Caleres Reports Strong Q1 2024 Earnings

Caleres has reported its first quarter 2024 financial results, showing a mix of positive and challenging performance metrics. The company achieved $0.88 in earnings per share, surpassing expectations, and generated a record first quarter consolidated gross margin of 47 percent. However, net sales were down 0.5 percent from the first quarter of 2023, totaling $659.2 million.

The Famous Footwear segment saw net sales increase by 0.1 percent, with comparable sales down 2.3 percent. On the other hand, the Brand Portfolio segment experienced a decline in net sales by 2.6 percent. Direct-to-consumer sales represented approximately 69 percent of total net sales.

Gross profit was $309.1 million, with gross margin at 46.9 percent, marking an increase of 120 basis points versus the previous year. The Famous Footwear segment's gross margin reached 46.1 percent, up by 50 basis points, while the Brand Portfolio segment's gross margin increased by 240 basis points to 46.6 percent.

The company reported a net earnings of $30.9 million, or earnings per diluted share of $0.88, compared to $34.7 million and $0.97, respectively, in the first quarter of 2023. Earnings before interest, taxes, depreciation, and amortization (EBITDA) amounted to $57.4 million, representing 8.7 percent of sales.

Inventory was down by 5.2 percent from the first quarter of 2023 due to strategic inventory management, primarily in the Brand Portfolio segment. Additionally, borrowings under the asset-based revolving credit facility were $191.0 million at the end of the period, down about $100 million from the first quarter of 2023.

Looking ahead, Caleres reiterated its fiscal 2024 outlook, expecting consolidated net sales to be flat to up 2 percent compared to 2023, and earnings per diluted share to be in the range of $4.30 to $4.60. For the second quarter of 2024, the company anticipates consolidated net sales to be up 3 percent to 4 percent, with earnings per diluted share of $1.20 to $1.25.

In terms of capital allocation, Caleres repurchased 416,000 shares of common stock for $15.1 million and returned $2.4 million to shareholders through quarterly dividend payments during the quarter.

Caleres' performance demonstrates a mixture of successes and challenges, with strategic initiatives and investments driving certain positive outcomes while the company navigates a challenging consumer demand environment. Following these announcements, the company's shares moved -2.0%, and are now trading at a price of $35.96. If you want to know more, read the company's complete 8-K report here.

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