Caleres reports mixed first quarter results amid difficult consumer demand environment By Investing.com

castle. LOUIS – Caleres (NYSE: NYSE:), a diversified portfolio of global footwear brands, reported first-quarter earnings that topped Wall Street expectations, but revenue was down slightly.

The company reported first-quarter adjusted earnings per share (EPS) of $0.88, slightly above analyst estimates of $0.87. However, the company had revenue of $659.2 million for the quarter, compared to consensus estimates of $665.5 million.

The company achieved a record first quarter consolidated gross margin of 47%, a notable increase over the previous year. Despite a challenging consumer demand environment, Caleres achieved increased sales and profitability of its lead brands and strong margin performance across its brand portfolio.

The Brand Portfolio segment generated more than half of the company’s operating profit during the quarter and had an operating margin of 13%. Famous Footwear maintained year-over-year sales levels and generated solid gross margins, with significant sales and market share growth in the kids category.

President and CEO Jay Schmidt expressed confidence in the company’s ability to deliver earnings per share within the guidance provided for fiscal 2024. Schmidt emphasized the company’s strategic positioning and investments in growth initiatives that are expected to create ongoing value for shareholders.

Looking ahead to fiscal 2024, Caleres restated its financial outlook, projecting consolidated net sales to increase 2% year over year and adjusted EPS in the range of $4.30 to $4.60. For the second quarter of 2024, the company expects consolidated net sales to increase 3% to 4%, which includes a $20 million to $25 million benefit to Famous Footwear due to schedule changes during key back-to-school weeks. Adjusted EPS for the second quarter is expected to be between $1.20 and $1.25.

Caleres also emphasized strategic inventory management, which resulted in a 5.2% decrease in inventory compared to the first quarter of the previous year. Additionally, the company continued to invest in value-creating opportunities and returned cash to shareholders through share buybacks and dividends.

In the near term, the company’s capital allocation strategy continues to focus on reducing debt, with borrowings under its asset-based revolving credit facility expected to be less than $100 million by 2026. Caleres will continue to evaluate free cash flow opportunities throughout the year. Considering business performance and market conditions

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