Shoe Carnival, Inc. expects second quarter earnings per share to range from breakeven to 5 cents per diluted share, assuming a comparable store sales decline ranging from 6% to 7%. This guidance is down from the 20 cents to 23 cents earnings per diluted share estimate given at the end of the first quarter. An estimated decline in comparable store sales of 3% to 4% is attributable to the shifting of back-to-school dates and certain states tax-free days later in August. This shift adversely affects second quarter sales and earnings but should benefit the third quarter results.

Speaking on the revised guidance for the quarter, Mark Lemond, chief executive officer and president said, “To date, our second quarter sales and earnings results have been significantly affected by a decline in customer traffic and the shifting of back-to-school dates and tax-free days later in August in certain markets, particularly in Florida and Texas. While sales to-date have fallen short of our original expectations for the second quarter, our merchandise team has been aggressively liquidating our spring and summer product. Per-store inventories at August 4, 2007 are expected to be flat compared with inventories as of August 5, 2006.”