“The third quarter saw progress toward our strategy highlighted by the Brand Portfolio delivering growth, Famous Footwear delivering positive comparable store sales, and both segments increasing market share. That said, performance was below our expectations reflecting softer seasonal demand in the boot category, late receipts of key athletic products at Famous Footwear, and a discrete customer credit issue that impacted shipments. In addition, our business in China was also weaker than planned”, commented Jay Schmidt, President and Chief Executive Officer.

Third Quarter Results

In the quarter ended on the 2^nd of November, Caleres’ net sales totalled 740.9 million US dollars, a decrease of 2.8% on a comparable basis to the same period of 2023.

While third quarter net sales in the famous footwear segment declined by 4.8%, as compared to the same quarter of the prior year, with comparable store sales increasing by 2.5%, net sales in the brand portfolio grew slightly by 0.7%. Direct-to-consumer sales accounted for approximately 72% of total sales.

In the third quarter of the current fiscal year, the company’s gross profit decreased to 327.0 million US dollars from 340.4 million US dollars in the same period of the previous year, with the gross margin decreasing by 55 basis points versus last year to 44.1%.

Caleres reported third quarter net earnings of 41.4 million US dollars, or earnings per diluted share of 1.19 US dollars, as compared to 46.9 million US dollars, or earnings per diluted share of 1.32 US dollars, in the third quarter of 2023.

Third quarter adjusted net earnings totalled 42.6 million US dollars, or adjusted earnings per diluted share of 1.23 US dollars, excluding 0.04 US dollars related to charges associated with restructuring initiatives, on a comparable basis to 48.6 million US dollars, or adjusted earnings per diluted share of 1.37 US dollars, in the same prior year period.

Fiscal 2024 Outlook

For the full year, Caleres now expects net sales to decline between 2.5% and 3.0%, as compared to the previous guidance of a low single-digit decline. Full year adjusted earnings per share are now anticipated to range from 3.45 US dollars to 3.55 US dollars, compared to the previous guidance of 4.00 US dollars to 4.15 US dollars.