Caleres (NYSE:CAL), a leader in consumer-driven footwear brands, has unveiled its financial results for the third quarter of fiscal 2024.
Key Financial Metrics:
| Financial Metric | Q3 2024 | Q3 2023 | Year-Over-Year Change |
|---|---|---|---|
| Total Revenue | $740.9M | - | -2.8% |
| Earnings per Diluted Share | $1.19 | $1.32 | -9.8% |
- Interpretation : Caleres reported a slight decline in revenue, totaling $740.9 million, marking a 2.8% decline year-over-year. The earnings per diluted share dropped to $1.19 from $1.32 in the same quarter last year, falling short of analyst expectations.
Revenue Performance by Segment:
| Segment | Q3 2024 Revenue Change |
|---|---|
| Famous Footwear | -4.8% |
| Brand Portfolio | +0.7% |
- Interpretation : The Brand Portfolio exhibited modest growth compared to Q3 2023, increasing by 0.7%. In contrast, Famous Footwear experienced a 4.8% decline, although comparable store sales rose by 2.5%.
Key Developments and Operational Highlights:
- Third quarter gross margin fell by 55 basis points to 44.1%.
- EBITDA reached $71.4 million for the quarter.
- Direct-to-consumer sales accounted for approximately 72% of total net sales.
- Inventory levels rose by 5% year-over-year, with a slight timing adjustment accounting for the retail calendar shift.
Comments from Company Officers:
Jay Schmidt, President and CEO, noted the company’s strategic progression with the Brand Portfolio achieving growth, and Famous Footwear increasing its market share. Nevertheless, he acknowledged the challenges posed by softer seasonal demand, delayed key product arrivals, and disruptions in China, which adversely affected performance.
Share Repurchase and Dividends:
- During the quarter, Caleres repurchased approximately 1.5 million shares for $50 million. Ongoing efforts emphasize debt reduction with expectations to lower the asset-based revolving credit facility borrowings below $100 million by the end of 2026.
Forward Guidance:
Caleres has revised its fiscal 2024 guidance due to expected continuity of current sales trends and gross margin pressures as inventory management actions are underway. Earnings per diluted share is now forecasted to be between $3.35 and $3.45, down from the prior guidance of $3.94 to $4.09.
In summary, Caleres is navigating a challenging quarter with mixed results across its segments, leading to adjusted financial guidance as it looks optimistically towards strategic realignment and debt reduction in the near term.
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