods related to the outstanding net tax refund. As a result, the timing of the net tax refund was extended due to the audit process. On January 17, 2025, we executed Form 870 with the IRS exam team and began the process of completing the separate Joint Committee on Taxation ("JCT") review of our outstanding U.S. Federal tax refund claim for the Fiscal 2014 to Fiscal 2021 tax periods. During the first quarter of Fiscal 2026, the JCT finalized their review with no changes to the claim and the IRS began the process of issuing the refund. The balance outstanding increased as a result of additional accrued interest. We received a total refund of $60.1 million, including interest, in Fiscal 2026.

Previous wording

(1) Operating lease obligations excludes $27.9 million for leases signed but not yet commenced.

Current wording

(1) Operating lease obligations excludes $55.8 million for leases signed but not yet commenced.

Previous wording

Capital expenditures were $41.1 million and $60.3 million for Fiscal 2025 and 2024, respectively. The $19.2 million decrease in Fiscal 2025 capital expenditures as compared to Fiscal 2024 is primarily due to decreases in computer hardware, software and warehouse enhancements to drive traffic and omni-channel initiatives and decreases for new stores, partially offset by increased renovations.

Current wording

Capital expenditures were $62.1 million and $41.1 million for Fiscal 2026 and 2025, respectively. The $21.0 million increase in Fiscal 2026 capital expenditures as compared to Fiscal 2025 is primarily due to increased store renovations and new stores.

Previous wording

We expect total capital expenditures for Fiscal 2026 to be approximately $50-$65 million of which approximately 70% is for new stores and renovations and 30% is for computer hardware, software and warehouse enhancements for initiatives to drive traffic and omni-channel initiatives and other projects. We do not currently have any longer term capital expenditures or other cash requirements other than as set forth in the contractual obligations table. We also do not currently have any off-balance sheet arrangements.

Current wording

We expect total capital expenditures for Fiscal 2027 to be approximately $65-$70 million of which approximately 90% is for new stores and renovations and 10% is for other initiatives. We do not currently have any longer-term capital expenditures or other cash requirements other than as set forth in the contractual obligations table. We also do not currently have any off-balance sheet arrangements.

Previous wording

We repurchased 399,633 shares during Fiscal 2025 at a cost of $9.8 million or an average of $24.49 per share. We were operating under a $100.0 million repurchase authorization from February 2022. In June 2023, we announced an additional $50.0 million share repurchase authorization. As of February 1, 2025, we have $42.3 million remaining under the expanded share repurchase authorization. We repurchased 1,261,295 shares during Fiscal 2024 at a cost of $32.0 million or an average of $25.39 per share. We repurchased 1,380,272 shares during Fiscal 2023 at a cost of $72.7 million or an average of $52.66 per share. During the first quarter of Fiscal 2026, through March 26, 2025, we repurchased 469,325 shares at a cost of $10.0 million or an average of $21.31 per share.

Current wording

We repurchased 604,531 shares during Fiscal 2026 at a cost of $12.6 million or an average of $20.79 per share. We were operating under a $100.0 million repurchase authorization from February 2022. In June 2023, we announced an additional $50.0 million share repurchase authorization. As of January 31, 2026, we have $29.8 million remaining under the expanded share repurchase authorization. We repurchased 399,633 shares during Fiscal 2025 at a cost of $9.8 million or an average of $24.49 per share. We repurchased 1,261,295 shares during Fiscal 2024 at a cost of $32.0 million or an average of $25.39 per share. During the first quarter of Fiscal 2027, through March 25, 2026, we did not repurchase any shares.

Previous wording

Cash and Cash Equivalents – Our cash and cash equivalent balances are held in our bank accounts and are invested primarily in institutional money market funds. We did not have significant exposure to changing interest rates on invested cash at February 1, 2025. As a result, we consider the interest rate risk implicit in these investments at February 1, 2025 to be low. We had cash equivalents of $7.5 million at February 1, 2025.

Current wording

Cash and Cash Equivalents – Our cash and cash equivalent balances are held in our bank accounts and are invested primarily in institutional money market funds. We did not have significant exposure to changing interest rates on invested cash at January 31, 2026. As a result, we consider the interest rate risk implicit in these investments at January 31, 2026 to be low. We had cash equivalents of $71.8 million at January 31, 2026.

Previous wording

Accounts Receivable – Our accounts receivable balance at February 1, 2025 is concentrated in our wholesale businesses, which sell primarily to department stores and independent retailers across the United States. In the wholesale businesses, one customer accounted for 27%, one customer accounted for 19%, one customer accounted for 11% and one customer accounted for 10% of our total trade receivables balance, while no other customer accounted for more than 7% of our total trade receivables balance as of February 1, 2025. We monitor the credit quality of our customers and establish an allowance for doubtful accounts based upon factors surrounding credit risk of specific customers, historical trends and other information, as well as customer specific factors; however, credit risk is affected by conditions or occurrences within the economy and the retail industry, as well as company-specific information.

Current wording

Accounts Receivable – Our accounts receivable balance at January 31, 2026 is concentrated in our wholesale businesses, which sell primarily to department stores and independent retailers across the United States. In the wholesale businesses, one customer accounted for 22%, one customer accounted for 13% and two customers each accounted for 10% of our total trade receivables balance, while no other customer accounted for more than 8% of our total trade receivables balance as of January 31, 2026. We monitor the credit quality of our customers and establish an allowance for doubtful accounts based upon factors surrounding credit risk of specific customers, historical trends and other information, as well as customer specific factors; however, credit risk is affected by conditions or occurrences within the economy and the retail industry, as well as company-specific information.

Previous wording

Foreign Currency Exchange Risk – We are exposed to translation risk because certain of our foreign operations utilize the local currency as their functional currency and those financial results must be translated into United States dollars. As currency exchange rates fluctuate, translation of our financial statements of foreign businesses into United States dollars affects the comparability of financial results between years. Schuh Group's net sales and operating income for Fiscal 2025 were positively impacted by $9.0 million and $0.2 million, respectively, due to the change in foreign exchange rates.

Current wording

Foreign Currency Exchange Risk – We are exposed to translation risk because certain of our foreign operations utilize the local currency as their functional currency and those financial results must be translated into United States dollars. As currency exchange rates fluctuate, translation of our financial statements of foreign businesses into United States dollars affects the comparability of financial results between years. Schuh Group's net sales for Fiscal 2026 were positively impacted by $21.2 million and the operating loss for Fiscal 2026 was negatively impacted by $0.2 million due to the change in foreign exchange rates.

Previous wording

Inherent in the retail inventory method are subjective judgments and estimates about the recoverability of the inventory and its market value, including merchandise mark-on, markups, markdowns and shrinkage. These judgments and estimates, coupled with the fact that the retail inventory method is an averaging process, could produce a range of cost figures. To reduce the risk of inaccuracy and to ensure consistent presentation, we employ the retail inventory method in multiple subclasses of inventory with similar gross margins. We analyze markdown requirements at the stock number level based on factors such as inventory

Current wording

Inherent in the retail inventory method are subjective judgments and estimates about the recoverability of the inventory and its market value, including merchandise mark-on, markups, markdowns and shrinkage. These judgments and estimates, coupled with the fact that the retail inventory method is an averaging process, could produce a range of cost figures. To reduce the risk of inaccuracy and to ensure consistent presentation, we employ the retail inventory method in multiple subclasses of inventory with similar gross margins. We analyze markdown requirements at the stock number level based on factors such as inventory turn, average selling price and inventory age and we accrue markdowns as necessary. These additional markdown accruals reflect all of the above factors as well as current agreements to return products to vendors and vendor agreements to provide markdown support. In addition to markdown allowances, we maintain reserves for shrinkage and damaged goods based on historical rates.