Company Reports Comparable Store Sales Increase for Eighth
Consecutive Quarter
EVANSVILLE, Ind.--(BUSINESS WIRE)--Aug. 31, 2016--
Shoe Carnival, Inc. (Nasdaq: SCVL) a leading retailer of moderately
priced footwear and accessories, today reported results for the second
quarter ended July 30, 2016.
Second Quarter Highlights
-
Net sales increased $4.1 million to $231.9 million compared to $227.8
million in the second quarter of fiscal 2015
-
Comparable store sales increased 0.5 percent in the second quarter of
2016
-
Per-store inventories were down 2.5 percent at the end of the quarter
compared to the second quarter of fiscal 2015
-
Repurchased 966,828 shares of common stock at a total cost of $23.6
million under share repurchase program
“Our non-athletic footwear categories, particularly sandals, performed
well in the second quarter. Shoe Perks, our loyalty program, continued
to be a valuable tool for us as we increased shopping frequency and
average order value across our most loyal customers to report an eighth
consecutive quarterly increase in comparable store sales,” stated Cliff
Sifford, Shoe Carnival’s President and CEO. “We remain focused on the
execution of our multi-channel strategic initiatives to fuel future
growth in sales and profitability. Going forward, we have confidence in
our opportunities and our ability to capitalize on them while
maintaining the financial flexibility to continue our commitment of
returning value to our shareholders through share repurchases and
consistent dividend payments.”
Second Quarter Financial Results
The Company reported net sales of $231.9 million for the second quarter
of fiscal 2016, a 1.8 percent increase compared to net sales of $227.8
million for the second quarter of fiscal 2015. Comparable store sales
increased 0.5 percent in the second quarter of fiscal 2016.
The gross profit margin for the second quarter of fiscal 2016 decreased
to 29.0 percent compared to 29.1 percent in the second quarter of fiscal
2015. The merchandise margin decreased 0.4 percent. Buying, distribution
and occupancy expenses decreased 0.3 percent as a percentage of sales.
Selling, general and administrative expenses for the second quarter of
fiscal 2016 increased $2.2 million to $60.6 million. As a percentage of
sales, these expenses increased to 26.1 percent compared to 25.6 percent
in the second quarter of fiscal 2015.
The Company opened nine new stores in the second quarter of fiscal 2016
compared to five new stores in the second quarter of fiscal 2015.
Net earnings for the second quarter of fiscal 2016 were $4.1 million, or
$0.22 per diluted share. For the second quarter of fiscal 2015, the
Company reported net earnings of $4.8 million, or $0.24 per diluted
share.
Six Month Financial Results
Net sales during the first six months of fiscal 2016 increased $11.8
million to $492.4 million compared to the same period last year.
Comparable store sales for the twenty-six week period ended July 30,
2016, increased 1.6 percent. Net earnings for the first six months of
fiscal 2016 were $14.8 million, or $0.78 per diluted share, compared to
net earnings of $15.2 million, or $0.76 per diluted share, in the first
six months of fiscal 2015. The gross profit margin for the first six
months of fiscal 2016 was 29.0 percent compared to 29.3 percent in the
same period last year. Selling, general and administrative expenses
remained flat as a percentage of sales. The Company opened 12 stores and
closed four stores during the first six months of fiscal 2016 compared
to 12 store openings and 12 store closings in the first six months of
fiscal 2015.
Fiscal 2016 Earnings Outlook
The Company is updating its annual fiscal 2016 sales outlook and is
maintaining its diluted earnings per share outlook due to the positive
benefit from the shares repurchased during the first half of the year.
Fiscal 2016 net sales are now expected to be in the range of $1.012
billion to $1.016 billion, with a comparable store sales increase in the
range of 1.5 percent to 2.0 percent. Earnings per diluted share for the
fiscal year are expected to be in the range of $1.58 to $1.65. This
represents an increase of 9 percent to 14 percent over fiscal 2015
earnings per diluted share of $1.45.
Store Growth
The Company expects to open approximately 20 stores, including seven
small-market stores, and close approximately ten stores in fiscal 2016.
Store openings and closings by quarter for the fiscal year are as
follows:
|
|
|
New Stores
|
|
|
Store Closings
|
1st quarter 2016
|
|
|
3
|
|
|
4
|
2nd quarter 2016
|
|
|
9
|
|
|
0
|
3rd quarter 2016
|
|
|
2
|
|
|
1
|
4th quarter 2016
|
|
|
6
|
|
|
5
|
Fiscal year 2016
|
|
|
20
|
|
|
10
|
|
|
|
|
|
|
|
The nine new stores opened during the second quarter include locations
in:
City
|
|
|
Market
|
|
|
Total Stores in the Market
|
Deptford, NJ
|
|
|
Philadelphia
|
|
|
9
|
Dover, DE
|
|
|
Philadelphia
|
|
|
9
|
Grandview, MO
|
|
|
Kansas City
|
|
|
5
|
Lebanon, IN
|
|
|
Indianapolis
|
|
|
13
|
Mesquite, TX
|
|
|
Dallas
|
|
|
11
|
Omaha, NE
|
|
|
Omaha
|
|
|
3
|
Paris, TN
|
|
|
Nashville
|
|
|
7
|
Richardson, TX
|
|
|
Dallas
|
|
|
11
|
Vestal, NY
|
|
|
Binghamton
|
|
|
1
|
|
|
|
|
|
|
|
Conference Call
Today, at 4:30 p.m. Eastern Time, the Company will host a conference
call to discuss the second quarter results. Participants can listen to
the live webcast of the call by visiting Shoe Carnival's Investors
webpage at www.shoecarnival.com.
While the question-and-answer session will be available to all
listeners, questions from the audience will be limited to institutional
analysts and investors. A replay of the webcast will be available on the
Company’s website beginning approximately two hours after the conclusion
of the conference call and will be archived for one year.
About Shoe Carnival
Shoe Carnival, Inc. is one of the nation’s largest family footwear
retailers, offering a broad assortment of moderately priced dress,
casual and athletic footwear for men, women and children with emphasis
on national and regional name brands. As of August 31, 2016, the Company
operates 412 stores in 35 states and Puerto Rico, and offers online
shopping at www.shoecarnival.com.
Headquartered in Evansville, IN, Shoe Carnival trades on The NASDAQ
Stock Market LLC under the symbol SCVL. Shoe Carnival's press releases
and annual report are available on the Company's website at www.shoecarnival.com.
Cautionary Statement Regarding Forward-Looking Information
This press release contains forward-looking statements, within the
meaning of the Private Securities Litigation Reform Act of 1995, that
involve a number of risks and uncertainties. A number of factors could
cause our actual results, performance, achievements or industry results
to be materially different from any future results, performance or
achievements expressed or implied by these forward-looking statements.
These factors include, but are not limited to: general economic
conditions in the areas of the continental United States in which our
stores are located and the impact of the ongoing economic crisis in
Puerto Rico on sales at, and cash flows of, our stores located in Puerto
Rico; the effects and duration of economic downturns and unemployment
rates; changes in the overall retail environment and more specifically
in the apparel and footwear retail sectors; our ability to generate
increased sales at our stores; the potential impact of national and
international security concerns on the retail environment; changes in
our relationships with key suppliers; the impact of competition and
pricing; our ability to successfully manage and execute our marketing
initiatives and maintain positive brand perception and recognition;
changes in weather patterns, consumer buying trends and our ability to
identify and respond to emerging fashion trends; the impact of
disruptions in our distribution or information technology operations;
the effectiveness of our inventory management; the impact of hurricanes
or other natural disasters on our stores, as well as on consumer
confidence and purchasing in general; risks associated with the
seasonality of the retail industry; the impact of unauthorized
disclosure or misuse of personal and confidential information about our
customers, vendors and employees; our ability to manage our third-party
vendor relationships; our ability to successfully execute our growth
strategy, including the availability of desirable store locations at
acceptable lease terms, our ability to open new stores in a timely and
profitable manner, including our entry into major new markets, and the
availability of sufficient funds to implement our growth plans; higher
than anticipated costs or impairment charges associated with the closing
of underperforming stores; our ability to successfully grow our
e-commerce sales; the inability of manufacturers to deliver products in
a timely manner; changes in the political and economic environments in
China, Brazil, Europe and East Asia, where the primary manufacturers of
footwear are located; the impact of regulatory changes in the United
States and the countries where our manufacturers are located; the
continued favorable trade relations between the United States and China
and the other countries which are the major manufacturers of footwear;
the resolution of litigation or regulatory proceedings in which we are
or may become involved; our ability to meet our labor needs while
controlling costs; and future stock repurchases under our stock
repurchase program and future dividend payments, and other factors
described in the Company’s SEC filings, including the Company’s latest
Annual Report on Form 10-K.
In addition, these forward-looking statements necessarily depend upon
assumptions, estimates and dates that may be incorrect or imprecise and
involve known and unknown risks, uncertainties and other factors.
Accordingly, any forward-looking statements included in this press
release do not purport to be predictions of future events or
circumstances and may not be realized. Forward-looking statements can be
identified by, among other things, the use of forward-looking terms such
as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “pro forma,”
“anticipates,” “intends” or the negative of any of these terms, or
comparable terminology, or by discussions of strategy or intentions.
Given these uncertainties, we caution investors not to place undue
reliance on these forward-looking statements, which speak only as of the
date hereof. We disclaim any obligation to update any of these factors
or to publicly announce any revisions to the forward-looking statements
contained in this press release to reflect future events or developments.
|
|
SHOE CARNIVAL, INC.
|
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
|
|
(In thousands, except per share)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thirteen
|
|
|
Thirteen
|
|
|
Twenty-six
|
|
|
Twenty-six
|
|
|
|
|
Weeks Ended
|
|
|
Weeks Ended
|
|
|
Weeks Ended
|
|
|
Weeks Ended
|
|
|
|
|
July 30, 2016
|
|
|
August 1, 2015
|
|
|
July 30, 2016
|
|
|
August 1, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
|
$
|
231,907
|
|
|
$
|
227,822
|
|
|
$
|
492,377
|
|
|
$
|
480,589
|
|
Cost of sales (including buying, distribution and occupancy costs)
|
|
|
|
164,677
|
|
|
|
161,548
|
|
|
|
349,591
|
|
|
|
339,626
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
|
|
67,230
|
|
|
|
66,274
|
|
|
|
142,786
|
|
|
|
140,963
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses
|
|
|
|
60,570
|
|
|
|
58,397
|
|
|
|
118,841
|
|
|
|
116,056
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
|
6,660
|
|
|
|
7,877
|
|
|
|
23,945
|
|
|
|
24,907
|
|
Interest income
|
|
|
|
(2
|
)
|
|
|
(31
|
)
|
|
|
(5
|
)
|
|
|
(34
|
)
|
Interest expense
|
|
|
|
41
|
|
|
|
42
|
|
|
|
84
|
|
|
|
84
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
|
|
6,621
|
|
|
|
7,866
|
|
|
|
23,866
|
|
|
|
24,857
|
|
Income tax expense
|
|
|
|
2,517
|
|
|
|
3,049
|
|
|
|
9,101
|
|
|
|
9,644
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$
|
4,104
|
|
|
$
|
4,817
|
|
|
$
|
14,765
|
|
|
$
|
15,213
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
|
0.22
|
|
|
$
|
0.24
|
|
|
$
|
0.78
|
|
|
$
|
0.76
|
|
Diluted
|
|
|
$
|
0.22
|
|
|
$
|
0.24
|
|
|
$
|
0.78
|
|
|
$
|
0.76
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
18,277
|
|
|
|
19,593
|
|
|
|
18,526
|
|
|
|
19,590
|
|
Diluted
|
|
|
|
18,282
|
|
|
|
19,606
|
|
|
|
18,531
|
|
|
|
19,604
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends declared per share
|
|
|
$
|
0.070
|
|
|
$
|
0.065
|
|
|
$
|
0.135
|
|
|
$
|
0.125
|
|
Financial Note:
Per share amounts are computed independently for each quarter of the
fiscal year. The sum of the quarters may not equal the total year due to
the impact of changes in weighted shares outstanding and differing
applications of earnings under the two-class method.
|
SHOE CARNIVAL, INC.
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
July 30, 2016
|
|
January 30, 2016
|
|
August 1, 2015
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Current Assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
41,549
|
|
$
|
68,814
|
|
$
|
39,503
|
Accounts receivable
|
|
|
3,185
|
|
|
2,131
|
|
|
2,449
|
Merchandise inventories
|
|
|
351,220
|
|
|
292,878
|
|
|
349,037
|
Deferred income taxes
|
|
|
2,680
|
|
|
1,061
|
|
|
1,154
|
Other
|
|
|
7,991
|
|
|
5,193
|
|
|
9,093
|
Total Current Assets
|
|
|
406,625
|
|
|
370,077
|
|
|
401,236
|
Property and equipment - net
|
|
|
103,363
|
|
|
103,386
|
|
|
105,817
|
Deferred income taxes
|
|
|
7,045
|
|
|
7,158
|
|
|
7,003
|
Other noncurrent assets
|
|
|
1,053
|
|
|
472
|
|
|
381
|
Total Assets
|
|
$
|
518,086
|
|
$
|
481,093
|
|
$
|
514,437
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
Current Liabilities:
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
116,989
|
|
$
|
72,086
|
|
$
|
95,934
|
Accrued and other liabilities
|
|
|
19,759
|
|
|
15,848
|
|
|
20,740
|
Total Current Liabilities
|
|
|
136,748
|
|
|
87,934
|
|
|
116,674
|
Deferred lease incentives
|
|
|
30,634
|
|
|
31,971
|
|
|
30,411
|
Accrued rent
|
|
|
11,407
|
|
|
11,224
|
|
|
11,137
|
Deferred compensation
|
|
|
10,022
|
|
|
9,612
|
|
|
10,313
|
Other
|
|
|
811
|
|
|
550
|
|
|
370
|
Total Liabilities
|
|
|
189,622
|
|
|
141,291
|
|
|
168,905
|
Total Shareholders' Equity
|
|
|
328,464
|
|
|
339,802
|
|
|
345,532
|
Total Liabilities and Shareholders' Equity
|
|
$
|
518,086
|
|
$
|
481,093
|
|
$
|
514,437
|
|
SHOE CARNIVAL, INC.
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
Twenty-six Weeks Ended July 30, 2016
|
|
Twenty-six Weeks Ended August 1, 2015
|
|
|
|
|
|
Cash Flows From Operating Activities
|
|
|
|
|
Net income
|
|
$
|
14,765
|
|
|
$
|
15,213
|
|
Adjustments to reconcile net income to net cash provided by (used
in) operating activities:
|
|
|
|
|
Depreciation and amortization
|
|
|
11,773
|
|
|
|
11,378
|
|
Stock-based compensation
|
|
|
2,123
|
|
|
|
1,752
|
|
Loss on retirement and impairment of assets
|
|
|
59
|
|
|
|
422
|
|
Deferred income taxes
|
|
|
(1,506
|
)
|
|
|
(2,973
|
)
|
Lease incentives
|
|
|
898
|
|
|
|
2,628
|
|
Other
|
|
|
(1,973
|
)
|
|
|
(1,804
|
)
|
Changes in operating assets and liabilities:
|
|
|
|
|
Accounts receivable
|
|
|
(1,054
|
)
|
|
|
230
|
|
Merchandise inventories
|
|
|
(58,341
|
)
|
|
|
(61,160
|
)
|
Accounts payable and accrued liabilities
|
|
|
49,229
|
|
|
|
34,369
|
|
Other
|
|
|
(3,381
|
)
|
|
|
(3,116
|
)
|
Net cash provided by (used in) operating activities
|
|
|
12,592
|
|
|
|
(3,061
|
)
|
|
|
|
|
|
Cash Flows From Investing Activities
|
|
|
|
|
Purchases of property and equipment
|
|
|
(11,910
|
)
|
|
|
(16,679
|
)
|
Proceeds from notes receivable
|
|
|
0
|
|
|
|
250
|
|
Net cash used in investing activities
|
|
|
(11,910
|
)
|
|
|
(16,429
|
)
|
|
|
|
|
|
Cash Flows From Financing Activities
|
|
|
|
|
Proceeds from issuance of stock
|
|
|
133
|
|
|
|
128
|
|
Dividends paid
|
|
|
(2,533
|
)
|
|
|
(2,497
|
)
|
Excess tax benefits from stock-based compensation
|
|
|
2
|
|
|
|
32
|
|
Purchase of common stock for treasury
|
|
|
(25,238
|
)
|
|
|
0
|
|
Shares surrendered by employees to pay taxes on restricted stock
|
|
|
(311
|
)
|
|
|
(46
|
)
|
Net cash used in financing activities
|
|
|
(27,947
|
)
|
|
|
(2,383
|
)
|
Net decrease in cash and cash equivalents
|
|
|
(27,265
|
)
|
|
|
(21,873
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
68,814
|
|
|
|
61,376
|
|
Cash and Cash Equivalents at End of Period
|
|
$
|
41,549
|
|
|
$
|
39,503
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20160831006305/en/
Source: Shoe Carnival, Inc.
Shoe Carnival
Cliff Sifford
President and Chief Executive
Officer
or W. Kerry Jackson
Senior Executive Vice President,
Chief
Operating and Financial Officer and Treasurer
812-867-6471
www.shoecarnival.com