Shoe Carnival, Inc. reported sales for the first quarter increased 13.3% to $189.5 million from $167.3 million a year ago. Comparable store sales increased 13.1%. Net earnings jumped 124% to $9.2 million, or 72 cents a share, from $4.1 million, or 33 cents, a year ago.
The gross profit margin for the first quarter of fiscal 2010 increased to 31.3% compared to 27.9% for the first quarter of fiscal 2009. The merchandise margin increased 2.2% due to significantly reduced promotional activity combined with strong sales of athletic and toning footwear compared to the prior year. The company's buying, distribution and occupancy costs decreased 1.2%, as a percentage of sales, due to the strong sales results.
Selling, general and administrative expenses for the first quarter of fiscal 2010 increased $4.2 million to $44.3 million, primarily as a result of increases in incentive compensation associated with the company's improved financial performance. As a percentage of sales, these expenses decreased to 23.4% compared to 24.0% in the first quarter of fiscal 2009.
Speaking on the results, Mark Lemond, president and chief executive officer said, “I am pleased to report we were able to take advantage of consumer demand resulting in a sales increase in each broad merchandise category. While toning and athletic footwear were key drivers of our sales in the quarter, our non-athletic footwear contributed approximately half of our comparable store sales increase. The record quarterly comparable store sales increase, combined with a higher gross profit margin and controlled expenses enabled us to report the strongest quarterly earnings in the company's history.”
Lemond continued, “Our continued strong financial performance gives us the confidence to remain optimistic about our outlook for the summer and back-to-school season. We will continue to manage the controllable aspects of our business for long-term growth and free cash flow generation.”
Second Quarter Fiscal 2010 Earnings Outlook
The company expects second quarter net sales to be in the range of $165 to $168 million and comparable store sales to increase in the range of 8 to 10 percent. Earnings per diluted share in the second quarter of fiscal 2010 are expected to be in the range of 23 cents to 27 cents. Earnings per diluted share in the second quarter of fiscal 2009 were 8 cents a share.
The Company expects to open 10 new stores
and close seven stores in
fiscal 2010. Three new stores were opened during the first quarter
2010 and three stores were closed.