Brown Shoe Company, Inc. reported that June retail sales for Famous Footwear were $98.6 million for the five-week period ended July 3, 2004, a 0.4% decrease compared to $99.0 million for the same period last year. Same-store sales for the period decreased 3.2%.
Sales for the first 22 weeks of 2004 were $455,800,000, a 2.4 percent increase compared to the same period last year. Same-store sales for the 22 weeks were up 0.4 percent.
Retail sales at Brown Shoe's Naturalizer Retail division, a 380-store chain selling the Naturalizer brand of women's footwear in the United States and Canada, were $18,100,000 for the month compared to $19,400,000 last June. Same-store sales declined 6.5 percent.
“Our retail sales in June were below plan, as customer traffic was soft for both our Famous Footwear and Naturalizer retail concepts,” said Brown Shoe Chairman and CEO Ron Fromm. “At Famous Footwear, our sales of athletic footwear continued strong, spurred by the introduction of exclusive product; this was not enough, however, to offset weakness in our seasonal sandal and women's casual footwear categories. Our sales shortfall at Naturalizer was also due to lower sales of casual and sandalized footwear in the U.S. and throughout Canada.”
Revised Guidance – Second Quarter and Full Year
“While continuing good margin performance at Famous Footwear should allow this division to meet its second quarter profit plan, weakness in our Naturalizer Retail chain and in our children's wholesale business will result in an earnings shortfall for second quarter. Accordingly, we are lowering our second quarter diluted earnings per share guidance range to $0.45 to $0.50, inclusive of $0.05 in transition costs related to our new Bass license,” Fromm said.
The Company previously had issued an earnings guidance range of $0.60 to $0.65 per share, compared to actual second quarter fiscal 2003 diluted earnings per share of $0.62.
“For the balance of fiscal 2004, at Famous Footwear we expect our athletic business to remain healthy, especially with our introduction of new, exclusive athletic product for the back-to-school period. Plus, we have increased representation of key fashion/dress styles in our stores and in our wholesale lines for the fall season.
“However, we believe a conservative stance is prudent given the weakness in our Naturalizer stores, softening of our wholesale business, and traffic trends at Famous Footwear. In addition, we now anticipate slightly higher transition costs and softer sales volumes for Bass as we work to revitalize this great brand. As such, we currently expect fiscal 2004 diluted earnings per share in the range of $2.90 to $3.10, inclusive of Bass transition costs of $0.17 compared to actual fiscal 2003 diluted earnings per share of $2.52,” Fromm said.
