Attached files
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| 8-K - FORM 8-K - CALERES INC | bws8k052913.htm |
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News
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| Contacts: | |
| Investors | |
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Peggy Reilly Tharp, Brown Shoe Company
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(314) 854-4134, ptharp@brownshoe.com
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Media
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Kelly Malone, Brown Shoe Company
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| 314) 854-4093, kmalone@brownshoe.com |
Brown Shoe Company Reports First Quarter 2013 Results
Consolidated gross margin improves 160 basis points, driven by both wholesale and retail
Famous Footwear reports record first quarter operating profit
ST. LOUIS, May 29, 2013 – Brown Shoe Company, Inc. (NYSE: BWS, brownshoe.com) today reported first quarter 2013 financial results, with net sales of $588.7 million versus first quarter 2012 net sales of $598.2 million, reflecting an adjustment for discontinued operations. However, results for the first quarter of 2013 and 2012 also included sales of $0.2 million and $10.2 million, respectively, from brands and businesses the company has exited. Excluding exited brands, year-over-year net sales were up slightly in the quarter.
On a GAAP basis, the company reported a net loss of ($10.8) million, or ($0.26) per diluted share, in the first quarter of 2013 versus earnings of $1.7 million, or $0.04 per diluted share, in the prior year. First quarter 2013 results included $28.8 million of costs associated with our ongoing portfolio realignment efforts, while earnings for the first quarter of 2012 included $12.8 million of portfolio realignment and ASG integration costs.
On an adjusted(1) basis, net earnings of $13.8 million, or $0.32 per diluted share, improved 37.7% compared to $10.0 million, or $0.23 per diluted share, in the prior year. Gross profit margin for the first quarter of 2013 improved to 40.8% from 39.2% in 2012.
“In addition to stronger-than-expected adjusted EPS of $0.32, we reported record first quarter operating profit of $29 million at Famous Footwear, as we saw improved consumer conversion related to our strategic real estate, inventory and omni-channel efforts,” said Diane Sullivan, president and chief executive officer of Brown Shoe Company. “At wholesale, we refined our portfolio, with the recent sale of Avia and Nevados, and we intend to use the related proceeds in our 2013 debt reduction efforts. In the first quarter, prior to the divestiture, we reduced our short-term borrowings by $39 million.”
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US$M, except per share (unaudited)
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13 Weeks
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1Q
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1Q’13
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1Q’12
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Change
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Consolidated net sales
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$588.7
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$598.2
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(1.6%)
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Famous Footwear
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352.3
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347.1
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1.5%
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Wholesale Operations
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181.6
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194.9
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(6.8%)
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Specialty Retail
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54.8
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56.1
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(2.5%)
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Gross profit
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240.0
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234.3
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2.5%
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Margin
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40.8%
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39.2%
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160 bps
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SG&A
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213.8
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211.5
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1.1%
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% of net sales
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36.3%
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35.4%
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90 bps
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Restructuring and other special charges, net
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5.2
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10.2
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(49.2%)
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Operating earnings
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21.0
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12.6
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66.5%
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% of net sales
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3.6%
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2.1%
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150 bps
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Net interest expense
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5.7
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6.0
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(5.0%)
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Earnings from continuing operations before income taxes
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15.3
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6.6
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130.6%
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Tax rate
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51.9%
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39.4%
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1250 bps
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Net (loss) from discontinued operations
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(18.2)
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(2.4)
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659.9%
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Net (loss) earnings
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($10.8)
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$1.7
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(734.9%)
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Per diluted share
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($0.26)
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$0.04
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(750.0%)
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Adjusted net earnings
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$13.8
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$10.0
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37.7%
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Per diluted share
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$0.32
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$0.23
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39.1%
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First Quarter Highlights
Famous Footwear first quarter 2013 sales of $352.3 million were up 1.5% year-over-year, with good growth in athletic and canvas shoe styles as the quarter progressed. Same-store-sales(2) were up 1.1% over the prior year, as strong same-store-sales of 14.2% in April helped offset weather related weakness in February and March. During the quarter, the company closed or relocated 13 stores and added 12 new stores, as average revenue per square foot continued to improve.
Wholesale sales were down 2.9% in the first quarter, excluding discontinued and exited brands. The company’s Contemporary Fashion wholesale sales were down 2.5% in the first quarter, while Healthy Living wholesale sales were down 3.1%, both excluding exited brands. Wholesale gross margin of 31.8% expanded by 310 basis points during the quarter. Both the Contemporary Fashion and Healthy Living platforms contributed to the improvement, due to a more profitable brand mix, higher initial margins and lower inventory markdown requirements.
Consolidated gross profit of $240.0 million was up 2.5% in the first quarter, while gross margin of 40.8% improved by approximately 160 basis points versus the prior year. SG&A for the first quarter was $213.8 million, or 36.3% of net sales, up approximately 90 basis points from 35.4% of net sales in the prior year. For the quarter, operating margins improved 150 basis points to 3.6%.
Inventory at the end of the first quarter was $485.9 million, up 2.2% compared to $475.6 million in the prior year. Wholesale inventory was up 2.4%, while Famous Footwear inventory was up 1.3%.
At quarter-end, Brown Shoe Company had $413.8 million in availability under its revolving credit facility and $44.7 million in cash and cash equivalents. The company’s debt-to-capital ratio improved to 39.1% from 43.9% in the first quarter of 2012.
Financial Review and 2013 Outlook
“Despite uncooperative weather in February and March, we were able to deliver better than expected results for the quarter,” said Russ Hammer, chief financial officer of Brown Shoe Company. “To reflect our strong performance in the first quarter, we are raising our full-year adjusted EPS guidance to $1.22 to $1.29. However, due to the timing of back-to-school, our biggest sales quarter remains the third quarter.”
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Metric
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FY’13
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Consolidated net sales
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$2.54 to $2.57 billion
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Famous Footwear same-store sales
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Up low-single digits
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Wholesale Operations net sales
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Up low-single digits, excluding brand exits
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Gross profit margin
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Up 30 to 50 basis points
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SG&A
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$900 to $910 million
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Non-recurring costs
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$32 to $34 million
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Net interest expense
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$21 to $22 million
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Effective tax rate, on adjusted basis
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32% to 33%
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Earnings per diluted share
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$0.63 to $0.70
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Adjusted earnings per diluted share
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$1.22 to $1.29
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Depreciation and amortization
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$54 to $56 million
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Capital expenditures
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$50 to $55 million
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Investor Conference Call
Brown Shoe Company will webcast an investor conference call at 9:00 a.m. ET today, May 29, 2013. The webcast and slides will be available at investor.brownshoe.com/news/events. A live conference call will be available at (877) 217-9089 for analysts in North America or (706) 679-1723 for international analysts by using the conference ID 70291031.
A replay will be available at investor.brownshoe.com/news/events/archive for a limited period. Investors may also access the replay by dialing (855) 859-2056 in North America or (404) 537-3406 internationally and using the conference ID 70291031 through June 12, 2013.
(1) 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 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. Reconciliations to the applicable GAAP financial measures have been included in the attached schedules.
(2) Same-Stores-Sales
For comparability purposes, same-store-sales for the first quarter of 2013 is calculated based on retail sales for weeks 1 through 13 in 2013 as compared to weeks 2 through 14 in 2012. This adjustment is due to the impact of the 53rd week of sales in the fourth quarter of fiscal 2012. The calculation for the first quarter of 2013 appropriately reflects the change in same-store-sales on a true retail calendar basis.
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 Brown Shoe Company, Inc. and diluted earnings per common share attributable to Brown Shoe Company, Inc. shareholders, are presented as net earnings and earnings per diluted share, respectively.
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) changing consumer demands, which may be influenced by consumers' disposable income, which in turn can be influenced by general economic conditions; (ii) intense competition within the footwear industry; (iii) rapidly changing fashion trends and purchasing patterns; (iv) customer concentration and increased consolidation in the retail industry; (v) political and economic conditions or other threats to the continued and uninterrupted flow of inventory from China, where Brown Shoe Company relies heavily on manufacturing facilities for a significant amount of their inventory; (vi) the ability to recruit and retain senior management and other key associates; (vii) the ability to attract, retain and maintain good relationships with licensors and protect intellectual property rights; (viii) the ability to secure/exit leases on favorable terms; (ix) the ability to maintain relationships with current suppliers; (x) compliance with applicable laws and standards with respect to lead content in paint and other product safety issues; (xi) the ability to source product at a pace consistent with increased demand for footwear; and (xii) the impact of rising prices in a potentially inflationary global environment. 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 Feb. 2, 2013, 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.
# # #
About Brown Shoe Company
Brown Shoe Company is a $2.6 billion, global footwear company whose shoes are worn by people of all ages, from all walks of life. Our products are available virtually everywhere — in the nearly 1,300 Famous Footwear and Naturalizer retail stores we operate, in hundreds of major department and specialty stores, on 14 branded ecommerce sites, and on many additional third-party retail websites. Through our broad range of products, we serve three key market segments. Our Family brands — Famous Footwear, Famous.com, and shoes.com — are one-stop-shopping destinations for high quality, affordable styles for a family’s every occasion. Active people who want comfort, style and performance can look to our Healthy Living brands — Naturalizer, Dr. Scholl's Shoes, LifeStride and Ryka. Our Contemporary Fashion brands — Via Spiga, Vince, Sam Edelman, Franco Sarto, Carlos Santana and Fergie Footwear — keep fashionistas in step with the latest trends. At Brown Shoe Company, we inspire people to feel good and live better ... feet first!
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SCHEDULE 1
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BROWN SHOE COMPANY, INC.
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CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
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||||||||
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(Unaudited)
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||||||||
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13 Weeks Ended
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(Thousands, except per share data)
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May 4,
2013
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April 28,
2012
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||||||
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Net sales
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$ | 588,656 | $ | 598,179 | ||||
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Cost of goods sold
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348,640 | 363,925 | ||||||
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Gross profit
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240,016 | 234,254 | ||||||
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Selling and administrative expenses
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213,879 | 211,475 | ||||||
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Restructuring and other special charges, net
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5,179 | 10,188 | ||||||
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Operating earnings
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20,958 | 12,591 | ||||||
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Interest expense
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(5,721 | ) | (6,036 | ) | ||||
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Interest income
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68 | 83 | ||||||
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Earnings before income taxes from continuing operations
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15,305 | 6,638 | ||||||
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Income tax provision
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(7,946 | ) | (2,616 | ) | ||||
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Net earnings from continuing operations
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7,359 | 4,022 | ||||||
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Discontinued operations:
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Loss from discontinued operations, net of tax of $3,583 in 2013 and $1,623 in 2012
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(5,637 | ) | (2,394 | ) | ||||
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Impairment charge on net assets of discontinued operations, net of tax of $0
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(12,554 | ) | - | |||||
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Net loss from discontinued operations
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(18,191 | ) | (2,394 | ) | ||||
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Net (loss) earnings
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(10,832 | ) | 1,628 | |||||
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Net loss attributable to noncontrolling interests
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(70 | ) | (67 | ) | ||||
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Net (loss) earnings attributable to Brown Shoe Company, Inc.
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$ | (10,762 | ) | $ | 1,695 | |||
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Basic earnings (loss) per common share:
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||||||||
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From continuing operations
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$ | 0.18 | $ | 0.10 | ||||
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From discontinued operations
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(0.44 | ) | (0.06 | ) | ||||
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Basic (loss) earnings per common share attributable to
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||||||||
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Brown Shoe Company, Inc. shareholders
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$ | (0.26 | ) | $ | 0.04 | |||
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Diluted earnings (loss) per common share:
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||||||||
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From continuing operations
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$ | 0.18 | $ | 0.10 | ||||
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From discontinued operations
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(0.44 | ) | (0.06 | ) | ||||
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Diluted (loss) earnings per common share attributable to
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||||||||
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Brown Shoe Company, Inc. shareholders
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$ | (0.26 | ) | $ | 0.04 | |||
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Basic number of shares
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41,070 | 40,422 | ||||||
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Diluted number of shares
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41,268 | 40,744 | ||||||
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SCHEDULE 2
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BROWN SHOE COMPANY, INC.
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CONDENSED CONSOLIDATED BALANCE SHEETS
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(Unaudited)
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(Thousands)
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May 4,
2013
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April 28,
2012
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February 2,
2013
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ASSETS
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Cash and cash equivalents
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$ | 44,669 | $ | 39,792 | $ | 68,223 | ||||||
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Receivables, net
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96,734 | 115,911 | 111,392 | |||||||||
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Inventories, net
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485,923 | 475,557 | 503,688 | |||||||||
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Prepaid expenses and other current assets
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43,167 | 41,375 | 42,016 | |||||||||
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Current assets - held for sale
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12,496 | - | - | |||||||||
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Current assets - discontinued operations
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39,159 | 65,515 | 47,109 | |||||||||
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Total current assets
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722,148 | 738,150 | 772,428 | |||||||||
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Property and equipment, net
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137,299 | 124,551 | 144,856 | |||||||||
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Goodwill and intangible assets, net
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68,442 | 81,975 | 82,504 | |||||||||
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Other assets
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115,591 | 137,479 | 119,695 | |||||||||
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Non current assets - discontinued operations
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51,227 | 58,667 | 51,776 | |||||||||
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Total assets
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$ | 1,094,707 | $ | 1,140,822 | $ | 1,171,259 | ||||||
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LIABILITIES AND EQUITY
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Borrowings under revolving credit agreement
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$ | 66,000 | $ | 124,000 | $ | 105,000 | ||||||
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Trade accounts payable
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188,948 | 172,894 | 213,660 | |||||||||
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Other accrued expenses
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118,632 | 129,852 | 137,190 | |||||||||
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Current liabilities - held for sale
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5,306 | – | – | |||||||||
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Current liabilities - discontinued operations
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16,183 | 15,118 | 13,259 | |||||||||
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Total current liabilities
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395,069 | 441,864 | 469,109 | |||||||||
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Long-term debt
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198,870 | 198,680 | 198,823 | |||||||||
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Deferred rent
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35,631 | 29,746 | 33,711 | |||||||||
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Other liabilities
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45,435 | 47,569 | 36,719 | |||||||||
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Non current liabilities - discontinued operations
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6,768 | 9,969 | 6,996 | |||||||||
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Total other liabilities
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286,704 | 285,964 | 276,249 | |||||||||
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Total Brown Shoe Company, Inc. shareholders’ equity
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412,190 | 412,012 | 425,129 | |||||||||
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Noncontrolling interests
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744 | 982 | 772 | |||||||||
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Total equity
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412,934 | 412,994 | 425,901 | |||||||||
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Total liabilities and equity
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$ | 1,094,707 | $ | 1,140,822 | $ | 1,171,259 | ||||||
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SCHEDULE 3
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BROWN SHOE COMPANY, INC.
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
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13 Weeks Ended
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||||||||
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(Thousands)
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May 4,
2013
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April 28,
2012
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||||||
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OPERATING ACTIVITIES:
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||||||||
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Net (loss) earnings
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$ | (10,832 | ) | $ | 1,628 | |||
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Adjustments to reconcile net (loss) earnings to net cash provided by operating activities:
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||||||||
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Depreciation and amortization
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13,805 | 13,280 | ||||||
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Amortization of debt issuance costs
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629 | 629 | ||||||
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Share-based compensation expense
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1,617 | 1,444 | ||||||
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Tax benefit related to share-based plans
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(1,962 | ) | (753 | ) | ||||
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Loss on disposal of facilities and equipment
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68 | 456 | ||||||
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Impairment charges for facilities and equipment
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5,026 | 2,756 | ||||||
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Impairment of net assets of discontinued operations
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12,554 | - | ||||||
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Deferred rent
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1,920 | (2,615 | ) | |||||
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Provision for doubtful accounts
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307 | 950 | ||||||
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Changes in operating assets and liabilities:
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||||||||
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Receivables
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16,363 | 13,587 | ||||||
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Inventories
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17,223 | 49,251 | ||||||
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Prepaid expenses and other current and noncurrent assets
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653 | 6,377 | ||||||
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Trade accounts payable
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(26,561 | ) | (8,268 | ) | ||||
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Accrued expenses and other liabilities
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(1,565 | ) | 1,900 | |||||
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Other, net
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(3,284 | ) | (724 | ) | ||||
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Net cash provided by operating activities
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25,961 | 79,898 | ||||||
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INVESTING ACTIVITIES:
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||||||||
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Capital expenditures
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(8,407 | ) | (7,008 | ) | ||||
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Proceeds from sale of assets
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1,500 | - | ||||||
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Net cash used for investing activities
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(6,907 | ) | (7,008 | ) | ||||
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FINANCING ACTIVITIES:
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||||||||
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Borrowings under revolving credit agreement
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383,000 | 165,000 | ||||||
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Repayments under revolving credit agreement
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(422,000 | ) | (242,000 | ) | ||||
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Dividends paid
|
(3,027 | ) | (2,999 | ) | ||||
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Issuance of common stock under share-based plans, net
|
(2,070 | ) | (2,148 | ) | ||||
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Tax benefit related to share-based plans
|
1,962 | 753 | ||||||
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Net cash used for financing activities
|
(42,135 | ) | (81,394 | ) | ||||
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Effect of exchange rate changes on cash and cash equivalents
|
(473 | ) | 614 | |||||
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Decrease in cash and cash equivalents
|
(23,554 | ) | (7,890 | ) | ||||
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Cash and cash equivalents at beginning of period
|
68,223 | 47,682 | ||||||
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Cash and cash equivalents at end of period
|
$ | 44,669 | $ | 39,792 | ||||
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RECONCILIATION OF NET (LOSS) EARNINGS AND DILUTED (LOSS) EARNINGS PER SHARE (GAAP BASIS) TO ADJUSTED NET EARNINGS AND ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP BASIS)
|
||||||||||||||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||||||||||
|
13 Weeks Ended May 4, 2013
|
13 Weeks Ended April 28, 2012
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|||||||||||||||||||||||
|
(Thousands, except per share data)
|
Pre-Tax
Impact of
Charges/
Other Items
|
Net (Loss)
Earnings
Attributable to
Brown Shoe
Company, Inc.
|
Diluted (Loss)
Earnings Per
Share
|
Pre-Tax Impact
of Charges/
Other Items
|
Net Earnings
Attributable to
Brown Shoe
Company, Inc.
|
Diluted
Earnings Per
Share
|
||||||||||||||||||
|
GAAP (loss) earnings
|
$ | (10,762 | ) | $ | (0.26 | ) | $ | 1,695 | $ | 0.04 | ||||||||||||||
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Charges/Other Items:
|
||||||||||||||||||||||||
|
Portfolio realignment
|
||||||||||||||||||||||||
|
Non-cash impairment charges
|
$ | 17,214 | 17,214 | 0.41 | $ | – | – | – | ||||||||||||||||
|
Business exits and cost reductions
|
11,627 | 7,347 | 0.17 | 12,091 | 7,883 | 0.18 | ||||||||||||||||||
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ASG integration-related costs
|
– | – | – | 675 | 441 | 0.01 | ||||||||||||||||||
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Total charges/other items
|
$ | 28,841 | 24,561 | 0.58 | $ | 12,766 | 8,324 | 0.19 | ||||||||||||||||
|
Adjusted earnings
|
$ | 13,799 | $ | 0.32 | $ | 10,019 | $ | 0.23 | ||||||||||||||||
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SCHEDULE 5
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BROWN SHOE COMPANY, INC.
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SUMMARY FINANCIAL RESULTS BY SEGMENT
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(Unaudited)
|
||||||||||||||||||||||||||||||||||||||||
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SUMMARY FINANCIAL RESULTS
|
||||||||||||||||||||||||||||||||||||||||
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Famous Footwear
|
Wholesale Operations
|
Specialty Retail
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Other
|
Consolidated
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||||||||||||||||||||||||||||||||||||
|
13 Weeks Ended
|
13 Weeks Ended
|
13 Weeks Ended
|
13 Weeks Ended
|
13 Weeks Ended
|
||||||||||||||||||||||||||||||||||||
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May 4,
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April 28,
|
May 4,
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April 28,
|
May 4,
|
April 28,
|
May 4,
|
April 28,
|
May 4,
|
April 28,
|
|||||||||||||||||||||||||||||||
|
(Thousands)
|
2013
|
2012
|
2013
|
2012
|
2013
|
2012
|
2013
|
2012
|
2013
|
2012
|
||||||||||||||||||||||||||||||
|
Net Sales
|
$ | 352,279 | $ | 347,107 | $ | 181,625 | $ | 194,941 | $ | 54,752 | $ | 56,131 | $ | – | $ | – | $ | 588,656 | $ | 598,179 | ||||||||||||||||||||
|
Gross Profit
|
$ | 158,661 | $ | 155,140 | $ | 57,819 | $ | 55,945 | $ | 23,536 | $ | 23,169 | $ | – | $ | – | $ | 240,016 | $ | 234,254 | ||||||||||||||||||||
|
Adjusted Gross Profit
|
$ | 158,661 | $ | 155,140 | $ | 57,819 | $ | 57,035 | $ | 23,536 | $ | 23,390 | $ | – | $ | – | $ | 240,016 | $ | 235,565 | ||||||||||||||||||||
|
Gross Profit Rate
|
45.0 | % | 44.7% | 31.8% | 28.7% | 43.0% | 41.3% | – | – | 40.8% | 39.2% | |||||||||||||||||||||||||||||
|
Adjusted Gross Profit Rate
|
45.0 | % | 44.7% | 31.8% | 29.3% | 43.0% | 41.7% | – | – | 40.8% | 39.4% | |||||||||||||||||||||||||||||
|
Operating Earnings (Loss)
|
$ | 29,042 | $ | 18,301 | $ | 3,107 | $ | 5,875 | $ | (1,329 | ) | $ | (3,527 | ) | $ | (9,862 | ) | $ | (8,058 | ) | $ | 20,958 | $ | 12,591 | ||||||||||||||||
|
Adjusted Operating Earnings (Loss)
|
$ | 29,042 | $ | 25,326 | $ | 8,270 | $ | 8,904 | $ | (1,329 | ) | $ | (2,538 | ) | $ | (9,846 | ) | $ | (7,602 | ) | $ | 26,137 | $ | 24,090 | ||||||||||||||||
|
Operating Earnings (Loss) %
|
8.2 | % | 5.3% | 1.7% | 3.0% | (2.4%) | (6.3%) | – | – | 3.6% | 2.1% | |||||||||||||||||||||||||||||
|
Adjusted Operating Earnings (Loss) %
|
8.2 | % | 7.3% | 4.6% | 4.6% | (2.4%) | (4.5%) | – | – | 4.4% | 4.0% | |||||||||||||||||||||||||||||
|
Same-store Sales % (on a 13-week basis)
|
1.1 | % | 2.5% | – | – | (0.3%) | 2.6% | – | – | – | – | |||||||||||||||||||||||||||||
|
Number of Stores
|
1,054 | 1,066 | – | – | 215 | 227 | – | – | 1,269 | 1,293 | ||||||||||||||||||||||||||||||
|
RECONCILIATION OF ADJUSTED RESULTS (NON-GAAP)
|
||||||||||||||||||||||||||||||||||||||||
|
Famous Footwear
|
Wholesale Operations
|
Specialty Retail
|
Other
|
Consolidated
|
||||||||||||||||||||||||||||||||||||
|
13 Weeks Ended
|
13 Weeks Ended
|
13 Weeks Ended
|
13 Weeks Ended
|
13 Weeks Ended
|
||||||||||||||||||||||||||||||||||||
|
May 4,
|
April 28,
|
May 4,
|
April 28,
|
May 4,
|
April 28,
|
May 4,
|
April 28,
|
May 4,
|
April 28,
|
|||||||||||||||||||||||||||||||
|
(Thousands)
|
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||||||||||
|
Gross Profit
|
$ | 158,661 | $ | 155,140 | $ | 57,819 | $ | 55,945 | $ | 23,536 | $ | 23,169 | $ | – | $ | – | $ | 240,016 | $ | 234,254 | ||||||||||||||||||||
|
Charges/Other Items:
|
||||||||||||||||||||||||||||||||||||||||
|
Portfolio realignment
|
||||||||||||||||||||||||||||||||||||||||
|
Business exits and cost reductions
|
– | – | – | 1,090 | – | 221 | – | – | – | 1,311 | ||||||||||||||||||||||||||||||
|
Total charges/other items
|
– | – | – | 1,090 | – | 221 | – | – | – | 1,311 | ||||||||||||||||||||||||||||||
|
Adjusted Gross Profit
|
$ | 158,661 | $ | 155,140 | $ | 57,819 | $ | 57,035 | $ | 23,536 | $ | 23,390 | $ | – | $ | – | $ | 240,016 | $ | 235,565 | ||||||||||||||||||||
|
Operating Earnings (Loss)
|
$ | 29,042 | $ | 18,301 | $ | 3,107 | $ | 5,875 | $ | (1,329 | ) | $ | (3,527 | ) | $ | (9,862 | ) | $ | (8,058 | ) | $ | 20,958 | $ | 12,591 | ||||||||||||||||
|
Charges/Other Items:
|
||||||||||||||||||||||||||||||||||||||||
|
Portfolio realignment
|
||||||||||||||||||||||||||||||||||||||||
|
Non-cash impairment charges
|
– | – | 4,660 | – | – | – | – | – | 4,660 | – | ||||||||||||||||||||||||||||||
|
Business exits and cost reductions
|
– | 7,025 | 503 | 3,029 | – | 989 | 16 | 456 | 519 | 11,499 | ||||||||||||||||||||||||||||||
|
Total charges/other items
|
– | 7,025 | 5,163 | 3,029 | – | 989 | 16 | 456 | 5,179 | 11,499 | ||||||||||||||||||||||||||||||
|
Adjusted Operating Earnings (Loss)
|
$ | 29,042 | $ | 25,326 | $ | 8,270 | $ | 8,904 | $ | (1,329 | ) | $ | (2,538 | ) | $ | (9,846 | ) | $ | (7,602 | ) | $ | 26,137 | $ | 24,090 | ||||||||||||||||
|
Note: April 28, 2012 information has been updated for the impact of discontinued operations.
|
||||||||||||||||||
|
SCHEDULE 6
|
||||||||
|
BROWN SHOE COMPANY, INC.
|
||||||||
|
BASIC AND DILUTED EARNINGS PER SHARE RECONCILIATION
|
||||||||
|
(Unaudited)
|
||||||||
|
13 Weeks Ended
|
||||||||
|
May 4,
|
April 28,
|
|||||||
|
(Thousands, except per share data)
|
2013
|
2012
|
||||||
|
Net earnings attributable to Brown Shoe Company, Inc.:
|
||||||||
|
Net earnings from continuing operations
|
$ | 7,359 | $ | 4,022 | ||||
|
Net loss attributable to noncontrolling interests
|
70 | 67 | ||||||
|
Net earnings allocated to participating securities
|
– | (155 | ) | |||||
|
Net earnings from continuing operations
|
7,429 | 3,934 | ||||||
|
Net loss from discontinued operations
|
(18,191 | ) | (2,394 | ) | ||||
|
Net earnings allocated to participating securities
|
– | – | ||||||
|
Net loss from discontinued operations
|
(18,191 | ) | (2,394 | ) | ||||
|
Net (loss) earnings attributable to Brown Shoe Company, Inc. after allocation of earnings to participating securities
|
$ | (10,762 | ) | $ | 1,540 | |||
|
Basic and diluted common shares attributable to Brown Shoe Company, Inc.:
|
||||||||
|
Basic common shares for continuing operations and discontinued operations
|
41,070 | 40,422 | ||||||
|
Dilutive effect of share-based awards for continuing operations and discontinued operations
|
198 | 322 | ||||||
|
Diluted common shares for continuing operations and discontinued operations attributable to Brown Shoe Company, Inc.
|
41,268 | 40,744 | ||||||
|
Basic earnings (loss) per share:
|
||||||||
|
From continuing operations
|
$ | 0.18 | $ | 0.10 | ||||
|
From discontinued operations
|
(0.44 | ) | (0.06 | ) | ||||
|
Basic (loss) earnings per common share attributable to Brown Shoe Company, Inc. shareholders
|
$ | (0.26 | ) | $ | 0.04 | |||
|
Diluted earnings (loss) per share:
|
||||||||
|
From continuing operations
|
$ | 0.18 | $ | 0.10 | ||||
|
From discontinued operations
|
(0.44 | ) | (0.06 | ) | ||||
|
Diluted (loss) earnings per common share attributable to Brown Shoe Company, Inc. shareholders
|
$ | (0.26 | ) | $ | 0.04 | |||
|
SCHEDULE 7
|
||||||||
|
BROWN SHOE COMPANY, INC.
|
||||||||
|
BASIC AND DILUTED ADJUSTED EARNINGS PER SHARE RECONCILIATION
|
||||||||
|
(Unaudited)
|
||||||||
|
13 Weeks Ended
|
||||||||
|
May 4,
|
April 28,
|
|||||||
|
(Thousands, except per share data)
|
2013
|
2012
|
||||||
|
Adjusted net earnings attributable to Brown Shoe Company, Inc.:
|
||||||||
|
Adjusted net earnings from continuing operations
|
$ | 12,336 | $ | 11,520 | ||||
|
Net loss attributable to noncontrolling interests
|
70 | 67 | ||||||
|
Net earnings allocated to participating securities
|
(591 | ) | (489 | ) | ||||
|
Adjusted net earnings from continuing operations
|
11,815 | 11,098 | ||||||
|
Adjusted net earnings (loss) from discontinued operations
|
1,393 | (1,568 | ) | |||||
|
Net earnings allocated to participating securities
|
(67 | ) | – | |||||
|
Net earnings (loss) from discontinued operations
|
1,326 | (1,568 | ) | |||||
|
Adjusted net earnings attributable to Brown Shoe Company, Inc. after allocation of earnings to participating securities
|
$ | 13,141 | $ | 9,530 | ||||
|
Basic and diluted common shares attributable to Brown Shoe Company, Inc.:
|
||||||||
|
Basic common shares for continuing operations and discontinued operations
|
41,070 | 40,422 | ||||||
|
Dilutive effect of share-based awards for continuing operations and discontinued operations
|
198 | 322 | ||||||
|
Diluted common shares for continuing operations and discontinued operations attributable to Brown Shoe Company, Inc.
|
41,268 | 40,744 | ||||||
|
Basic adjusted earnings (loss) per share:
|
||||||||
|
From continuing operations
|
$ | 0.29 | $ | 0.28 | ||||
|
From discontinued operations
|
0.03 | (0.04 | ) | |||||
|
Basic adjusted earnings per common share attributable to Brown Shoe Company, Inc. shareholders
|
$ | 0.32 | $ | 0.24 | ||||
|
Diluted adjusted earnings (loss) per share:
|
||||||||
|
From continuing operations
|
$ | 0.29 | $ | 0.27 | ||||
|
From discontinued operations
|
0.03 | (0.04 | ) | |||||
|
Diluted adjusted earnings per common share attributable to Brown Shoe Company, Inc. shareholders
|
$ | 0.32 | $ | 0.23 | ||||
|
SCHEDULE 8
|
||||||||||||
|
BROWN SHOE COMPANY, INC.
|
||||||||||||
|
ADJUSTMENTS TO FIRST QUARTER 2012 RESULTS FOR DISCONTINUED OPERATIONS
|
||||||||||||
|
13 Weeks Ended
|
||||||||||||
|
(Thousands)
|
Previously
Reported
April 28, 2012
|
Adjustments for Discontinued
Operations
|
April 28, 2012
|
|||||||||
|
Net sales
|
$ | 626,441 | $ | (28,262 | ) | $ | 598,179 | |||||
|
Cost of goods sold
|
387,377 | (23,452 | ) | 363,925 | ||||||||
|
Gross profit
|
239,064 | (4,810 | ) | 234,254 | ||||||||
|
Selling and administrative expenses
|
218,914 | (7,439 | ) | 211,475 | ||||||||
|
Restructuring and other special charges, net
|
11,455 | (1,267 | ) | 10,188 | ||||||||
|
Operating earnings
|
8,695 | 3,896 | 12,591 | |||||||||
|
Interest expense
|
(6,157 | ) | 121 | (6,036 | ) | |||||||
|
Interest income
|
83 | – | 83 | |||||||||
|
Earnings before income taxes from continuing operations
|
2,621 | 4,017 | 6,638 | |||||||||
|
Income tax provision
|
(993 | ) | (1,623 | ) | (2,616 | ) | ||||||
|
Net earnings from continuing operations
|
1,628 | 2,394 | 4,022 | |||||||||
|
Net loss from discontinued operations
|
– | (2,394 | ) | (2,394 | ) | |||||||
|
Net earnings
|
1,628 | – | 1,628 | |||||||||
|
Net loss attributable to noncontrolling interests
|
(67 | ) | – | (67 | ) | |||||||
|
Net earnings attributable to Brown Shoe Company, Inc.
|
$ | 1,695 | $ | – | $ | 1,695 | ||||||
|
Note: Beginning with the first quarter of 2013, the operations of our Avia, Nevados, Vera Wang and Etienne Aigner brands qualify as discontinued operations. We have provided this reconciliation to illustrate the impact of the reclassifications for discontinued operations.
|
||||||||||||
|
SCHEDULE 8 - CONTINUED
|
||||||||||||
|
BROWN SHOE COMPANY, INC.
|
||||||||||||
|
ADJUSTMENTS TO SECOND QUARTER 2012 RESULTS FOR DISCONTINUED OPERATIONS
|
||||||||||||
|
13 Weeks Ended
|
||||||||||||
|
(Thousands)
|
Previously
Reported
July 28, 2012
|
Adjustments for
Discontinued
Operations
|
July 28, 2012
|
|||||||||
|
Net sales
|
$ | 599,279 | $ | (34,382 | ) | $ | 564,897 | |||||
|
Cost of goods sold
|
365,465 | (28,222 | ) | 337,243 | ||||||||
|
Gross profit
|
233,814 | (6,160 | ) | 227,654 | ||||||||
|
Selling and administrative expenses
|
219,261 | (7,555 | ) | 211,706 | ||||||||
|
Restructuring and other special charges, net
|
7,491 | (165 | ) | 7,326 | ||||||||
|
Impairment of intangible assets
|
5,777 | (5,777 | ) | – | ||||||||
|
Operating earnings
|
1,285 | 7,337 | 8,622 | |||||||||
| - | ||||||||||||
|
Interest expense
|
(5,758 | ) | 113 | (5,645 | ) | |||||||
|
Interest income
|
77 | – | 77 | |||||||||
|
(Loss) earnings before income taxes from continuing operations
|
(4,396 | ) | 7,450 | 3,054 | ||||||||
|
Income tax benefit (provision)
|
1,682 | (2,923 | ) | (1,241 | ) | |||||||
|
Net (loss) earnings from continuing operations
|
(2,714 | ) | 4,527 | 1,813 | ||||||||
|
Net loss from discontinued operations
|
– | (4,527 | ) | (4,527 | ) | |||||||
|
Net loss
|
(2,714 | ) | – | (2,714 | ) | |||||||
|
Net loss attributable to noncontrolling interests
|
(179 | ) | – | (179 | ) | |||||||
|
Net loss attributable to Brown Shoe Company, Inc.
|
$ | (2,535 | ) | $ | – | $ | (2,535 | ) | ||||
|
Note: Beginning with the first quarter of 2013, the operations of our Avia, Nevados, Vera Wang and Etienne Aigner brands qualify as discontinued operations. We have provided this reconciliation to illustrate the impact of the reclassifications for discontinued operations.
|
||||||||||||
|
SCHEDULE 8 - CONTINUED
|
||||||||||||
|
BROWN SHOE COMPANY, INC.
|
||||||||||||
|
ADJUSTMENTS TO THIRD QUARTER 2012 RESULTS FOR DISCONTINUED OPERATIONS
|
||||||||||||
|
13 Weeks Ended
|
||||||||||||
|
(Thousands)
|
Previously
Reported
October 27, 2012
|
Adjustments for
Discontinued
Operations
|
October 27, 2012
|
|||||||||
|
Net sales
|
$ | 732,169 | $ | (36,184 | ) | $ | 695,985 | |||||
|
Cost of goods sold
|
446,387 | (29,737 | ) | 416,650 | ||||||||
|
Gross profit
|
285,782 | (6,447 | ) | 279,335 | ||||||||
|
Selling and administrative expenses
|
242,317 | (6,121 | ) | 236,196 | ||||||||
|
Restructuring and other special charges, net
|
2,342 | (196 | ) | 2,146 | ||||||||
|
Operating earnings
|
41,123 | (130 | ) | 40,993 | ||||||||
|
Interest expense
|
(5,513 | ) | 115 | (5,398 | ) | |||||||
|
Interest income
|
76 | – | 76 | |||||||||
|
Earnings before income taxes from continuing operations
|
35,686 | (15 | ) | 35,671 | ||||||||
|
Income tax provision
|
(11,399 | ) | (19 | ) | (11,418 | ) | ||||||
|
Net earnings from continuing operations
|
24,287 | (34 | ) | 24,253 | ||||||||
|
Net earnings from discontinued operations
|
– | 34 | 34 | |||||||||
|
Net earnings
|
24,287 | – | 24,287 | |||||||||
|
Net loss attributable to noncontrolling interests
|
(5 | ) | – | (5 | ) | |||||||
|
Net earnings attributable to Brown Shoe Company, Inc.
|
$ | 24,292 | $ | – | $ | 24,292 | ||||||
|
Note: Beginning with the first quarter of 2013, the operations of our Avia, Nevados, Vera Wang and Etienne Aigner brands qualify as discontinued operations. We have provided this reconciliation to illustrate the impact of the reclassifications for discontinued operations.
|
||||||||||||
|
SCHEDULE 8 - CONTINUED
|
||||||||||||
|
BROWN SHOE COMPANY, INC.
|
||||||||||||
|
ADJUSTMENTS TO FOURTH QUARTER 2012 RESULTS FOR DISCONTINUED OPERATIONS
|
||||||||||||
|
14 Weeks Ended
|
||||||||||||
|
(Thousands)
|
Previously
Reported
February 2, 2013
|
Adjustments for
Discontinued
Operations
|
February 2, 2013
|
|||||||||
|
Net sales
|
$ | 640,176 | $ | (21,441 | ) | $ | 618,735 | |||||
|
Cost of goods sold
|
388,477 | (17,074 | ) | 371,403 | ||||||||
|
Gross profit
|
251,699 | (4,367 | ) | 247,332 | ||||||||
|
Selling and administrative expenses
|
238,465 | (6,176 | ) | 232,289 | ||||||||
|
Restructuring and other special charges, net
|
2,730 | 41 | 2,771 | |||||||||
|
Operating earnings
|
10,504 | 1,768 | 12,272 | |||||||||
|
Interest expense
|
(5,954 | ) | 60 | (5,894 | ) | |||||||
|
Interest income
|
86 | – | 86 | |||||||||
|
Earnings before income taxes from continuing operations
|
4,636 | 1,828 | 6,464 | |||||||||
|
Income tax provision
|
(633 | ) | (748 | ) | (1,381 | ) | ||||||
|
Net earnings from continuing operations
|
4,003 | 1,080 | 5,083 | |||||||||
|
Net loss from discontinued operations
|
– | (1,080 | ) | (1,080 | ) | |||||||
|
Net earnings
|
4,003 | – | 4,003 | |||||||||
|
Net loss attributable to noncontrolling interests
|
(36 | ) | – | (36 | ) | |||||||
|
Net earnings attributable to Brown Shoe Company, Inc.
|
$ | 4,039 | $ | – | $ | 4,039 | ||||||
|
Note: Beginning with the first quarter of 2013, the operations of our Avia, Nevados, Vera Wang and Etienne Aigner brands qualify as discontinued operations. We have provided this reconciliation to illustrate the impact of the reclassifications for discontinued operations.
|
||||||||||||