Caleres Cuts FY24 Earnings View Below Market After Weak Q3; Stock Plunges - Update

Brown Shoe Company

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(RTTNews) - Shares of Caleres Inc. (CAL) were losing around 16 percent in the pre-market activity on the NYSE after the footwear company on Thursday trimmed its fiscal 2024 earnings view below market, after reporting weak results in its third quarter.

Jay Schmidt, President and Chief Executive Officer, said, "... performance was below our expectations reflecting softer seasonal demand in the boot category, late receipts of key athletic product at Famous Footwear, and a discrete customer credit issue that impacted shipments. In addition, our business in China was also weaker than planned."

For fiscal 2024, the company now expects earnings per share in the range of $3.35 to $3.45, lower than prior guidance of $3.94 to $4.09.

Adjusted earnings per share would be $3.45 to $3.55, compared to previous estimate of $4.00 to $4.15.

Analysts on average expect the company to report earnings of $4.03 per share, according to figures compiled by Thomson Reuters. Analysts' estimates typically exclude special items.

For the year, net sales are now expected to be down 2.5 percent to 3 percent, compared to previous guidance of down low-single-digits percent.

The company said the outlook was reduced as it expects season-to-date sales trend to continue in the final quarter of the year and anticipate pressure on gross margin as the firm takes action to move through excess inventory and position itself well for 2025.

In its third quarter, Caleres' profit decreased from last year and missed the Street estimates.

Caleres' bottom line came in at $41.43 million, or $1.19 per share. This compares with $46.91 million, or $1.32 per share, in last year's third quarter.

Adjusted earnings were $42.61 million or $1.23 per share for the period. Analysts had expected the company to earn $1.36 per share.

The company's revenue for the quarter fell 2.8 percent to $740.94 million from $761.90 million last year.

Footwear sales declined 4.8 percent with comparable store sales up 2.5 percent. Brand Portfolio sales increased 0.7 percent.

In pre-market activity on the NYSE, Caleres shares were trading $27.98, down 15.72 percent.

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