• Second-quarter net profit reached $9.7m
  • Sales inched up 0.4% to $886m
  • Comparable sales up 2.9% 

US footwear group Collective Brands has swung to a second-quarter net profit despite closing hundreds of stores.

The company, which operates Payless stores, as well as the the Sperry Top-Sider and Keds brands, booked a US$9.7m net profit for the quarter ended 28 July, against a loss of $35m over the same period of the prior year.

Sales increased 0.4% to $886m, driven by a 2.9% comparable store sales increase and a 6.1% rise in its Performance + Lifestyle Group wholesale segment. The gains came despite the company operating 375 fewer stores than at the same time last year.

"Our second quarter results illustrate the progress that Collective Brands is making in executing the turnaround of the Payless business and continuing the growth in the Performance + Lifestyle Group," said CEO Michael Massey.

"The results reinforce the point that the new Payless strategy is working domestically as we are re-connecting with our core budget-conscious consumer through more relevant price points and styles. 

"As we implemented the Payless strategy in Latin America during the quarter, we saw strong comparable store sales results. Within PLG, Sperry Top-Sider continues to deliver strong growth and we are again posting double-digit comparable store sales gains at Stride Rite retail stores, demonstrating their resurgence."

The company said it expects to complete the sale of the company to Wolverine Worldwide and private investment firms Blum Capital Partners and Golden Gate Capital late in the third quarter or early in the fourth quarter. It agreed to the sale, in a deal worth US$2bn, in May this year.