Shoe Carnival Shares Were Off 5.8% after the retailer warned that lower traffic in the stores would push sales lower than expected for the second quarter and warned that earnings are now expected to be in the range of 10 cents to 13 cents per diluted share for the quarter. SCVL delivered 27 cents EPS in Q2 2002.
June comps decreased 5.4% after posting a 3.4% increase last year. Total sales for the month increased 4.1% to $47.5 million. Womens casual/dress comps were down in the low teens and Mens casual/dress was off in the high singles. Athletic was flat to the year-ago period. Total footwear comps were down 5.0%.
CEO Mark Lemond said the company reacted to the negative trend and adjusted inventories in seasonal footwear, particularly sandals and other summer product as needed. While they see product margins only slightly lower than last year, overall gross margins will be down more sharply due to the “deleveraging effect of lower sales on buying, distribution and occupancy costs. SCVL has been taking advantage of increased availability of off-price athletic footwear to bolster its offerings and margin opportunities for Back-to-School.
