As other footwear companies name slow foot traffic and delayed tax returns as reasons to their slow start to the fiscal year, Caleres says the company is on course for a successful 2017.
The company reported Thursday net earnings of $14.9 million, or $0.35 cents per share, included $2.5 million after-tax of expected charges related to the acquisition and integration of men’s brand Allen Edmonds, compared with $17.78 million, or $0.41 per share, for the same period last year. Adjusted net earnings of $17.4 million were down 2 percent.
Consolidated sales of $631.5 million were up 8 percent, including $42.5 million of Allen Edmonds sales, which Caleres acquired in December 2016. Gross profit of $270.9 million was up 9.3%. Operating earnings of $25.7 million, with adjusted operating earnings of $29.9 million.
“Our first quarter results—including 8 percent sales growth and more than 50 basis points of gross margin improvement—provided a solid start to the year, despite the continued tough retail environment,” said Diane Sullivan, Caleres CEO, president and chairman.
“We are pleased with the performance of our Allen Edmonds acquisition, the success of our integration to date, and with our continued shift toward more balanced earnings contribution from both Famous Footwear and Brand Portfolio. And although retail continues to rapidly and significantly evolve, we remain on track for 2017.”
E-commerce was a driver in Caleres’ retail arm, Famous Footwear. The retailer’s total sales for the quarter increased 0.5% to $366.5 million. Same-store sales were down 0.6%, while famous.com sales increased 25.7%. Famous Footwear gross margin of 45.8% was down 51 basis points, primarily reflecting increased shipping expense related to continued sales growth at famous.com.
Caleres’ Brand Portfolio, which includes Sam Edelman, Vince and Via Spiga, increased 20.4% to $265 million. E-commerce was up 56.3% and represented 25.8% of total sales.
The company expects revenue to be in the range of $2,700 million to $2,800 million for financial year 2017. For financial year 2017, the company estimates diluted earnings per share to be in the range of $2.10 to $2.20 on adjusted basis.