Warm fall weather and a lively hurricane season resulted in flat Q3 earnings for Caleres, parent company to shoe brands like Sam Edelman and Via Spiga.
Net earnings were $34.4 million, marginally down compared to $34.8 million during the same period last year. Diluted earnings per share for the third quarter were $0.80.
Topline sales came in around $35 million, negatively impacted by warmer fall weather and the devastating hurricane season, according to CEO, President and Chairman Diane Sullivan. However, Sullivan noted that November sales are improving.
Meanwhile, brand portfolio sales grew 14 percent to $301.5 million, including Allen Edmonds, which Caleres acquired in December of last year. Consolidated sales of $774.7 million grew 5.8%, including Allen Edmonds.
Famous Footwear sales of $473.1 million grew 1.1%, while back-to-school same-store-sales grew 2.6% and third quarter same-store-sales were also up 0.9%.
“Our strong start to the third quarter in August was interrupted by hurricanes in September and an unseasonably warm start to fall in October. Even though the quarter became progressively more challenging, we delivered improvement in gross margin and generated strong cash flow, while paying down our revolver borrowings,” said Sullivan.
Gross profit reached $316.9 million in the third quarter, up compared to $293.8 million last year. Meanwhile gross margin was 40.9%, up 79 basis points.
Operating earnings were $52.9 million, while operating margin was 6.8%.
Outlook
Consolidated net sales are expected to be between $2.7 billion to $2.8 billion. Famous Footwear same-store sales are anticipated to be in the low-single digits. Meanwhile, brand portfolio sales are expected to grow in the high-teens. Caleres expects gross margin to increase 70 to 80 bps. Adjusted earnings per diluted share are expected to be in between $2.10 to $2.20.