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Caleres Reports Strong Results in Third Quarter 2022

November 22, 2022
  • Delivers record quarterly consolidated net sales of $798.3 million
  • Improves inventory position with a 15.8 percent sequential decline from second quarter 2022
  • Returns $24.1 million to shareholders via share repurchases and dividends
  • Tightens fiscal year 2022 adjusted earnings per share outlook at upper end of previous guidance range

Caleres (NYSE: CAL), a diverse portfolio of consumer-driven footwear brands, today reported financial results for the third quarter ended October 29, 2022. During the quarter, Caleres continued its strong performance, achieving record quarterly sales and delivering another period of solid earnings. Net sales rose 1.8 percent year-over-year driven by positive momentum in the Brand Portfolio segment reflecting robust consumer demand for its fashion brands and products. The company achieved net income of $39.2 million, or earnings per diluted share of $1.08. Adjusted net income was $42.0 million, or adjusted earnings per diluted share of $1.15. Notably, Caleres improved its inventory position sequentially with total inventory levels declining 15.8 percent from the second quarter 2022.

“Caleres executed another strong operational and financial performance in the third quarter and closed the first nine months of the year with record earnings,” said Diane Sullivan, Chairman and Chief Executive Officer. “These results underscore the strength and versatility of our brands, highlight our compelling product and product creation power, and demonstrate the portfolio’s significantly enhanced agility and resilience during periods of macroeconomic uncertainty. We are particularly pleased that our Brand Portfolio segment achieved near-record third quarter earnings and that Famous Footwear delivered a strong operating margin of 12.3 percent.”

“We are encouraged by the recent market share gains from our brands and expect to build on this progress as we drive forward by enhancing the digital experience and elevating our product design and offerings,” said Jay Schmidt, President. “As we move through the remaining months of 2022, and in light of the more challenging macroeconomic environment, we will be even more focused on controlling our spending, prioritizing inventory management and leaning into our competitive advantages in order to drive long-term shareholder value.”

Third Quarter 2022 Highlights

(13-weeks ended October 29, 2022, compared to 13-weeks ended October 30, 2021)

  • Net sales were $798.3 million, up 1.8 percent from the third quarter of fiscal 2021;
    • A 2.6 percent sales decline in the Famous Footwear segment, with comparable store sales down 0.8 percent
    • A 7.6 percent sales increase in the Brand Portfolio segment
    • Direct-to-consumer sales represented approximately 74 percent of total net sales
  • Gross profit was $339.9 million, while gross margin was 42.6 percent;
    • A 44.7 percent gross margin in the Famous Footwear segment
    • A 37.9 percent gross margin in the Brand Portfolio segment
  • SG&A as percentage of sales was 35.5 percent, 307 basis points higher than third quarter of fiscal 2021;
  • Net earnings of $39.2 million, or earnings per diluted share of $1.08, compared to net earnings of $59.6 million, or earnings per diluted share of $1.54 in the third quarter of fiscal 2021;
  • Adjusted net earnings of $42.0 million, or adjusted earnings per diluted share of $1.15, compared to adjusted net earnings of $61.5 million, or adjusted earnings per diluted share of $1.59 in the third quarter of fiscal 2021;
  • Trailing twelve-month adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $298.6 million; or 10.1 percent of sales;
  • Inventory was up approximately 19.5 percent, in-line with expectations, and 15.8 percent below the second quarter of 2022 – representing significant sequential progress;
  • Returned $24.1 million to shareholders through dividends and share repurchases.

Capital Allocation Update

During the third quarter, Caleres continued to strategically invest in value-driving growth opportunities while at the same time returning $24.1 million to shareholders through share repurchases and dividend payments. Specifically, Caleres repurchased 838,025 shares of common stock, at a total cost of $21.6 million and an average share price of $25.72. Year-to-date, the company has repurchased 2.6 million shares, representing approximately 7 percent of shares outstanding, at an average share price of $24.11. In addition to buybacks, Caleres returned $2.5 million to shareholders through its recurring quarterly cash dividend during the third quarter.

Fiscal Year 2022 Outlook:

“Looking ahead, we are confident that Caleres is well-positioned to close 2022 with record-setting earnings,” said Sullivan. “We believe our curated family of brands, powerful platform and robust capabilities in the areas of brand building, production creation, marketing, and logistics will enable us to navigate any market environment. In short, the Caleres team is enthusiastic about its prospects for long-term profitability and confident in our ability to generate strong levels of cash and unlock further value for our shareholders.”

Given the strong execution to date and expectations for the fourth quarter, Caleres is tightening its fiscal year 2022 earnings outlook at the upper end of its previous guidance range.

Specifically, the company expects adjusted earnings per share to be in the range of $4.30 and $4.40, representing another year of record earnings for the organization. In addition, the company is reiterating its full year sales outlook, with the range still expected to be between 4 percent and 6 percent as compared to fiscal year 2021.

The company anticipates continued improvement in its inventory position and expects to end fiscal year 2022 with inventory up mid-single digit percent as compared to fiscal year 2021.

Investor Conference Call

Caleres will host a conference call at 10:00 a.m. ET today, Tuesday, November 22. The webcast and associated slides will be available at investor.caleres.com/news/events. A live conference call will be available at (877) 704-4453 for North America participants or (201) 389-0920 for international participants, no passcode necessary. A replay will be also available at investor.caleres.com/news/events/archive for a limited period. Investors may also access the replay by dialing (844) 512-2921 in North America or (412) 317-6671 internationally and using the conference pin 13734096.

Definitions

All references in this press release, outside of the condensed consolidated financial statements that follow, unless otherwise noted, related to net earnings attributable to Caleres, Inc. and diluted earnings per common share attributable to Caleres, Inc. shareholders, are presented as net earnings and earnings per diluted share, respectively.

Non-GAAP Financial Measures

In this press release, the company’s financial results are provided both in accordance with generally accepted accounting principles (GAAP) and using certain non-GAAP financial measures. In particular, the company provides historic and estimated future gross profit, operating earnings, net earnings and earnings per diluted share, earnings before interest, taxes, depreciation and amortization adjusted to exclude certain gains, charges, and recoveries, which are non-GAAP financial measures. These results are included as a complement to results provided in accordance with GAAP because management believes these non-GAAP financial measures help identify underlying trends in the company’s business and provide useful information to both management and investors by excluding certain items that may not be indicative of the company’s core operating results. These measures should not be considered a substitute for or superior to GAAP results.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

This press release contains certain forward-looking statements and expectations regarding the company’s future performance and the performance of its brands. Such statements are subject to various risks and uncertainties that could cause actual results to differ materially. These risks include (i) supply chain disruptions and inflationary pressures; (ii) the coronavirus pandemic and its adverse impact on our business operations and financial condition (iii) changing consumer demands, which may be influenced by general economic conditions and other factors; (iv) rapidly changing consumer preferences and purchasing patterns and fashion trends; (v) customer concentration and increased consolidation in the retail industry; (vi) intense competition within the footwear industry; (vii) foreign currency fluctuations; (viii) political and economic conditions or other threats to the continued and uninterrupted flow of inventory from China and other countries, where the company relies heavily on third-party manufacturing facilities for a significant amount of its inventory; (ix) cybersecurity threats or other major disruption to the company’s information technology systems; (x) the ability to accurately forecast sales and manage inventory levels; (xi) a disruption in the company’s distribution centers; (xii) the ability to recruit and retain senior management and other key associates; (xiii) the ability to secure/exit leases on favorable terms; (xiv) the ability to maintain relationships with current suppliers; (xv) transitional challenges with acquisitions and divestitures; (xvi) changes to tax laws, policies and treaties; (xvii) compliance with applicable laws and standards with respect to labor, trade and product safety issues; and (xviii) the ability to attract, retain, and maintain good relationships with licensors and protect our intellectual property rights. The company's reports to the Securities and Exchange Commission contain detailed information relating to such factors, including, without limitation, the information under the caption Risk Factors in Item 1A of the company’s Annual Report on Form 10-K for the year ended January 29, 2022, which information is incorporated by reference herein and updated by the company’s Quarterly Reports on Form 10-Q. The company does not undertake any obligation or plan to update these forward-looking statements, even though its situation may change.

SCHEDULE 1

 

CALERES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

Thirteen Weeks Ended

 

Thirty-Nine Weeks Ended

($ thousands, except per share data)

 

October 29, 2022

 

October 30, 2021

 

October 29, 2022

 

October 30, 2021

Net sales

 

$

798,258

 

 

$

784,156

 

 

$

2,271,704

 

 

$

2,098,323

 

Cost of goods sold

 

 

458,382

 

 

 

448,805

 

 

 

1,268,019

 

 

 

1,165,792

 

Gross profit

 

 

339,876

 

 

 

335,351

 

 

 

1,003,685

 

 

 

932,531

 

Selling and administrative expenses

 

 

283,119

 

 

 

254,033

 

 

 

812,313

 

 

 

757,070

 

Restructuring and other special charges, net

 

 

2,910

 

 

 

 

 

 

2,910

 

 

 

13,482

 

Operating earnings

 

 

53,847

 

 

 

81,318

 

 

 

188,462

 

 

 

161,979

 

Interest expense, net

 

 

(4,003

)

 

 

(5,069

)

 

 

(8,886

)

 

 

(28,803

)

Loss on early extinguishment of debt

 

 

 

 

 

(649

)

 

 

 

 

 

(649

)

Other income, net

 

 

2,997

 

 

 

3,844

 

 

 

9,636

 

 

 

11,533

 

Earnings before income taxes

 

 

52,841

 

 

 

79,444

 

 

 

189,212

 

 

 

144,060

 

Income tax provision

 

 

(13,849

)

 

 

(19,759

)

 

 

(48,683

)

 

 

(39,838

)

Net earnings

 

 

38,992

 

 

 

59,685

 

 

 

140,529

 

 

 

104,222

 

Net (loss) earnings attributable to noncontrolling interests

 

 

(254

)

 

 

63

 

 

 

(404

)

 

 

1,057

 

Net earnings attributable to Caleres, Inc.

 

$

39,246

 

 

$

59,622

 

 

$

140,933

 

 

$

103,165

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share attributable to Caleres, Inc. shareholders

 

$

1.09

 

 

$

1.56

 

 

$

3.83

 

 

$

2.70

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per common share attributable to Caleres, Inc. shareholders

 

$

1.08

 

 

$

1.54

 

 

$

3.79

 

 

$

2.68

 

SCHEDULE 2

 

CALERES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

 

 

 

 

 

 

(Unaudited)

($ thousands)

 

October 29, 2022

 

October 30, 2021

ASSETS

 

 

 

 

 

 

Cash and cash equivalents

 

$

32,773

 

$

74,772

Receivables, net

 

 

161,367

 

 

161,892

Inventories, net

 

 

649,257

 

 

543,218

Property and equipment, held for sale

 

 

16,777

 

 

Prepaid expenses and other current assets

 

 

60,910

 

 

82,816

Total current assets

 

 

921,084

 

 

862,698

 

 

 

 

 

 

 

Lease right-of-use assets

 

 

523,011

 

 

500,308

Property and equipment, net

 

 

151,798

 

 

155,516

Goodwill and intangible assets, net

 

 

218,420

 

 

230,625

Other assets

 

 

134,000

 

 

125,411

Total assets

 

$

1,948,313

 

$

1,874,558

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

Borrowings under revolving credit agreement

 

$

364,500

 

$

175,000

Current portion of long-term debt

 

 

 

 

99,598

Mandatory purchase obligation - Blowfish Malibu

 

 

 

 

54,558

Trade accounts payable

 

 

279,704

 

 

352,084

Lease obligations

 

 

133,227

 

 

128,151

Other accrued expenses

 

 

261,483

 

 

260,669

Total current liabilities

 

 

1,038,914

 

 

1,070,060

 

 

 

 

 

 

 

Noncurrent lease obligations

 

 

453,718

 

 

452,786

Other liabilities

 

 

50,270

 

 

45,967

Total other liabilities

 

 

503,988

 

 

498,753

 

 

 

 

 

 

 

Total Caleres, Inc. shareholders’ equity

 

 

398,444

 

 

301,098

Noncontrolling interests

 

 

6,967

 

 

4,647

Total equity

 

 

405,411

 

 

305,745

Total liabilities and equity

 

$

1,948,313

 

$

1,874,558

SCHEDULE 3

 

CALERES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

Thirty-Nine Weeks Ended

($ thousands)

 

October 29, 2022

 

October 30, 2021

OPERATING ACTIVITIES:

 

 

 

 

 

 

Net cash provided by operating activities

 

$

46,266

 

 

$

189,728

 

 

 

 

 

 

 

 

INVESTING ACTIVITIES:

 

 

 

 

 

 

Purchases of property and equipment

 

 

(40,056

)

 

 

(10,437

)

Capitalized software

 

 

(5,350

)

 

 

(4,122

)

Net cash used for investing activities

 

 

(45,406

)

 

 

(14,559

)

 

 

 

 

 

 

 

FINANCING ACTIVITIES:

 

 

 

 

 

 

Borrowings under revolving credit agreement

 

 

708,500

 

 

 

363,000

 

Repayments under revolving credit agreement

 

 

(634,000

)

 

 

(438,000

)

Redemption of senior notes

 

 

 

 

 

(100,000

)

Dividends paid

 

 

(7,698

)

 

 

(8,011

)

Debt issuance costs

 

 

 

 

 

(1,190

)

Acquisition of treasury stock

 

 

(63,225

)

 

 

 

Issuance of common stock under share-based plans, net

 

 

(4,804

)

 

 

(3,779

)

Contributions by noncontrolling interests, net

 

 

3,142

 

 

 

 

Other

 

 

 

 

 

(676

)

Net cash provided by (used for) financing activities

 

 

1,915

 

 

 

(188,656

)

Effect of exchange rate changes on cash and cash equivalents

 

 

(117

)

 

 

(36

)

Increase (decrease) in cash and cash equivalents

 

 

2,658

 

 

 

(13,523

)

Cash and cash equivalents at beginning of period

 

 

30,115

 

 

 

88,295

 

Cash and cash equivalents at end of period

 

$

32,773

 

 

$

74,772

 

SCHEDULE 4

 

CALERES, INC.

RECONCILIATION OF NET EARNINGS AND DILUTED EARNINGS PER SHARE (GAAP BASIS) TO ADJUSTED NET EARNINGS AND ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP BASIS)

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

Thirteen Weeks Ended

 

October 29, 2022

 

October 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-Tax

 

Net Earnings

 

 

 

Pre-Tax

 

Net Earnings

 

 

 

Impact of

 

Attributable

 

Diluted

 

Impact of

 

Attributable

 

Diluted

 

Charges/Other

 

to Caleres,

 

Earnings

 

Charges/Other

 

to Caleres,

 

Earnings

($ thousands, except per share data)

Items

 

Inc.

 

Per Share

 

Items

 

Inc.

 

Per Share

 

 

 

 

 

 

 

 

 

GAAP earnings

 

 

$

39,246

 

$

1.08

 

 

 

$

59,622

 

$

1.54

 

 

 

 

 

 

 

 

 

 

 

 

Charges/other items:

 

 

 

 

 

 

 

 

 

 

 

Organizational changes

$

2,910

 

 

2,723

 

 

0.07

 

$

 

 

 

 

Fair value adjustment to Blowfish purchase obligation

 

 

 

 

 

 

 

1,918

 

 

1,424

 

 

0.04

Loss on early extinguishment of debt

 

 

 

 

 

 

 

649

 

 

482

 

 

0.01

Total charges/other items

$

2,910

 

$

2,723

 

$

0.07

 

$

2,567

 

$

1,906

 

$

0.05

Adjusted earnings

 

 

$

41,969

 

$

1.15

 

 

 

$

61,528

 

$

1.59

 

 

 

 

 

 

 

(Unaudited)

 

 

Thirty-Nine Weeks Ended

 

 

October 29, 2022

 

October 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-Tax

 

Net Earnings

 

 

 

Pre-Tax

 

Net Earnings

 

 

 

 

Impact of

 

Attributable

 

Diluted

 

Impact of

 

Attributable

 

Diluted

 

 

Charges/Other

 

to Caleres,

 

Earnings

 

Charges/Other

 

to Caleres,

 

Earnings

($ thousands, except per share data)

 

Items

 

Inc.

 

Per Share

 

Items

 

Inc.

 

Per Share

 

 

 

 

 

GAAP earnings

 

 

 

$

140,933

 

$

3.79

 

 

 

$

103,165

 

$

2.68

 

 

 

 

 

 

 

 

 

 

 

 

 

Charges/other items:

 

 

 

 

 

 

 

 

 

 

 

 

Organizational changes

 

$

2,910

 

 

2,723

 

 

0.07

 

$

 

 

 

$

Fair value adjustment to Blowfish purchase obligation

 

 

 

 

 

 

 

 

15,423

 

 

11,454

 

 

0.30

Brand Portfolio - business exits

 

 

 

 

 

 

 

 

13,482

 

 

11,927

 

 

0.31

Loss on early extinguishment of debt

 

 

 

 

 

 

 

 

649

 

 

482

 

 

0.01

Deferred tax valuation allowances

 

 

 

 

 

 

 

 

 

 

3,294

 

 

0.08

Total charges/other items

 

$

2,910

 

$

2,723

 

$

0.07

 

$

29,554

 

$

27,157

 

$

0.70

Adjusted earnings

 

 

 

$

143,656

 

$

3.86

 

 

 

$

130,322

 

$

3.38

 

 

(Unaudited)

 

 

Trailing Twelve Months

 

 

October 29, 2022

 

October 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-Tax

 

Net Earnings

 

 

Pre-Tax

 

Net Earnings

 

 

Impact of

 

Attributable

 

 

Impact of

 

Attributable

 

 

Charges/Other

 

to Caleres,

 

 

Charges/Other

 

to Caleres,

($ thousands)

 

Items

 

Inc.

 

 

Items

 

Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP earnings

 

 

 

 

$

174,787

 

 

 

 

 

$

26,189

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Charges/other items:

 

 

 

 

 

 

 

 

 

 

 

 

 

Organizational changes

 

$

2,910

 

 

2,723

 

 

$

 

 

Loss on early extinguishment of debt

 

 

362

 

 

268

 

 

 

649

 

 

482

Deferred tax valuation allowances

 

 

 

 

746

 

 

 

 

 

3,294

Brand Portfolio - business exits

 

 

 

 

 

 

 

28,256

 

 

25,607

Fair value adjustment to Blowfish purchase obligation

 

 

 

 

 

 

 

24,412

 

 

18,129

Intangible asset impairment charges

 

 

 

 

 

 

 

23,805

 

 

17,854

COVID-19-related expenses

 

 

 

 

 

 

 

15,245

 

 

37,486

Vionic integration-related costs

 

 

 

 

 

 

 

3,436

 

 

2,552

Total charges/other items

 

$

3,272

 

$

3,737

 

 

$

95,803

 

$

105,404

Adjusted earnings

 

 

 

 

$

178,524

 

 

 

 

 

$

131,593

SCHEDULE 5

 

CALERES, INC.

SUMMARY FINANCIAL RESULTS BY SEGMENT

 

SUMMARY FINANCIAL RESULTS

 

 

 

 

(Unaudited)

 

 

 

Thirteen Weeks Ended

 

 

 

Famous Footwear

 

Brand Portfolio

 

Eliminations and Other

 

Consolidated

 

 

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

($ thousands)

 

2022

 

2021

 

2022

 

2021

 

2022

 

2021

 

2022

 

2021

 

Net sales

 

$

481,951

 

 

$

494,660

 

$

323,242

 

$

300,513

 

$

(6,935

)

 

$

(11,017

)

 

$

798,258

 

$

784,156

 

Gross profit

 

 

215,603

 

 

 

235,487

 

 

122,359

 

 

98,898

 

 

1,914

 

 

 

966

 

 

 

339,876

 

 

335,351

 

Adjusted gross profit

 

 

215,603

 

 

 

235,487

 

 

122,359

 

 

98,898

 

 

1,914

 

 

 

966

 

 

 

339,876

 

 

335,351

 

Gross profit rate

 

 

44.7

 

%

 

47.6

%

 

37.9

%

 

32.9

%

 

(27.6

)

%

 

(8.8

)

%

 

42.6

%

 

42.8

%

Adjusted gross profit rate

 

 

44.7

 

%

 

47.6

%

 

37.9

%

 

32.9

%

 

(27.6

)

%

 

(8.8

)

%

 

42.6

%

 

42.8

%

Operating earnings (loss)

 

 

59,267

 

 

 

87,375

 

 

22,304

 

 

11,383

 

 

(27,724

)

 

 

(17,440

)

 

 

53,847

 

 

81,318

 

Adjusted operating earnings (loss)

 

 

59,267

 

 

 

87,375

 

 

22,304

 

 

11,383

 

 

(24,814

)

 

 

(17,440

)

 

 

56,757

 

 

81,318

 

Operating earnings %

 

 

12.3

 

%

 

17.7

%

 

6.9

%

 

3.8

%

 

n/m

 

%

 

n/m

 

%

 

6.7

%

 

10.4

%

Adjusted operating earnings %

 

 

12.3

 

%

 

17.7

%

 

6.9

%

 

3.8

%

 

n/m

 

%

 

n/m

 

%

 

7.1

%

 

10.4

%

Same-store sales % (on a 13-week basis)

 

 

(0.8

)

%

 

26.5

%

 

26.0

%

 

45.8

%

 

 

%

 

 

%

 

%

 

%

Number of stores

 

 

876

 

 

 

905

 

 

89

 

 

90

 

 

 

 

 

 

 

 

965

 

 

995

 

 

n/m – Not meaningful

RECONCILIATION OF ADJUSTED RESULTS (NON-GAAP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

Thirteen Weeks Ended

 

 

Famous Footwear

 

Brand Portfolio

 

Eliminations and Other

 

Consolidated

 

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

October 29,

 

October 30,

($ thousands)

 

2022

 

2021

 

2022

 

2021

 

2022

 

 

2021

 

2022

 

2021

Gross profit

 

$

215,603

 

$

235,487

 

$

122,359

 

$

98,898

 

$

1,914

 

 

$

966

 

 

$

339,876

 

$

335,351

Charges/Other Items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brand Portfolio - business exits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total charges/other items

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted gross profit

 

$

215,603

 

$

235,487

 

$

122,359

 

$

98,898

 

$

1,914

 

 

$

966

 

 

$

339,876

 

$

335,351

Operating earnings (loss)

 

$

59,267

 

$

87,375

 

$

22,304

 

$

11,383

 

$

(27,724

)

 

$

(17,440

)

 

$

53,847

 

$

81,318

Charges/Other Items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Organizational changes

 

 

 

 

 

 

 

 

 

 

2,910

 

 

 

 

 

 

2,910

 

 

Total charges/other items

 

 

 

 

 

 

 

 

 

 

2,910

 

 

 

 

 

 

2,910

 

 

Adjusted operating earnings (loss)

 

$

59,267

 

$

87,375

 

$

22,304

 

$

11,383

 

$

(24,814

)

 

$

(17,440

)

 

$

56,757

 

$

81,318

SCHEDULE 5

 

CALERES, INC.

SUMMARY FINANCIAL RESULTS BY SEGMENT

 

SUMMARY FINANCIAL RESULTS

 

 

 

 

(Unaudited)

 

 

 

Thirty-Nine Weeks Ended

 

 

 

Famous Footwear

 

Brand Portfolio

 

Eliminations and Other

 

Consolidated

 

 

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

($ thousands)

 

2022

 

2021

 

2022

 

2021

 

2022

 

2021

 

2022

 

2021

 

Net sales

 

$

1,302,828

 

 

$

1,346,413

 

$

1,013,043

 

$

789,832

 

$

(44,167

)

 

$

(37,922

)

 

$

2,271,704

 

$

2,098,323

 

Gross profit

 

 

618,442

 

 

 

642,715

 

 

385,800

 

 

287,791

 

 

(557

)

 

 

2,025

 

 

 

1,003,685

 

 

932,531

 

Adjusted gross profit

 

 

618,442

 

 

 

642,715

 

 

385,800

 

 

287,791

 

 

(557

)

 

 

2,025

 

 

 

1,003,685

 

 

932,531

 

Gross profit rate

 

 

47.5

 

%

 

47.7

%

 

38.1

%

 

36.4

%

 

1.3

 

%

 

(5.3

)

%

 

44.2

%

 

44.4

%

Adjusted gross profit rate

 

 

47.5

 

%

 

47.7

%

 

38.1

%

 

36.4

%

 

1.3

 

%

 

(5.3

)

%

 

44.2

%

 

44.4

%

Operating earnings (loss)

 

 

171,451

 

 

 

220,746

 

 

93,063

 

 

25,116

 

 

(76,052

)

 

 

(83,883

)

 

 

188,462

 

 

161,979

 

Adjusted operating earnings (loss)

 

 

171,451

 

 

 

220,746

 

 

93,063

 

 

38,598

 

 

(73,142

)

 

 

(83,883

)

 

 

191,372

 

 

175,461

 

Operating earnings %

 

 

13.2

 

%

 

16.4

%

 

9.2

%

 

3.2

%

 

n/m

 

%

 

n/m

 

%

 

8.3

%

 

7.7

%

Adjusted operating earnings %

 

 

13.2

 

%

 

16.4

%

 

9.2

%

 

4.9

%

 

n/m

 

%

 

n/m

 

%

 

8.4

%

 

8.4

%

Same-store sales % (on a 39-week basis)

 

 

(2.5

)

%

 

11.5

%

 

36.4

%

 

24.3

%

 

 

%

 

 

%

 

%

 

%

Number of stores

 

 

876

 

 

 

905

 

 

89

 

 

90

 

 

 

 

 

 

 

 

965

 

 

995

 

 

n/m – Not meaningful

RECONCILIATION OF ADJUSTED RESULTS (NON-GAAP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

Thirty-Nine Weeks Ended

 

 

Famous Footwear

 

Brand Portfolio

 

Eliminations and Other

 

Consolidated

 

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

October 29,

 

October 30,

($ thousands)

 

2022

 

2021

 

2022

 

2021

 

2022

 

2021

 

2022

 

2021

Gross profit

 

$

618,442

 

$

642,715

 

$

385,800

 

$

287,791

 

$

(557

)

 

$

2,025

 

 

$

1,003,685

 

$

932,531

Charges/Other Items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brand Portfolio - brand exits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total charges/other items

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted gross profit

 

$

618,442

 

$

642,715

 

$

385,800

 

$

287,791

 

$

(557

)

 

$

2,025

 

 

$

1,003,685

 

$

932,531

Operating earnings (loss)

 

$

171,451

 

$

220,746

 

$

93,063

 

$

25,116

 

$

(76,052

)

 

$

(83,883

)

 

$

188,462

 

$

161,979

Charges/Other Items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Organizational changes

 

 

 

 

 

 

 

 

 

 

2,910

 

 

 

 

 

 

2,910

 

 

Brand Portfolio - business exits

 

 

 

 

 

 

 

 

13,482

 

 

 

 

 

 

 

 

 

 

13,482

Total charges/other items

 

 

 

 

 

 

 

 

13,482

 

 

2,910

 

 

 

 

 

 

2,910

 

 

13,482

Adjusted operating earnings (loss)

 

$

171,451

 

$

220,746

 

$

93,063

 

$

38,598

 

$

(73,142

)

 

$

(83,883

)

 

$

191,372

 

$

175,461

SCHEDULE 6

 

CALERES, INC.

BASIC AND DILUTED EARNINGS PER SHARE RECONCILIATION

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

Thirteen Weeks Ended

 

Thirty-Nine Weeks Ended

 

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

 

2022

 

2021

 

2022

 

2021

($ thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings attributable to Caleres, Inc.:

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings

 

$

38,992

 

 

$

59,685

 

 

$

140,529

 

 

$

104,222

 

Net loss (earnings) attributable to noncontrolling interests

 

 

254

 

 

 

(63

)

 

 

404

 

 

 

(1,057

)

Net earnings attributable to Caleres, Inc.

 

 

39,246

 

 

 

59,622

 

 

 

140,933

 

 

 

103,165

 

Net earnings allocated to participating securities

 

 

(1,723

)

 

 

(2,140

)

 

 

(5,951

)

 

 

(3,737

)

Net earnings attributable to Caleres, Inc. after allocation of earnings to participating securities

 

$

37,523

 

 

$

57,482

 

 

$

134,982

 

 

$

99,428

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted common shares attributable to Caleres, Inc.:

 

 

 

 

 

 

 

 

 

 

 

 

Basic common shares

 

 

34,379

 

 

 

36,889

 

 

 

35,207

 

 

 

36,825

 

Dilutive effect of share-based awards

 

 

507

 

 

 

457

 

 

 

450

 

 

 

294

 

Diluted common shares attributable to Caleres, Inc.

 

 

34,886

 

 

 

37,346

 

 

 

35,657

 

 

 

37,119

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share attributable to Caleres, Inc. shareholders

 

$

1.09

 

 

$

1.56

 

 

$

3.83

 

 

$

2.70

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per common share attributable to Caleres, Inc. shareholders

 

$

1.08

 

 

$

1.54

 

 

$

3.79

 

 

$

2.68

 

SCHEDULE 7

 

CALERES, INC.

BASIC AND DILUTED ADJUSTED EARNINGS PER SHARE RECONCILIATION

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

Thirteen Weeks Ended

 

Thirty-Nine Weeks Ended

 

 

October 29,

 

October 30,

 

October 29,

 

October 30,

 

 

2022

 

2021

 

2022

 

2021

($ thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net earnings attributable to Caleres, Inc.:

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net earnings

 

$

41,715

 

 

$

61,591

 

 

$

143,252

 

 

$

131,379

 

Net loss (earnings) attributable to noncontrolling interests

 

 

254

 

 

 

(63

)

 

 

404

 

 

 

(1,057

)

Adjusted net earnings attributable to Caleres, Inc.

 

 

41,969

 

 

 

61,528

 

 

 

143,656

 

 

 

130,322

 

Net earnings allocated to participating securities

 

 

(1,842

)

 

 

(2,208

)

 

 

(6,067

)

 

 

(4,729

)

Adjusted net earnings attributable to Caleres, Inc. after allocation of earnings to participating securities

 

$

40,127

 

 

$

59,320

 

 

$

137,589

 

 

$

125,593

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted common shares attributable to Caleres, Inc.:

 

 

 

 

 

 

 

 

 

 

 

 

Basic common shares

 

 

34,379

 

 

 

36,889

 

 

 

35,207

 

 

 

36,825

 

Dilutive effect of share-based awards

 

 

507

 

 

 

457

 

 

 

450

 

 

 

294

 

Diluted common shares attributable to Caleres, Inc.

 

 

34,886

 

 

 

37,346

 

 

 

35,657

 

 

 

37,119

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic adjusted earnings per common share attributable to Caleres, Inc. shareholders

 

$

1.17

 

 

$

1.61

 

 

$

3.91

 

 

$

3.41

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted adjusted earnings per common share attributable to Caleres, Inc. shareholders

 

$

1.15

 

 

$

1.59

 

 

$

3.86

 

 

$

3.38

 

SCHEDULE 8

 

CALERES, INC.

CALCULATION OF EBITDA AND ADJUSTED EBITDA (NON-GAAP METRICS)

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

Trailing Twelve Months Ended

($ thousands)

 

October 29, 2022

 

October 30, 2021

EBITDA:

 

 

 

 

 

 

 

 

Net earnings attributable to Caleres, Inc.

 

$

174,787

 

 

$

26,189

 

Income tax provision

 

 

59,926

 

 

 

51,114

 

Interest expense, net

 

 

11,013

 

 

 

43,343

 

Loss on early extinguishment of debt

 

 

362

 

 

 

649

 

Depreciation and amortization (1)

 

 

49,552

 

 

 

53,900

 

EBITDA

 

$

295,640

 

 

$

175,195

 

 

 

 

 

 

 

 

 

 

EBITDA margin

 

 

10.0

%

 

 

6.6

%

 

 

 

 

 

 

 

 

 

Adjusted EBITDA:

 

 

 

 

 

 

 

 

Adjusted net earnings attributable to Caleres, Inc. (2)

 

$

178,524

 

 

$

131,593

 

Income tax provision (3)

 

 

59,461

 

 

 

41,514

 

Interest expense, net (4)

 

 

11,013

 

 

 

18,932

 

Depreciation and amortization (1)

 

 

49,552

 

 

 

53,900

 

Adjusted EBITDA

 

$

298,550

 

 

$

245,939

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA margin

 

 

10.1

%

 

 

9.2

%

______________________
(1)

Includes depreciation and amortization of capitalized software and intangible assets.

(2)

Refer to Schedule 4 for the consolidated reconciliation of net earnings attributable to Caleres, Inc. to adjusted net earnings attributable to Caleres, Inc.

(3)

Excludes the income tax impacts of the adjustments on Schedule 4.

(4)

Excludes the fair value adjustment to the Blowfish purchase obligation, as reflected on Schedule 4.

 

Investor Contact:
Logan Bonacorsi
lbonacorsi@caleres.com

Source: Caleres

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