Genesco curiously decided to enter the hat business in 2004 and spent $283 million in various acquisitions to build up the segment. After 15 years in this unrelated business and an abysmal track record of poor performance, Genesco exited the business in 2019 for $101 million in cash.
With the Lids segment long-ago divested, the footwear-centric focus allows for material shared services, including, but not limited to, overhead and the digital backbone.
We remain constructive on the name, considering the company's outperformance during the pandemic and opportunities in the post-pandemic world, overlaid with a still attractive valuation.
While we may say that Asia lags behind the Western hemisphere, I would say there's been a greater awareness of ESG and indeed more companies are adopting sustainability and ESG practices.
