News |
| Contacts: | |
| Investors | |
| Peggy Reilly Tharp, Brown Shoe Company | |
| (314) 854-4134, ptharp@brownshoe.com | |
| Kelly Malone, Brown Shoe Company | |
| (314) 854-4093, kmalone@brownshoe.com |
Brown Shoe Company Reports Fourth Quarter and Full Year 2012 Results
Famous Footwear same-store-sales up 4.4% in fourth quarter
Record breaking 52-week sales and operating profit at Famous Footwear
ST. LOUIS, Mar. 15, 2013 – Brown Shoe Company, Inc. (NYSE: BWS, brownshoe.com) today reported fourth quarter 2012 financial results, with net sales of $640.2 million versus fourth quarter 2011 net sales of $628.9 million. Results for both the fourth quarter of 2012 and 2011 included sales of $2.8 million and $16.5 million, respectively, from brands and businesses the company has exited. Excluding exited brands, year-over-year net sales were up 4.8% in the quarter.
Net earnings were $4.0 million, or $0.09 per diluted share, in the fourth quarter of 2012 versus a loss of ($8.2) million, or ($0.21) per diluted share, in the prior year. Fourth quarter 2012 results included portfolio realignment costs of $2.9 million, while earnings for the fourth quarter of 2011 included portfolio realignment and integration related costs of $18.5 million. On an adjusted* basis, net earnings of $5.9 million, or $0.14 per diluted share, improved 43.0% compared to $4.1 million, or $0.10 per diluted share, in the prior year.
For full year 2012, net sales of $2,598.1 million compared to $2,582.8 million in 2011. Results for both 2012 and 2011 included sales from exited brands and businesses of $42.5 million and $92.5 million, respectively. Excluding exited brands, 2012 sales were up 2.6% over 2011. Full year 2012 includes 53 weeks, compared to 52 weeks in 2011, with the additional week occurring in the fourth quarter. The 53rd week increased net sales by $21.2 million and had an immaterial impact on fourth quarter 2012 earnings.
Net earnings for 2012 were $27.5 million, or $0.64 per diluted share, versus $24.6 million, or $0.56 per diluted share, in 2011. Earnings for 2012 included portfolio realignment, organization change and integration related costs of $32.9 million, while earnings for 2011 included portfolio realignment and integration related costs of $30.8 million, which were partially offset by a $20.6 million gain on the sale of AND 1. On an adjusted basis, 2012 net earnings of $48.6 million, or $1.13 per diluted share, improved 60.4% compared to $30.3 million, or $0.70 per diluted share, in 2011.
Gross profit margin for the fourth quarter of 2012 improved to 39.3% from 37.9% in 2011. For the full year, it improved to 38.9% from 38.6% in 2011.
“In 2012, we hit several milestones at Famous Footwear, by achieving record-breaking sales for the 52-week year, as well as our highest annual operating profit,” said Diane Sullivan, president and chief executive officer of Brown Shoe Company. “We also strengthened our balance sheet, by reducing short term borrowings by nearly $100 million and reduced our SG&A expenses by $18.3 million. Thanks to the hard work of the entire Brown Shoe Company team, we ended 2012 on a high note, as our share price increased by 106% over the course of calendar 2012.”
| US$M, except per share (unaudited) | 14 Weeks | 13 Weeks | 4Q | 53 Weeks | 52 Weeks | FY |
| 4Q’12 | 4Q’11 | Change | 4Q’12 | 4Q’11 | Change | |
Consolidated net sales | $640.2 | $628.9 | 1.8% | $2,598.1 | $2,582.8 | 0.6% |
| Famous Footwear | 380.1 | 352.4 | 7.9% | 1,514.3 | 1,456.3 | 4.0% |
| Wholesale Operations | 194.5 | 205.1 | (5.2%) | 845.2 | 870.9 | (3.0%) |
| Specialty Retail | 65.6 | 71.4 | (8.1%) | 238.5 | 255.6 | (6.7%) |
| Gross profit | 251.7 | 238.6 | 5.5% | 1,010.4 | 996.6 | 1.4% |
| Margin | 39.3% | 37.9% | 140 bps | 38.9% | 38.6% | 30 bps |
| SG&A | 238.5 | 230.0 | 3.7% | 919.0 | 937.3 | (2.0%) |
| % of net sales | 37.3% | 36.6% | 70 bps | 35.4% | 36.3% | - 90 bps |
| Net restructuring, other special charges | 2.7 | 16.5 | (83.5%) | 24.0 | 23.7 | 1.5% |
| Impairment of intangible assets | -- | -- | -- | 5.8 | -- | -- |
| Operating earnings (loss) | 10.5 | (7.9) | n/m | 61.6 | 35.6 | 73.3% |
| % of net sales | 1.6% | (1.3%) | 290 bps | 2.4% | 1.4% | 100 bps |
| Net interest expense | 5.9 | 5.8 | 0.4% | 23.1 | 26.5 | (13.0%) |
| Earnings (loss) before income tax | 4.6 | (13.7) | n/m | 38.5 | 9.1 | 325.9% |
| Tax rate | 13.7% | 50.7% | 29.4% | 3.6% | ||
| Net earnings (loss) from discontinued operations | -- | (1.4) | -- | -- | 15.7 | -- |
| Net earnings (loss) | $4.0 | $(8.2) | 149.1% | $27.5 | $24.6 | 11.8% |
| Per diluted share | $0.09 | $(0.21) | 142.9% | $0.64 | $0.56 | 14.3% |
| Adjusted net earnings | $5.9 | $4.1 | 43.0% | $48.6 | $30.3 | 60.4% |
| Per diluted share | $0.14 | $0.10 | 40.0% | $1.13 | $0.70 | 61.4% |
Fourth Quarter Highlights
Famous Footwear reported record fourth quarter 2012 sales of $380.1 million, a 7.9% year-over-year improvement, with good growth in athletic shoes, boat shoes and women’s boots. On a 52 week same-store-sales basis, the fourth quarter was up 4.4% over the prior year. During the quarter, the company closed or relocated 18 stores and added 12 new stores, and average revenue per square foot improved 6.9% year-over-year.
Contemporary Fashion platform wholesale sales were up slightly in the fourth quarter, with the company’s Sam Edelman and Franco Sarto brands delivering strong performance. In the Healthy Living portfolio, wholesale sales were up 1.8%, with contribution from LifeStride, Ryka and Dr. Scholl’s Shoes. Excluding exited brands, Wholesale Operations sales were up 1.6% year-over-year in the fourth quarter.
Consolidated gross profit was up in the fourth quarter, while gross profit margin of 39.3% improved by approximately 140 basis points versus the prior year. SG&A for the fourth quarter was $238.5 million, or 37.3% of net sales, up approximately 70 basis points from 36.6% of net sales in the prior year. For the quarter, adjusted operating earnings improved 39.0% to $13.4 million from $9.7 million in the fourth quarter of 2011.
Inventory at the end of the fourth quarter was $533.3 million, down 5.1% compared to $561.8 million in the prior year. Wholesale inventory was down 21.6%, while Famous Footwear inventory was up 2.3%.
At quarter-end, Brown Shoe Company had $380.6 million in availability under its revolving credit facility and $68.2 million in cash and cash equivalents. The company’s debt-to-capital ratio declined to 41.6% from 49.1% in the fourth quarter of 2011.
Full Year Highlights
Famous Footwear reported full year 2012 sales of $1,514.3 million, a 4.0% year-over-year improvement, with adjusted annual operating earnings topping $100 million. On a 52-week basis, same-store-sales in 2012 were up 4.5% over 2011. During the year, the company closed or relocated 89 stores and added 55 new stores, and average revenue per square foot improved to $199.
Contemporary Fashion platform wholesale sales were up 11.0% in 2012, with the company’s Sam Edelman brand closing in on the $100 million sales threshold. In the Healthy Living portfolio, wholesale sales were down 3.5%. Excluding exited brands, Wholesale Operations sales were up 1.6% year-over-year in 2012.
Consolidated gross profit was up in 2012, while gross profit margin of 38.9% improved by approximately 30 basis points over 2011. SG&A for 2012 was $919.0 million, or 35.4% of net sales versus 36.3% in the prior year. For 2012, adjusted operating earnings improved 44.6% to $94.5 million from $65.4 million in 2011.
Financial Review and 2013 Outlook
“We’re pleased to have wrapped up a strong 2012, with adjusted diluted EPS of $1.13, up more than 60% over the prior year,” said Russ Hammer, chief financial officer of Brown Shoe Company. “However, like many other peers, we are beginning to see the effect on our consumers of recent payroll tax changes and other fiscal events. As a result, we remain cognizant about the potential for changes in consumer discretionary spending in 2013 and any related impact on our results.”
| Metric | FY’13 |
| Consolidated net sales | $2.55 to $2.58 billion |
| Famous Footwear same-store sales | Up low-single digits |
| Wholesale Operations net sales | Down low- to mid-single digits, reflecting brand exits |
| Gross profit margin | Up 10 to 40 basis points |
| SG&A | $900 to $910 million |
| Non-recurring costs | $1.0 to $2.0 million |
| Net interest expense | $21 to $23 million |
| Effective tax rate | 33% to 35% |
| Earnings per diluted share | $1.16 to $1.23 |
| Adjusted earnings per diluted share | $1.18 to $1.25 |
| Depreciation and amortization | $54 to $56 million |
| Capital expenditures | $50 to $55 million |
Investor Conference Call
Brown Shoe Company will webcast an investor conference call at 9:00 a.m. ET today, Mar. 15, 2013. The webcast and accompanying slides will be available at investor.brownshoe.com. 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 17574957. A replay will be available on the website 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 17574957 through Mar. 29, 2013.
* 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 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.
Definitions
All references in this press release, outside of the condensed consolidated financial statements that follow, unless otherwise noted, related to net earnings (loss) 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 ASG has manufacturing facilities and both ASG and Brown Shoe Company rely heavily on third-party 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 January 28, 2012, 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, Avia and Ryka. Our Contemporary Fashion brands — Via Spiga, Vera Wang, 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!
| SCHEDULE 1 | ||||||||||||||||
| BROWN SHOE COMPANY, INC. | ||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| 14 Weeks Ended | 13 Weeks Ended | 53 Weeks Ended | 52 Weeks Ended | |||||||||||||
| (Thousands, except per share data) | February 2, 2013 | January 28, 2012 | February 2, 2013 | January 28, 2012 | ||||||||||||
| Net sales | $ | 640,176 | $ | 628,891 | $ | 2,598,065 | $ | 2,582,824 | ||||||||
| Cost of goods sold | 388,477 | 390,318 | 1,587,706 | 1,586,184 | ||||||||||||
| Gross profit | 251,699 | 238,573 | 1,010,359 | 996,640 | ||||||||||||
| Selling and administrative expenses | 238,465 | 229,943 | 918,957 | 937,419 | ||||||||||||
| Restructuring and other special charges, net | 2,730 | 16,523 | 24,018 | 23,671 | ||||||||||||
| Impairment of intangible assets | - | - | 5,777 | - | ||||||||||||
| Operating earnings (loss) | 10,504 | (7,893 | ) | 61,607 | 35,550 | |||||||||||
| Interest expense | (5,954 | ) | (6,238 | ) | (23,382 | ) | (26,141 | ) | ||||||||
| Loss on early extinguishment of debt | - | - | - | (1,003 | ) | |||||||||||
| Interest income | 86 | 396 | 322 | 644 | ||||||||||||
| Earnings (loss) before income taxes from continuing operations | 4,636 | (13,735 | ) | 38,547 | 9,050 | |||||||||||
| Income tax (provision) benefit | (633 | ) | 6,968 | (11,343 | ) | (326 | ) | |||||||||
| Net earnings (loss) from continuing operations | 4,003 | (6,767 | ) | 27,204 | 8,724 | |||||||||||
| Discontinued operations: | ||||||||||||||||
| Earnings from operations of subsidiary, net of tax of $1,312 in 2011 | - | - | - | 1,701 | ||||||||||||
| (Loss) gain on sale of subsidiary, net of tax of $474 and $6,670 in 2011, respectively | - | (1,409 | ) | - | 13,965 | |||||||||||
| Net (loss) earnings from discontinued operations | - | (1,409 | ) | - | 15,666 | |||||||||||
| Net earnings (loss) | 4,003 | (8,176 | ) | 27,204 | 24,390 | |||||||||||
| Net (loss) earnings attributable to noncontrolling interests | (36 | ) | 46 | (287 | ) | (199 | ) | |||||||||
| Net earnings (loss) attributable to Brown Shoe Company, Inc. | $ | 4,039 | $ | (8,222 | ) | $ | 27,491 | $ | 24,589 | |||||||
| Basic earnings (loss) per common share: | ||||||||||||||||
| From continuing operations | $ | 0.09 | $ | (0.17 | ) | $ | 0.64 | $ | 0.20 | |||||||
| From discontinued operations | - | (0.04 | ) | - | 0.37 | |||||||||||
| Basic earnings (loss) per common share attributable to Brown Shoe Company, Inc. shareholders | $ | 0.09 | $ | (0.21 | ) | $ | 0.64 | $ | 0.57 | |||||||
| Diluted earnings (loss) per common share: | ||||||||||||||||
| From continuing operations | $ | 0.09 | $ | (0.17 | ) | $ | 0.64 | $ | 0.20 | |||||||
| From discontinued operations | - | (0.04 | ) | - | 0.36 | |||||||||||
| Diluted earnings (loss) per common share attributable to Brown Shoe Company, Inc. shareholders | $ | 0.09 | $ | (0.21 | ) | $ | 0.64 | $ | 0.56 | |||||||
| Basic number of shares | 40,774 | 40,098 | 40,659 | 41,126 | ||||||||||||
| Diluted number of shares | 41,109 | 40,668 | 40,794 | 41,668 | ||||||||||||
| SCHEDULE 2 | ||||||||
| BROWN SHOE COMPANY, INC. | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (Thousands) | February 2, 2013 | January 28, 2012 | ||||||
| ASSETS | ||||||||
| Cash and cash equivalents | $ | 68,223 | $ | 47,682 | ||||
| Receivables, net | 125,683 | 154,022 | ||||||
| Inventories, net | 533,275 | 561,797 | ||||||
| Deferred income taxes | - | 14,432 | ||||||
| Income taxes | 3,069 | 5,145 | ||||||
| Prepaid expenses and other current assets | 42,178 | 32,060 | ||||||
| Total current assets | 772,428 | 815,138 | ||||||
| Property and equipment, net | 146,089 | 131,471 | ||||||
| Deferred income taxes | 1,461 | - | ||||||
| Goodwill and intangible assets, net | 132,628 | 140,590 | ||||||
| Other assets | 118,653 | 140,277 | ||||||
| Total assets | $ | 1,171,259 | $ | 1,227,476 | ||||
| LIABILITIES AND EQUITY | ||||||||
| Borrowings under revolving credit agreement | $ | 105,000 | $ | 201,000 | ||||
| Trade accounts payable | 222,742 | 190,611 | ||||||
| Deferred income taxes | 748 | - | ||||||
| Other accrued expenses | 140,619 | 132,969 | ||||||
| Total current liabilities | 469,109 | 524,580 | ||||||
| Long-term debt | 198,823 | 198,633 | ||||||
| Deferred rent | 33,711 | 32,361 | ||||||
| Deferred income taxes | 13,862 | 31,136 | ||||||
| Other liabilities | 29,853 | 27,050 | ||||||
| Total other liabilities | 276,249 | 289,180 | ||||||
| Total Brown Shoe Company, Inc. shareholders’ equity | 425,129 | 412,669 | ||||||
| Noncontrolling interests | 772 | 1,047 | ||||||
| Total equity | 425,901 | 413,716 | ||||||
| Total liabilities and equity | $ | 1,171,259 | $ | 1,227,476 | ||||
| SCHEDULE 3 | ||||||||
| BROWN SHOE COMPANY, INC. | ||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| 53 Weeks Ended | 52 Weeks Ended | |||||||
| (Thousands) | February 2, 2013 | January 28, 2012 | ||||||
| OPERATING ACTIVITIES: | ||||||||
| Net earnings | $ | 27,204 | $ | 24,390 | ||||
| Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | 54,783 | 59,111 | ||||||
| Amortization of debt issuance costs | 2,561 | 2,338 | ||||||
| Loss on early extinguishment of debt | - | 1,003 | ||||||
| Share-based compensation expense | 6,489 | 5,633 | ||||||
| Tax benefit related to share-based plans | (944 | ) | (1,000 | ) | ||||
| Loss on disposal of facilities and equipment | 3,103 | 1,560 | ||||||
| Impairment charges for facilities and equipment | 4,132 | 1,871 | ||||||
| Impairment of intangible assets | 5,777 | - | ||||||
| Deferred rent | 1,350 | (2,317 | ) | |||||
| Deferred income taxes benefit | (3,555 | ) | (112 | ) | ||||
| Provision for doubtful accounts | 360 | 1,284 | ||||||
| Gain on sale of subsidiary, net | - | (13,965 | ) | |||||
| Changes in operating assets and liabilities, net of acquired and discontinued operations: | ||||||||
| Receivables | 27,984 | (26,298 | ) | |||||
| Inventories | 28,623 | 3,502 | ||||||
| Prepaid expenses and other current and noncurrent assets | (9,169 | ) | 2,286 | |||||
| Trade accounts payable | 32,091 | 13,660 | ||||||
| Accrued expenses and other liabilities | 10,436 | (35,117 | ) | |||||
| Income taxes | 2,076 | 12,512 | ||||||
| Other, net | 4,636 | (2,255 | ) | |||||
| Net cash provided by operating activities | 197,937 | 48,086 | ||||||
| INVESTING ACTIVITIES: | ||||||||
| Capital Expenditures | (63,729 | ) | (38,564 | ) | ||||
| Acquisition cost | (5,000 | ) | (156,636 | ) | ||||
| Cash recognized on initial consolidation | - | 3,121 | ||||||
| Net proceeds from sale of subsidiary | - | 55,350 | ||||||
| Net cash used for investing activities | (68,729 | ) | (136,729 | ) | ||||
| FINANCING ACTIVITIES: | ||||||||
| Borrowings under revolving credit agreement | 805,000 | 1,595,500 | ||||||
| Repayments under revolving credit agreement | (901,000 | ) | (1,592,500 | ) | ||||
| Proceeds from issuance of 2019 Senior Notes | - | 198,633 | ||||||
| Redemption of 2012 Senior Notes | - | (150,000 | ) | |||||
| Dividends paid | (12,011 | ) | (12,076 | ) | ||||
| Debt issuance costs | - | (6,428 | ) | |||||
| Acquisition of treasury stock | - | (25,484 | ) | |||||
| Issuance of common stock under share-based plans, net | (1,700 | ) | 918 | |||||
| Tax benefit related to share-based plans | 944 | 1,000 | ||||||
| Contributions by noncontrolling interest | - | 378 | ||||||
| Net cash (used for) provided by financing activities | (108,767 | ) | 9,941 | |||||
| Effect of exchange rate changes on cash and cash equivalents | 100 | (164 | ) | |||||
| Increase (decrease) in cash and cash equivalents | 20,541 | (78,866 | ) | |||||
| Cash and cash equivalents at beginning of period | 47,682 | 126,548 | ||||||
| Cash and cash equivalents at end of period | $ | 68,223 | $ | 47,682 | ||||
| SCHEDULE 4 | ||||||||||||||||||||||||
| BROWN SHOE COMPANY, 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) | (Unaudited) | |||||||||||||||||||||||
| 14 Weeks Ended February 2, 2013 | 13 Weeks Ended January 28, 2012 | |||||||||||||||||||||||
| (Thousands, except per share data) | Pre-Tax Impact of Charges/ Other Items | Net Earnings Attributable to Brown Shoe Company, Inc. | Diluted Earnings Per Share | Pre-Tax Impact of Charges/ Other Items | Net (Loss) Earnings Attributable to Brown Shoe Company, Inc. | Diluted (Loss) Earnings Per Share | ||||||||||||||||||
| GAAP earnings (loss) | $ | 4,039 | $ | 0.09 | $ | (8,222 | ) | $ | (0.21 | ) | ||||||||||||||
| Charges/Other Items: | ||||||||||||||||||||||||
| Portfolio realignment | ||||||||||||||||||||||||
| Business exits and cost reductions | $ | 2,942 | 1,827 | 0.05 | $ | 14,649 | 9,285 | 0.23 | ||||||||||||||||
| Loss on sale of subsidiary | - | - | - | 935 | 1,409 | 0.04 | ||||||||||||||||||
| ASG integration-related costs | - | - | - | 2,917 | 1,629 | 0.04 | ||||||||||||||||||
| Total charges/other items | $ | 2,942 | 1,827 | 0.05 | $ | 18,501 | 12,323 | 0.31 | ||||||||||||||||
| Adjusted earnings | $ | 5,866 | $ | 0.14 | $ | 4,101 | $ | 0.10 | ||||||||||||||||
| 53 Weeks Ended February 2, 2013 | 52 Weeks Ended January 28, 2012 | |||||||||||||||||||||||
| (Thousands, except per share data) | Pre-Tax Impact of Charges/ Other Items | Net Earnings Attributable to Brown Shoe Company, Inc. | Diluted Earnings Per Share | Pre-Tax Impact of Charges/ Other Items | Net Earnings Attributable to Brown Shoe Company, Inc. | Diluted Earnings Per Share | ||||||||||||||||||
| GAAP earnings | $ | 27,491 | $ | 0.64 | $ | 24,589 | $ | 0.56 | ||||||||||||||||
| Charges/Other Items: | ||||||||||||||||||||||||
| Portfolio realignment | ||||||||||||||||||||||||
| Gain on sale of subsidiary | $ | - | - | - | $ | (20,635 | ) | (13,965 | ) | (0.32 | ) | |||||||||||||
| Business exits and cost reductions | 29,944 | 19,266 | 0.45 | 19,154 | 12,036 | 0.28 | ||||||||||||||||||
| Organizational change | 2,283 | 1,395 | 0.03 | - | - | - | ||||||||||||||||||
| ASG acquisition and integration-related costs | 675 | 441 | 0.01 | 6,457 | 4,519 | 0.11 | ||||||||||||||||||
ASG cost of goods sold adjustment (1) | - | - | - | 4,189 | 2,477 | 0.05 | ||||||||||||||||||
| Loss on early extinguishment of debt | - | - | - | 1,003 | 638 | 0.02 | ||||||||||||||||||
| Total charges/other items | $ | 32,902 | 21,102 | 0.49 | $ | 10,168 | 5,705 | 0.14 | ||||||||||||||||
| Adjusted earnings | $ | 48,593 | $ | 1.13 | $ | 30,294 | $ | 0.70 | ||||||||||||||||
| (1) In accordance with GAAP, purchase accounting rules require the company to record inventory at fair value (i.e., expected selling price less costs to sell) on the acquisition date. This results in lower than typical gross margins when the acquired inventory is sold. This adjustment reflects the elimination of the unfavorable impact of lower gross margins for ASG product sold in the first and second quarters of 2011. | ||||||||||||||||||||||||
| SCHEDULE 5 | ||||||||||||||||||||||||||||||||||||||||
| BROWN SHOE COMPANY, INC. | ||||||||||||||||||||||||||||||||||||||||
| SUMMARY FINANCIAL RESULTS BY SEGMENT | ||||||||||||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||||||||||||
| SUMMARY FINANCIAL RESULTS | ||||||||||||||||||||||||||||||||||||||||
| Famous Footwear | Wholesale Operations | Specialty Retail | Other | Consolidated | ||||||||||||||||||||||||||||||||||||
| 14 Weeks Ended | 13 Weeks Ended | 14 Weeks Ended | 13 Weeks Ended | 14 Weeks Ended | 13 Weeks Ended | 14 Weeks Ended | 13 Weeks Ended | 14 Weeks Ended | 13 Weeks Ended | |||||||||||||||||||||||||||||||
| February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | |||||||||||||||||||||||||||||||
| (Thousands) | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||||||||||
| Net Sales | $ | 380,112 | $ | 352,414 | $ | 194,452 | $ | 205,102 | $ | 65,612 | $ | 71,375 | $ | - | $ | - | $ | 640,176 | $ | 628,891 | ||||||||||||||||||||
| Gross Profit | $ | 167,376 | $ | 151,269 | $ | 58,101 | $ | 59,686 | $ | 26,222 | $ | 27,618 | $ | - | $ | - | $ | 251,699 | $ | 238,573 | ||||||||||||||||||||
| Adjusted Gross Profit | $ | 167,376 | $ | 151,269 | $ | 58,229 | $ | 60,346 | $ | 26,305 | $ | 28,000 | $ | - | $ | - | $ | 251,910 | $ | 239,615 | ||||||||||||||||||||
| Gross Profit Rate | 44.0% | 42.9% | 29.9% | 29.1% | 40.0% | 38.7% | - | - | 39.3% | 37.9% | ||||||||||||||||||||||||||||||
| Adjusted Gross Profit Rate | 44.0% | 42.9% | 29.9% | 29.4% | 40.1% | 39.2% | - | - | 39.4% | 38.1% | ||||||||||||||||||||||||||||||
| Operating Earnings (Loss) | $ | 19,731 | $ | 7,864 | $ | 2,753 | $ | (1,763 | ) | $ | (1,299 | ) | $ | (924) | $ | (10,681 | ) | $ | (13,070 | ) | $ | 10,504 | $ | (7,893 | ) | |||||||||||||||
| Adjusted Operating Earnings (Loss) | $ | 19,813 | $ | 10,616 | $ | 5,315 | $ | 8,272 | $ | (1,108 | ) | $ | 69 | $ | (10,574 | ) | $ | (9,284 | ) | $ | 13,446 | $ | 9,673 | |||||||||||||||||
| Operating Earnings (Loss) % | 5.2% | 2.2% | 1.4% | (0.9%) | (2.0%) | (1.3%) | - | - | 1.6 | % | (1.0%) | |||||||||||||||||||||||||||||
| Adjusted Operating Earnings (Loss) % | 5.2% | 3.0% | 2.7% | 4.0% | (1.7%) | 0.1% | - | - | 2.1 | % | 1.5% | |||||||||||||||||||||||||||||
| Same-store Sales % (on a 13-week basis) | 4.4% | (0.8%) | - | - | (7.1%) | 4.7% | - | - | - | - | ||||||||||||||||||||||||||||||
| Number of Stores | 1,055 | 1,089 | - | - | 222 | 234 | - | - | 1,277 | 1,323 | ||||||||||||||||||||||||||||||
| RECONCILIATION OF ADJUSTED RESULTS (NON-GAAP) | ||||||||||||||||||||||||||||||||||||||||
| Famous Footwear | Wholesale Operations | Specialty Retail | Other | Consolidated | ||||||||||||||||||||||||||||||||||||
| 14 Weeks Ended | 13 Weeks Ended | 14 Weeks Ended | 13 Weeks Ended | 14 Weeks Ended | 13 Weeks Ended | 14 Weeks Ended | 13 Weeks Ended | 14 Weeks Ended | 13 Weeks Ended | |||||||||||||||||||||||||||||||
| February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | |||||||||||||||||||||||||||||||
| (Thousands) | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||||||||||
| Gross Profit | $ | 167,376 | $ | 151,269 | $ | 58,101 | $ | 59,686 | $ | 26,222 | $ | 27,618 | $ | - | $ | - | $ | 251,699 | $ | 238,573 | ||||||||||||||||||||
Charges/Other Items: | ||||||||||||||||||||||||||||||||||||||||
| Portfolio realignment | ||||||||||||||||||||||||||||||||||||||||
| Business exits and cost reductions | - | - | 128 | 660 | 83 | 382 | - | - | 211 | 1,042 | ||||||||||||||||||||||||||||||
| Total charges/other items | - | - | 128 | 660 | 83 | 382 | - | - | 211 | 1,042 | ||||||||||||||||||||||||||||||
| Adjusted Gross Profit | $ | 167,376 | $ | 151,269 | $ | 58,229 | $ | 60,346 | $ | 26,305 | $ | 28,000 | $ | - | $ | - | $ | 251,910 | $ | 239,615 | ||||||||||||||||||||
| Operating Earnings (Loss) | $ | 19,731 | $ | 7,864 | $ | 2,753 | $ | (1,763 | ) | $ | (1,299 | ) | $ | (924 | ) | $ | (10,681 | ) | $ | (13,070 | ) | $ | 10,504 | $ | (7,893 | ) | ||||||||||||||
Charges/Other Items: | ||||||||||||||||||||||||||||||||||||||||
| Portfolio realignment | ||||||||||||||||||||||||||||||||||||||||
| Business exits and cost reductions | 82 | 2,752 | 2,562 | 7,542 | 191 | 993 | 107 | 3,362 | 2,942 | 14,649 | ||||||||||||||||||||||||||||||
| ASG acquisition and integration-related costs | - | - | - | 2,493 | - | - | - | 424 | - | 2,917 | ||||||||||||||||||||||||||||||
| Total charges/other items | 82 | 2,752 | 2,562 | 10,035 | 191 | 993 | 107 | 3,786 | 2,942 | 17,566 | ||||||||||||||||||||||||||||||
| Adjusted Operating Earnings (Loss) | $ | 19,813 | $ | 10,616 | $ | 5,315 | $ | 8,272 | $ | (1,108 | ) | $ | 69 | $ | (10,574 | ) | $ | (9,284 | ) | $ | 13,446 | $ | 9,673 | |||||||||||||||||
| SCHEDULE 5 - CONTINUED | ||||||||||||||||||||||||||||||||||||||||
| BROWN SHOE COMPANY, INC. | ||||||||||||||||||||||||||||||||||||||||
| SUMMARY FINANCIAL RESULTS BY SEGMENT | ||||||||||||||||||||||||||||||||||||||||
| SUMMARY FINANCIAL RESULTS | ||||||||||||||||||||||||||||||||||||||||
| Famous Footwear | Wholesale Operations | Specialty Retail | Other | Consolidated | ||||||||||||||||||||||||||||||||||||
| 53 Weeks Ended | 52 Weeks Ended | 53 Weeks Ended | 52 Weeks Ended | 53 Weeks Ended | 52 Weeks Ended | 53 Weeks Ended | 52 Weeks Ended | 53 Weeks Ended | 52 Weeks Ended | |||||||||||||||||||||||||||||||
| February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | |||||||||||||||||||||||||||||||
| (Thousands) | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||||||||||
| Net Sales | $ | 1,514,349 | $ | 1,456,314 | $ | 845,176 | $ | 870,873 | $ | 238,540 | $ | 255,637 | $ | - | $ | - | $ | 2,598,065 | $ | 2,582,824 | ||||||||||||||||||||
| Gross Profit | $ | 666,094 | $ | 635,221 | $ | 245,582 | $ | 256,346 | $ | 98,683 | $ | 105,073 | $ | - | $ | - | $ | 1,010,359 | $ | 996,640 | ||||||||||||||||||||
| Adjusted Gross Profit | $ | 666,094 | $ | 635,221 | $ | 248,309 | $ | 262,092 | $ | 99,062 | $ | 105,455 | $ | - | $ | - | $ | 1,013,465 | $ | 1,002,768 | ||||||||||||||||||||
| Gross Profit Rate | 44.0% | 43.6% | 29.1% | 29.4% | 41.4% | 41.1% | - | - | 38.9% | 38.6% | ||||||||||||||||||||||||||||||
| Adjusted Gross Profit Rate | 44.0% | 43.6% | 29.4% | 30.1% | 41.5% | 41.3% | - | - | 39.0% | 38.8% | ||||||||||||||||||||||||||||||
| Operating Earnings (Loss) | $ | 94,096 | $ | 62,515 | $ | 17,581 | $ | 16,739 | $ | (8,850 | ) | $ | (7,627 | ) | $ | (41,220 | ) | $ | (36,077 | ) | $ | 61,607 | $ | 35,550 | ||||||||||||||||
| Adjusted Operating Earnings (Loss) | $ | 101,865 | $ | 65,267 | $ | 35,338 | $ | 35,468 | $ | (4,755 | ) | $ | (6,634 | ) | $ | (37,939 | ) | $ | (28,751 | ) | $ | 94,509 | $ | 65,350 | ||||||||||||||||
| Operating Earnings (Loss) % | 6.2% | 4.3% | 2.1% | 1.9% | (3.7%) | (3.0%) | - | - | 2.4% | 1.4% | ||||||||||||||||||||||||||||||
| Adjusted Operating Earnings (Loss) % | 6.7% | 4.5% | 4.2% | 4.1% | (2.0%) | (2.6%) | - | - | 3.6% | 2.5% | ||||||||||||||||||||||||||||||
| Same-store Sales % (on a 52-week basis) | 4.5% | (1.2%) | - | - | 0.6% | 1.7% | - | - | - | - | ||||||||||||||||||||||||||||||
| Number of Stores | 1,055 | 1,089 | - | - | 222 | 234 | - | - | 1,277 | 1,323 | ||||||||||||||||||||||||||||||
| RECONCILIATION OF ADJUSTED RESULTS (NON-GAAP) | ||||||||||||||||||||||||||||||||||||||||
| Famous Footwear | Wholesale Operations | Specialty Retail | Other | Consolidated | ||||||||||||||||||||||||||||||||||||
| 53 Weeks Ended | 52 Weeks Ended | 53 Weeks Ended | 52 Weeks Ended | 53 Weeks Ended | 52 Weeks Ended | 53 Weeks Ended | 52 Weeks Ended | 53 Weeks Ended | 52 Weeks Ended | |||||||||||||||||||||||||||||||
| February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | February 2, | January 28, | |||||||||||||||||||||||||||||||
| (Thousands) | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||||||||||
| Gross Profit | $ | 666,094 | $ | 635,221 | $ | 245,582 | $ | 256,346 | $ | 98,683 | $ | 105,073 | $ | - | $ | - | $ | 1,010,359 | $ | 996,640 | ||||||||||||||||||||
Charges/Other Items: | ||||||||||||||||||||||||||||||||||||||||
| Portfolio realignment | ||||||||||||||||||||||||||||||||||||||||
| Business exits and cost reductions | - | - | 2,727 | 1,557 | 379 | 382 | - | - | 3,106 | 1,939 | ||||||||||||||||||||||||||||||
| ASG cost of good sold adjustment | - | - | - | 4,189 | - | - | - | - | - | 4,189 | ||||||||||||||||||||||||||||||
| Total charges/other items | - | - | 2,727 | 5,746 | 379 | 382 | - | - | 3,106 | 6,128 | ||||||||||||||||||||||||||||||
| Adjusted Gross Profit | $ | 666,094 | $ | 635,221 | $ | 248,309 | $ | 262,092 | $ | 99,062 | $ | 105,455 | $ | - | $ | - | $ | 1,013,465 | $ | 1,002,768 | ||||||||||||||||||||
| Operating Earnings (Loss) | $ | 94,096 | $ | 62,515 | $ | 17,581 | $ | 16,739 | $ | (8,850 | ) | $ | (7,627 | ) | $ | (41,220 | ) | $ | (36,077 | ) | $ | 61,607 | $ | 35,550 | ||||||||||||||||
Charges/Other Items: | ||||||||||||||||||||||||||||||||||||||||
| Portfolio realignment | ||||||||||||||||||||||||||||||||||||||||
| Business exits and cost reductions | 7,769 | 2,752 | 17,082 | 12,047 | 4,095 | �� | 993 | 998 | 3,362 | 29,944 | 19,154 | |||||||||||||||||||||||||||||
| Organizational change | - | - | - | - | - | - | 2,283 | - | 2,283 | - | ||||||||||||||||||||||||||||||
| ASG acquisition and integration-related costs | - | - | 675 | 2,493 | - | - | - | 3,964 | 675 | 6,457 | ||||||||||||||||||||||||||||||
| ASG cost of good sold adjustment | - | - | - | 4,189 | - | - | - | - | - | 4,189 | ||||||||||||||||||||||||||||||
| Total charges/other items | 7,769 | 2,752 | 17,757 | 18,729 | 4,095 | 993 | 3,281 | 7,326 | 32,902 | 29,800 | ||||||||||||||||||||||||||||||
| Adjusted Operating Earnings (Loss) | $ | 101,865 | $ | 65,267 | $ | 35,338 | $ | 35,468 | $ | (4,755 | ) | $ | (6,634 | ) | $ | (37,939 | ) | $ | (28,751 | ) | $ | 94,509 | $ | 65,350 | ||||||||||||||||
| SCHEDULE 6 | ||||||||||||||||
| BROWN SHOE COMPANY, INC. | ||||||||||||||||
| BASIC AND DILUTED EARNINGS PER SHARE RECONCILIATION | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| 14 Weeks Ended | 13 Weeks Ended | 53 Weeks Ended | 52 Weeks Ended | |||||||||||||
| February 2, | January 28, | February 2, | January 28, | |||||||||||||
| (Thousands, except per share data) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
| Net earnings (loss) attributable to Brown Shoe Company, Inc.: | ||||||||||||||||
| Net earnings (loss) from continuing operations | $ | 4,003 | $ | (6,767 | ) | $ | 27,204 | $ | 8,724 | |||||||
| Net loss (earnings) attributable to noncontrolling interests | 36 | (46 | ) | 287 | 199 | |||||||||||
| Net earnings allocated to participating securities | (199 | ) | - | (1,365 | ) | (529 | ) | |||||||||
| Net earnings (loss) from continuing operations | 3,840 | (6,813 | ) | 26,126 | 8,394 | |||||||||||
| Net (loss) earnings from discontinued operations | - | (1,409 | ) | - | 15,666 | |||||||||||
| Net earnings allocated to participating securities | - | - | - | (668 | ) | |||||||||||
| Net (loss) earnings from discontinued operations | - | (1,409 | ) | - | 14,998 | |||||||||||
| Net earnings (loss) attributable to Brown Shoe Company, Inc. after allocation of earnings to participating securities | $ | 3,840 | $ | (8,222 | ) | $ | 26,126 | $ | 23,392 | |||||||
| Basic and diluted common shares attributable to Brown Shoe Company, Inc.: | ||||||||||||||||
| Basic common shares for continuing operations and discontinued operations | 40,774 | 40,098 | 40,659 | 41,126 | ||||||||||||
| Dilutive effect of share-based awards for continuing operations and discontinued operations | 335 | 570 | 135 | 542 | ||||||||||||
| Diluted common shares for continuing operations and discontinued operations attributable to Brown Shoe Company, Inc. | 41,109 | 40,668 | 40,794 | 41,668 | ||||||||||||
| Basic earnings (loss) per share: | ||||||||||||||||
| From continuing operations | $ | 0.09 | $ | (0.17 | ) | $ | 0.64 | $ | 0.20 | |||||||
| From discontinued operations | - | (0.04 | ) | - | 0.37 | |||||||||||
| Basic earnings (loss) per common share attributable to Brown Shoe Company, Inc. shareholders | $ | 0.09 | $ | (0.21 | ) | $ | 0.64 | $ | 0.57 | |||||||
| Diluted earnings (loss) per share: | ||||||||||||||||
| From continuing operations | $ | 0.09 | $ | (0.17 | ) | $ | 0.64 | $ | 0.20 | |||||||
| From discontinued operations | - | (0.04 | ) | - | 0.36 | |||||||||||
| Diluted earnings (loss) per common share attributable to Brown Shoe Company, Inc. shareholders | $ | 0.09 | $ | (0.21 | ) | $ | 0.64 | $ | 0.56 | |||||||
| SCHEDULE 7 | ||||||||||||||||
| BROWN SHOE COMPANY, INC. | ||||||||||||||||
| BASIC AND DILUTED ADJUSTED EARNINGS PER SHARE RECONCILIATION | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| 14 Weeks Ended | 13 Weeks Ended | 53 Weeks Ended | 52 Weeks Ended | |||||||||||||
| February 2, | January 28, | February 2, | January 28, | |||||||||||||
| (Thousands, except per share data) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
| Adjusted net earnings attributable to Brown Shoe Company, Inc.: | ||||||||||||||||
| Adjusted net earnings from continuing operations | $ | 5,830 | $ | 4,147 | $ | 48,306 | $ | 28,394 | ||||||||
| Net loss (earnings) attributable to noncontrolling interests | 36 | (46 | ) | 287 | 199 | |||||||||||
| Net earnings allocated to participating securities | (289 | ) | (182 | ) | (2,404 | ) | (1,234 | ) | ||||||||
| Adjusted net earnings from continuing operations | 5,577 | 3,919 | 46,189 | 27,359 | ||||||||||||
| Adjusted net earnings from discontinued operations | - | - | - | 1,701 | ||||||||||||
| Net earnings allocated to participating securities | - | - | - | (73 | ) | |||||||||||
| Net earnings from discontinued operations | - | - | - | 1,628 | ||||||||||||
| Adjusted net earnings attributable to Brown Shoe Company, Inc. after allocation of earnings to participating securities | $ | 5,577 | $ | 3,919 | $ | 46,189 | $ | 28,987 | ||||||||
| Basic and diluted common shares attributable to Brown Shoe Company, Inc.: | ||||||||||||||||
| Basic common shares for continuing operations and discontinued operations | 40,774 | 40,098 | 40,659 | 41,126 | ||||||||||||
| Dilutive effect of share-based awards for continuing operations and discontinued operations | 335 | 570 | 135 | 542 | ||||||||||||
| Diluted common shares for continuing operations and discontinued operations attributable to Brown Shoe Company, Inc. | 41,109 | 40,668 | 40,794 | 41,668 | ||||||||||||
| Basic adjusted earnings per share: | ||||||||||||||||
| From continuing operations | $ | 0.14 | $ | 0.10 | $ | 1.14 | $ | 0.67 | ||||||||
| From discontinued operations | - | - | - | 0.04 | ||||||||||||
| Basic adjusted earnings per common share attributable to Brown Shoe Company, Inc. shareholders | $ | 0.14 | $ | 0.10 | $ | 1.14 | $ | 0.71 | ||||||||
| Diluted adjusted earnings per share: | ||||||||||||||||
| From continuing operations | $ | 0.14 | $ | 0.10 | $ | 1.13 | $ | 0.66 | ||||||||
| From discontinued operations | - | - | - | 0.04 | ||||||||||||
| Diluted adjusted earnings per common share attributable to Brown Shoe Company, Inc. shareholders | $ | 0.14 | $ | 0.10 | $ | 1.13 | $ | 0.70 | ||||||||