02 Sep Shoe Carnival’s Q2 Earnings Jump
Shoe Carnival Inc. reported earnings vaulted 86.4 percent in the second quarter, to $4.8 million, or 24 cents a share. Comparable store sales increased 0.5 percent, in-line with the company’s guidance.
Second Quarter Fiscal 2015 Highlights
- Net sales increased $5.7 million to $227.8 million, compared to $222.1 million in the second quarter of fiscal 2014
- Comparable store sales increased 0.5 percent, in-line with the company’s guidance
- Merchandise margin increased 1.1 percent, compared to the second quarter of fiscal 2014
- Earnings per diluted share increased 84.6 percent to $0.24, compared to $0.13 in the second quarter of fiscal 2014
Earnings came in ahead of Wall Street’s consensus estimate of 18 cents a share although revenues were slightly short of Wall Street’s average target of $228.9 million.
Cliff Sifford, president and CEO, stated, “We are pleased with our second quarter financial performance. Our strong quarterly earnings were driven by a combination of higher merchandise margins and lower advertising expenses. Comparable store sales were in-line with our expectations as the solid start to the quarter was muted by an anticipated shift in tax-free holidays to the third quarter of this year from the second quarter of fiscal 2014. We believe our assortment of branded, family footwear, favorable inventory position, and our multi-channel initiatives positioned us well to capture the robust back-to-school sales with our August comparable store sales up high single digits.”
Sifford concluded, “We recently hosted a major grand opening event in Philadelphia, PA, our latest large market. Also, we look forward to opening two complementary small market stores in the Midwest in the second half of fiscal 2015.”
Second Quarter Financial Results
The company reported net sales of $227.8 million for the second quarter of fiscal 2015, a 2.6 percent increase, as compared to net sales of $222.1 million for the second quarter of fiscal 2014. Comparable store sales increased 0.5 percent in the second quarter of fiscal 2015.
The gross profit margin for the second quarter of fiscal 2015 increased to 29.1 percent compared to 28.0 percent in the second quarter of fiscal 2014. The merchandise margin increased 1.1 percent while buying, distribution and occupancy expenses remained flat as a percentage of sales.
Selling, general and administrative expenses for the second quarter of fiscal 2015 increased $0.4 million to $58.4 million. As a percentage of net sales, these expenses decreased to 25.6 percent compared to 26.1 percent in the second quarter of fiscal 2014.
Net earnings for the second quarter of fiscal 2015 were $4.8 million, or $0.24 per diluted share. For the second quarter of fiscal 2014, the company reported net earnings of $2.6 million, or $0.13 per diluted share.
Six Month Financial Results
Net sales during the first six months of fiscal 2015 increased $22.8 million to $480.6 million as compared to the same period last year. Comparable store sales for the twenty-six week period ended August 1, 2015, increased 1.8 percent. Net earnings for the first six months of fiscal 2015 were $15.2 million, or $0.76 per diluted share, compared to net earnings of $11.7 million, or $0.58 per diluted share, in the first six months of fiscal 2014. The gross profit margin for the first six months of fiscal 2015 was 29.3 percent compared to 28.8 percent in the same period last year. Selling, general and administrative expenses, as a percentage of net sales, were 24.1 percent for the first six months of fiscal 2015 compared to 24.5 percent during the same period in fiscal 2014. The company opened 12 stores and closed 12 stores during the first six months of fiscal 2015 as compared to opening 23 stores and closing 1 store in the first six months of fiscal 2014.
Fiscal 2015 Earnings Outlook
The Company continues to expect fiscal 2015 net sales to be in the range of $977 million to $991 million, with a comparable store sales increase in the range of 1.5 percent to 3.0 percent. Earnings per diluted share for the fiscal year are expected to be in the range of $1.42 to $1.48. This represents an increase of 12 percent to 17 percent over fiscal 2014 earnings per diluted share of $1.27.
Store Growth
The company expects to open 21 new stores and close 15 stores in fiscal 2015. Store openings and closings by quarter for the fiscal year are as follows:
As of Sept. 1, 2015, the company operated 400 stores in 34 states and Puerto Rico.
