Calendar Shift Hits Shoe Carnival’s Q3 Profit, Sales

In Industry News, Reports, What's New by Jeff PrineLeave a Comment

shoecarnivalEvansville, IN—Shoe Carnival Inc. reported Monday afternoon that its third quarter profit fell 11% mostly due to an unfavorable calendar shift compared with last year.

For the quarter ended Nov. 2, the footwear and accessories retailer posted a profit of $10.9 million, or 54 cents a share, compared with a profit of $12.2 million, or 60 cents a share, a year ago. That still managed to beat analysts’ average estimate for 53 cents a share.

October Sales Improvement

Net revenue declined 3.5% to $235.8 million. Due to the previous fiscal year having 53 weeks, the first three quarters of the current year shifted one week later, Shoe Carnival noted. As a result, a week of back-to-school sales included in last year’s third quarter shifted into the second quarter this year, cutting sales in the most recent period by about $21.2 million.

Comparable store sales edged up 0.7%. Meanwhile gross margin narrowed to 30.1% from 31.3% a year ago though imput costs decreased 1.9%. Merchandise margin remained unchanged, the company said.

“The arrival of October’s seasonably cool weather and an end to the federal government shutdown was a welcomed relief in the third quarter,” CEO Cliff Sifford said. “October’s mid-single digit comparable store sales gain, together with August’s sales performance, more than offset our negative September sales trend.”

Shoe Carnival, which sells name-brand and private-label footwear in the Midwest, South and Southeast, expanded opening 32 new stores so far this fiscal year. About five stores are scheduled to be closed by the end of the year, bringing total closings to seven.

Looking ahead, Shoe Carnival forecast fourth quarter earnings to come in between 18 to 22 cents a share on sales between $215 million to $219 million. Analysts’ consensus expects 20 cents a share and sales of $212 million.