Genesco, Inc.

Based in Nashville, Tennessee, Genesco designs, markets and distributes footwear under its own and licensed brands. The Company operates in 4 segments: Journeys; Jarman (comprised primarily of the Jarman and Underground station retail footwear chains); Johnston & Murphy (comprised of Johnston & Murphy retail stores, direct marketing and wholesale distribution); and Licensed Brands (comprised of Dockers). Retail footwear accounted for 60% of 2000 fiscal revenues and branded footwear, 40%.

In 2002, Federal regulators accused three division officers at shoe marketer Genesco Inc. of fraudulently reporting 2001 sales figures (Genesco was not named in the suit). The actions allowed the company to improperly record $2.8 million in sales, the lawsuit charged. The SEC said the scheme unfolded during the final weeks of the fourth quarter that ended Feb. 3, 2001, when 2 executives indicated that the wholesale division would not meet its budgeted sales figures. Projections showed a $2 million shortfall against a $6.8 million target for the fiscal year's last month.

The lawsuit charges that company sent orders to a major customer early after the customer refused the shipment and improperly booked the sales on the last day of Genesco's 2001 fiscal year.

Five days earlier, the company said it expected its earnings to meet or beat Wall Street's estimates of 53 cents a share for the quarter, the lawsuit charged.

On March 7, 2001, Genesco reported quarterly earnings of 59 cents a share. The company's stock closed up $1 that day at $26.40. By the end of May, the stock had topped $31.

But in November 2001, the company forecast lower earnings and sales than analysts had expected for the current and next fiscal years.

In a prepared statement released the following month, Genesco said it would revise previously reported revenues in fiscal 2002 to correct an accounting problem at its Johnston & Murphy wholesale operations and would investigate "erroneous entries" for the previous fiscal year.

Genesco said the problem stemmed from the timing of shipments by its Johnston & Murphy division and involved less than 1 percent of reported revenues for fiscal year 2001.


Certificate: Senior Sinking Fund Debenture Bond, issued in the 1970’s

Printer: American Bank Note Company

Dimensions: 8” (h) x 12” (w)

State: TN-Tennessee

Subject Matter: Clothing and Accessories | Shoe Companies | Scandals and Collapses

Vignette Topic(s): Allegorical Featured | Allegorical Mercury | Skyline Scene

Condition: Vertical fold lines, punch hole cancels in the signature areas and body, and some toning and edge faults from age.