Brown Shoe Company Reports Third Quarter 2014 Results

Earnings per share up 19% year-over-year

Raising full-year EPS guidance range to $1.65 to $1.69

ST. LOUIS--()--Brown Shoe Company (NYSE: BWS) (brownshoe.com) today reported third quarter 2014 financial results, with net sales of $729.3 million up 3.8% versus third quarter 2013 net sales of $702.8 million. Third quarter 2014 net earnings of $33.1 million, or $0.75 per diluted share, were up 21.2% compared to net earnings of $27.3 million, or $0.63 per diluted share, in the third quarter of 2013. Gross margin for the third quarter of 2014 was 39.9% up 30 basis points compared to 39.6% in the prior year.

“Wholesale overachieved again, with sales up 18.2% in third quarter, and both Healthy Living and Contemporary Fashion contributed strong double-digit sales improvement. At Famous Footwear, our focus on big ideas for back-to-school continued to deliver. Same-store-sales were up 1.6%, for the 10 weeks that make up this key selling season,” said Diane Sullivan, CEO, president and chairman of Brown Shoe Company. “Although our biggest quarter of the year is past, with nine strong months behind us -- and an easier comp ahead of us for the fourth quarter -- we expect to deliver a strong 2014.”

                           
US$M, except per share (unaudited)     13 Weeks

3Q'14

    13 Weeks

3Q’13

   

3Q

              Change
Consolidated net sales     $ 729.3       $ 702.8       3.8 %
Famous Footwear     435.4       439.6       (1.0 )%
Wholesale Operations     242.6       205.3       18.2 %
Specialty Retail     51.3       57.9       (11.4 )%
Gross profit     290.7       278.2       4.5 %
Margin     39.9 %     39.6 %     30 bps
SG&A     237.5       233.5       1.7 %
% of net sales     32.6 %     33.2 %     (60 bps)
Operating earnings     53.2       44.7       19.1 %
Margin     7.3 %     6.4 %     90 bps
Net interest expense     5.1       5.2       (0.5 )%
Earnings from continuing operations before income taxes     48.1       39.5       21.7 %
Tax rate     30.9 %     31.6 %     (70 bps)
Net earnings from discontinued operations          

0.2

     

(100.0

)%

Net earnings     33.1       27.3       21.2 %
Per diluted share     $ 0.75       $ 0.63       19.0

%

 

Third Quarter Highlights

Famous Footwear third quarter 2014 sales of $435.4 million were down 1.0% year-over-year, with same-store-sales down 0.2%. For the back-to-school selling season, weeks 24 through 33, same-store-sales were up 1.6%. Performance in the quarter was driven by continued strong growth in canvas and aided by an increase in both sandals and boots. During the quarter, six stores were closed or relocated and 12 new stores were added.

Wholesale sales of $242.6 million were up 18.2% in the third quarter. For the Healthy Living platform, wholesale sales of $118.3 million were up 12.4%, while Contemporary Fashion wholesale sales of $124.1 million were up 24.4%.

Consolidated gross profit of $290.7 million was up 4.5% in the third quarter, while gross margin improved by 30 basis points to 39.9%. SG&A for the third quarter was $237.5 million, or 32.6% of net sales, which was down approximately 60 basis points versus the prior year. For the quarter, operating margins improved approximately 90 basis points year-over-year to 7.3%.

Inventory at the end of the third quarter was $567.8 million, up 4.3% from $544.6 million in the prior year. Famous Footwear inventory was down 1.2%, while Wholesale inventory was up 31.0%. At quarter-end, Brown Shoe Company had $14.0 million of borrowings against its revolving credit facility and $39.1 million of cash and equivalents. The company’s debt-to-capital ratio improved to 28.3% from 30.6% in the third quarter of 2013.

Financial Review and 2014 Outlook

“Thanks to strong wholesale results in the third quarter, along with steady performance at Famous Footwear, we are raising our full-year EPS guidance to $1.65 to $1.69,” said Russ Hammer, chief financial officer of Brown Shoe Company. “While we expect to end the year on a positive note, we remain aware of the promotional potential at retail for the holiday season and alert to possible shifts in consumer sentiment.”

         
Guidance Metric       FY’14
Consolidated net sales       $2.58 to $2.59 billion
Famous Footwear same-store sales Up low-single digits
Specialty Retail net sales Down high-single digits
Wholesale Operations net sales Up mid- to high-single digits
Gross margin Up approximately 10 bps
SG&A $920 to $925 million
Net interest expense $20 to $21 million
Effective tax rate 30% to 32%
Earnings per diluted share $1.65 to $1.69
Depreciation and amortization $51 to $53 million
Capital expenditures       $56 to $59 million
 

Investor Conference Call: Brown Shoe Company will webcast an investor conference call at 9:00 a.m. ET today, November 25, 2014. The webcast and slides will be available at investor.brownshoe.com/news/events. A live conference call will be available at (877) 217-9089 for analysts in North America or (706) 679-1723 for international analysts by using the conference ID 26708713. A replay will be available for a limited period at investor.brownshoe.com/news/events/archive. Investors may also access the replay by dialing (855) 859-2056 in North America or (404) 537-3406 internationally and using the conference ID 26708713 through Tuesday, December 2, 2014.

Definitions: All references in this press release, outside of the condensed consolidated financial statements that follow, unless otherwise noted, related to net earnings attributable to Brown Shoe Company, Inc. and diluted earnings per common share attributable to Brown Shoe Company, Inc. shareholders, are presented as net earnings and earnings per diluted share, respectively.

Non-GAAP Financial Measures: In this press release, the company’s financial results are provided both in accordance with generally accepted accounting principles (GAAP) and using certain non-GAAP financial measures. In particular, the company provides historic and estimated future gross profit, operating earnings, net earnings and earnings per diluted share adjusted to exclude certain gains, charges and recoveries, which are non-GAAP financial measures. These results are included as a complement to results provided in accordance with GAAP because management believes these non-GAAP financial measures help identify underlying trends in the company’s business and provide useful information to both management and investors by excluding certain items that may not be indicative of the company’s core operating results. These measures should not be considered a substitute for or superior to GAAP results. Reconciliations to the applicable GAAP financial measures have been included in the attached schedules.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: This press release contains certain forward-looking statements and expectations regarding the company’s future performance and the performance of its brands. Such statements are subject to various risks and uncertainties that could cause actual results to differ materially. These risks include (i) changing consumer demands, which may be influenced by consumers' disposable income, which in turn can be influenced by general economic conditions; (ii) rapidly changing fashion trends and purchasing patterns; (iii) intense competition within the footwear industry; (iv) the ability to accurately forecast sales and manage inventory levels; (v) political and economic conditions or other threats to the continued and uninterrupted flow of inventory from China and other countries, where the company relies heavily on third-party manufacturing facilities for a significant amount of its inventory; (vi) cybersecurity threats or other major disruption to the company’s information technology systems; (vii) customer concentration and increased consolidation in the retail industry; (viii) a disruption in the company’s distribution centers; (ix) foreign currency fluctuations; (x) additional duties, quotas, tariffs or other trade restrictions;(xi) compliance with applicable laws and standards with respect to labor, trade and product safety issues; (xii) the ability to recruit and retain senior management and other key associates; (xiii) the ability to attract, retain and maintain good relationships with licensors and protect intellectual property rights; (xiv) the ability to secure/exit leases on favorable terms; and (xv) the ability to maintain relationships with current suppliers. The company's reports to the Securities and Exchange Commission contain detailed information relating to such factors, including, without limitation, the information under the caption Risk Factors in Item 1A of the company’s Annual Report on Form 10-K for the year ended February 1, 2014, which information is incorporated by reference herein and updated by the company’s Quarterly Reports on Form 10-Q. The company does not undertake any obligation or plan to update these forward-looking statements, even though its situation may change.

About Brown Shoe Company: Brown Shoe Company is a $2.5 billion, global, footwear company whose shoes are worn by people of all ages, from all walks of life. Our products are available virtually everywhere - in the over 1,200 Famous Footwear and Naturalizer retail stores we operate, in hundreds of major department and specialty stores, on 14 branded ecommerce sites, and on many additional third-party retail websites. Through our broad range of products, we serve three key market segments. Our Family brands - Famous Footwear, Famous.com and shoes.com - are one-stop-shopping destinations for high quality, affordable styles for a family’s every occasion. Active people who want comfort, style and performance, can look to our Healthy Living brands - Naturalizer, Dr. Scholl's, LifeStride and Ryka. Our Contemporary Fashion brands - Sam Edelman, Franco Sarto, Vince, Via Spiga, Fergie Footwear and Carlos Santana - keep fashionistas in step with the latest trends. At Brown Shoe Company, we inspire people to feel good and live better... feet first!

 

SCHEDULE 1


BROWN SHOE COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

   
(Unaudited)     (Unaudited)
Thirteen Weeks Ended     Thirty-nine Weeks Ended
(Thousands, except per share data)  

November 1,
2014

 

November 2,
2013

   

November 1,
2014

 

November 2,
2013

Net sales $ 729,277   $ 702,788 $ 1,956,316   $ 1,913,150
Cost of goods sold   438,547     424,548     1,163,603     1,140,268  
Gross profit   290,730     278,240     792,713     772,882  
Selling and administrative expenses 237,517 233,572 679,472 678,522
Restructuring and other special charges, net 1,262
Impairment of assets held for sale               4,660  
Operating earnings   53,213     44,668     113,241     88,438  
Interest expense (5,207 )

(5,254

)

 

(15,637 ) (16,167 )
Interest income   109     132     294     282  
Earnings before income taxes from continuing operations   48,115     39,546     97,898     72,553  
Income tax provision   (14,878 )   (12,495

)

 

(31,146 )   (24,522 )
Net earnings from continuing operations   33,237     27,051     66,752     48,031  
Discontinued operations:
Earnings (loss) from discontinued operations, net of tax (expense) benefit of $0, ($114), $0 and $6,057, respectively 233 (4,784 )
Disposition/impairment of discontinued operations, net of tax of $0               (11,512 )
Net earnings (loss) from discontinued operations       233         (16,296 )
Net earnings   33,237     27,284     66,752     31,735  
Net earnings (loss) attributable to noncontrolling interests   124     (30

)

 

146     (174 )
Net earnings attributable to Brown Shoe Company, Inc.   $ 33,113     $ 27,314     $ 66,606     $ 31,909  
 
Basic earnings (loss) per common share:
From continuing operations $ 0.76 $ 0.63 $ 1.53 $ 1.12
From discontinued operations               (0.38 )
Basic earnings per common share attributable to Brown Shoe Company, Inc. shareholders   $ 0.76     $ 0.63     $ 1.53     $ 0.74  
 
Diluted earnings (loss) per common share:
From continuing operations $ 0.75 $ 0.62 $ 1.52 $ 1.11
From discontinued operations       0.01         (0.38 )
Diluted earnings per common share attributable to Brown Shoe Company, Inc. shareholders   $ 0.75     $ 0.63     $ 1.52     $ 0.73  
 
Basic number of shares 42,144 41,447 42,035 41,288
Diluted number of shares 42,328 41,766 42,245 41,571
 
 

SCHEDULE 2


BROWN SHOE COMPANY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

    (Unaudited)    
November 1, 2014     November 2, 2013     February 1, 2014
(Thousands)    
ASSETS
 
Cash and cash equivalents $ 39,080 $ 42,406 $ 82,546
Receivables, net 138,217 112,491 129,217
Inventories, net 567,777 544,589 547,531
Prepaid expenses and other current assets 37,845 52,234 33,136
Current assets - discontinued operations     181     119
Total current assets 782,919     751,901     792,549
 
Property and equipment, net 151,289 148,182 143,560
Goodwill and intangible assets, net 135,774 75,181 73,673
Other assets 139,878     111,647     139,621
Total assets $ 1,209,860     $ 1,086,911     $ 1,149,403
 
LIABILITIES AND EQUITY
 
Borrowings under revolving credit agreement $ 14,000 $ $ 7,000
Trade accounts payable 203,062 200,706 226,602
Other accrued expenses 172,077 151,142 152,545
Current liabilities - discontinued operations     2,110     708
Total current liabilities 389,139     353,958     386,855
 
Long-term debt 199,150 198,963 199,010
Deferred rent 37,571 37,548 38,593
Other liabilities 42,983     44,483     47,583
Total other liabilities 279,704     280,994     285,186
 
Total Brown Shoe Company, Inc. shareholders’ equity 540,254 451,301 476,699
Noncontrolling interests 763     658     663
Total equity 541,017     451,959     477,362
Total liabilities and equity $ 1,209,860     $ 1,086,911     $ 1,149,403
 
 

SCHEDULE 3


BROWN SHOE COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

    (Unaudited)
Thirty-nine Weeks Ended
(Thousands) November 1, 2014     November 2, 2013
OPERATING ACTIVITIES:    
Net earnings $ 66,752 $ 31,735
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization 38,545 41,114
Amortization of debt issuance costs and debt discount 1,885 1,885
Share-based compensation expense 4,568 4,066
Tax benefit related to share-based plans (2,482 ) (2,581 )
Loss on disposal of facilities and equipment 1,400 960
Impairment charges for facilities and equipment 1,248 1,072
Impairment of assets held for sale 4,660
Disposition/impairment of discontinued operations 11,512
Net loss on sale of subsidiaries 576
Deferred rent (1,022 ) 3,837
Provision for doubtful accounts 298 388
Changes in operating assets and liabilities, net of dispositions:
Receivables (9,328 ) (385 )
Inventories (20,241 ) (41,180 )
Prepaid expenses and other current and noncurrent assets (1,201 ) (6,748 )
Trade accounts payable (23,661 ) (12,933 )
Accrued expenses and other liabilities 14,376 23,848
Other, net (2,635 )     159  
Net cash provided by operating activities 68,502       61,985  
 
INVESTING ACTIVITIES:
Capital expenditures (40,380 ) (41,603 )
Acquisition of trademarks (65,065 )
Investment in nonconsolidated affiliate (7,000 )
Net proceeds from sale of subsidiaries       69,347  
Net cash (used for) provided by investing activities (112,445 )     27,744  
 
FINANCING ACTIVITIES:
Borrowings under revolving credit agreement 741,000 966,000
Repayments under revolving credit agreement (734,000 ) (1,071,000 )
Dividends paid (9,173 ) (9,073 )
Issuance of common stock under share-based plans, net 237 (2,406 )
Tax benefit related to share-based plans 2,482       2,581  
Net cash provided by (used for) financing activities 546       (113,898 )
Effect of exchange rate changes on cash and cash equivalents (69 )     (1,648 )
Decrease in cash and cash equivalents (43,466 ) (25,817 )
Cash and cash equivalents at beginning of period 82,546       68,223  
Cash and cash equivalents at end of period $ 39,080       $ 42,406  
 

SCHEDULE 4


BROWN SHOE COMPANY, INC.
RECONCILIATION OF NET EARNINGS AND DILUTED EARNINGS PER SHARE (GAAP BASIS) TO ADJUSTED NET EARNINGS
AND ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP BASIS)

             
(Unaudited)   (Unaudited)
Thirteen Weeks Ended November 1, 2014   Thirteen Weeks Ended November 2, 2013
(Thousands, except per share data)

Pre-Tax Impact
of
Charges/Other
Items

 

Net Earnings
Attributable to
Brown Shoe
Company, Inc.

 

Diluted
Earnings Per
Share

 

Pre-Tax Impact
of
Charges/Other
Items

 

Net Earnings
Attributable to
Brown Shoe
Company, Inc.

 

Diluted Earnings
Per Share

 
GAAP earnings $ 33,113 $ 0.75 $ 27,314 $ 0.63
 

Charges/Other Items - Continuing Operations:

Portfolio realignment
Business exits and cost reductions                  
Total Continuing Operations
 

Charges/Other Items - Discontinued Operations:

Portfolio realignment
Business exits and cost reductions                  
Total Discontinued Operations                  
Total charges/other items $           $     $     $
Adjusted earnings $ 33,113     $ 0.75   $ 27,314     $ 0.63
 
(Unaudited)   (Unaudited)
Thirty-nine Weeks Ended November 1, 2014   Thirty-nine Weeks Ended November 2, 2013
(Thousands, except per share data)

Pre-Tax Impact
of Charges/Other
Items

 

Net Earnings
Attributable to
Brown Shoe
Company, Inc.

 

Diluted
Earnings Per
Share

 

Pre-Tax Impact
of
Charges/Other
Items

 

Net Earnings
Attributable to
Brown Shoe
Company, Inc.

 

Diluted Earnings
Per Share

GAAP earnings $ 66,606 $ 1.52 $ 31,909 $ 0.73
 

Charges/Other Items - Continuing Operations:

Portfolio realignment
Business exits and cost reductions $ $ 1,262 803 0.02
Non-cash impairments/dispositions           4,660     4,660     0.11
Total Continuing Operations 5,922 5,463 0.13
 

Charges/Other Items - Discontinued Operations:

Portfolio realignment
Business exits and cost reductions 13,233 6,414 0.13
Non-cash impairments/dispositions           11,512     11,512     0.28
Total Discontinued Operations           24,745     17,926     0.41
Total charges/other items $           $ 30,667     23,389     0.54
Adjusted earnings $ 66,606     $ 1.52   $ 55,298     $ 1.27
 

SCHEDULE 5


BROWN SHOE COMPANY, INC.
SUMMARY FINANCIAL RESULTS BY SEGMENT

(Unaudited)
                                                     
SUMMARY FINANCIAL RESULTS
                                                                               
Thirteen Weeks Ended
Famous Footwear     Wholesale Operations     Specialty Retail     Other     Consolidated
(Thousands)

November 1,
2014

   

November 2,
2013

   

November 1,
2014

   

November 2,
2013

   

November 1,
2014

   

November 2,
2013

   

November 1,
2014

   

November 2,
2013

   

November 1,
2014

   

November 2,
2013

Net Sales $ 435,380     $ 439,605     $ 242,562 $ 205,269 $ 51,335 $ 57,914 $ $ $ 729,277 $ 702,788
Gross Profit $ 188,858 $ 187,286 $ 79,803 $ 65,177 $ 22,069 $ 25,777 $ $ $ 290,730 $ 278,240
Adjusted Gross Profit $ 188,858 $ 187,286 $ 79,803 $ 65,177 $ 22,069 $ 25,777 $ $ $ 290,730 $ 278,240
Gross Profit Rate 43.4 % 42.6 % 32.9 % 31.8 % 43.0 % 44.5 % % % 39.9 % 39.6 %
Adjusted Gross Profit Rate 43.4 % 42.6 % 32.9 % 31.8 % 43.0 % 44.5 % % % 39.9 % 39.6 %
Operating earnings (loss) $ 37,554 $ 37,047 $ 27,848 $ 16,782 $ (355 ) $ 221 $ (11,834 ) $ (9,382 ) $ 53,213 $ 44,668
Adjusted Operating Earnings (Loss) $ 37,554 $ 37,047 $ 27,848 $ 16,782 $ (355 ) $ 221 $ (11,834 ) $ (9,382 ) $ 53,213 $ 44,668
Operating Earnings (Loss) % 8.6 % 8.4 % 11.5 % 8.2 % (0.7 )% 0.4 % % % 7.3 % 6.4 %
Adjusted Operating Earnings (Loss) % 8.6 % 8.4 % 11.5 % 8.2 % (0.7 )% 0.4 % % % 7.3 % 6.4 %
Same-store Sales % (on a 13-week basis) (0.2 )% 4.9 % % % (6.9 )% 0.6 % % % % %
Number of Stores 1,041 1,048 172 185 1,213 1,233
                                 
RECONCILIATION OF ADJUSTED RESULTS (NON-GAAP)
                                                                           
Thirteen Weeks Ended
Famous Footwear     Wholesale Operations     Specialty Retail     Other     Consolidated
(Thousands)

November 1,
2014

   

November 2,
2013

   

November 1,
2014

   

November 2,
2013

   

November 1,
2014

   

November 2,
2013

   

November 1,
2014

   

November 2,
2013

   

November 1,
2014

   

November 2,
2013

Gross Profit $ 188,858 $ 187,286 $ 79,803 $ 65,177 $ 22,069 $ 25,777 $ $ $ 290,730 $ 278,240

Charges/Other Items:

Portfolio realignment
Business exits and cost reductions                                                        
Total charges/other items                                                        
Adjusted Gross Profit $ 188,858       $ 187,286       $ 79,803       $ 65,177       $ 22,069       $ 25,777       $       $       $ 290,730       $ 278,240  
Operating earnings (loss) $ 37,554 $ 37,047 $ 27,848 $ 16,782 $ (355 ) $ 221 $ (11,834 ) $ (9,382 ) $ 53,213 $ 44,668

Charges/Other Items:

Portfolio realignment
Business exits and cost reductions                                                        
Total charges/other items                                                        

Adjusted Operating Earnings (Loss)

$ 37,554       $ 37,047       $ 27,848       $ 16,782       $ (355 )     $ 221       $ (11,834 )     $ (9,382 )     $ 53,213       $ 44,668  
 
 

SCHEDULE 5 - CONTINUED


BROWN SHOE COMPANY, INC.
SUMMARY FINANCIAL RESULTS BY SEGMENT

(Unaudited)
                                   
SUMMARY FINANCIAL RESULTS
                                                             
Thirty-nine Weeks Ended
Famous Footwear   Wholesale Operations   Specialty Retail   Other   Consolidated
(Thousands)

November 1,
2014

 

November 2,
2013

 

November 1,
2014

 

November 2,
2013

 

November 1,
2014

 

November 2,
2013

 

November 1,
2014

 

November 2,
2013

 

November 1,
2014

 

November 2,
2013

Net Sales $ 1,183,633   $ 1,180,143   $ 628,616 $ 567,334 $ 144,067 $ 165,673 $ $ $ 1,956,316 $ 1,913,150
Gross Profit $ 528,286 $ 523,022 $ 205,103 $ 178,859 $ 59,324 $ 71,001 $ $ $ 792,713 $ 772,882
Adjusted Gross Profit $ 528,286 $ 523,022 $ 205,103 $ 178,859 $ 59,324 $ 71,001 $ $ $ 792,713 $ 772,882
Gross Profit Rate 44.6 % 44.3 % 32.6 % 31.5 % 41.2 % 42.9 % % % 40.5 % 40.4 %
Adjusted Gross Profit Rate 44.6 % 44.3 % 32.6 % 31.5 % 41.2 % 42.9 % % % 40.5 % 40.4 %
Operating Earnings (Loss) $ 91,983 $ 95,057 $ 60,851 $ 28,085 $ (6,833 ) $ (2,934 ) $ (32,760 ) $ (31,770 ) $ 113,241 $ 88,438
Adjusted Operating Earnings (Loss) $ 91,983 $ 95,057 $ 60,851 $ 33,991 $ (6,833 ) $ (2,934 ) $ (32,760 ) $ (31,754

)

$ 113,241 $ 94,360
Operating Earnings (Loss) % 7.8 % 8.1 % 9.7 % 5.0 % (4.7 )% (1.8 )% % % 5.8 % 4.6 %
Adjusted Operating Earnings (Loss) % 7.8 % 8.1 % 9.7 % 6.0 % (4.7 )% (1.8 )% % % 5.8 % 4.9 %
Same-store Sales % (on a 39-week basis) 0.8 % 4.3 % % % (3.5 )% 1.7 % % % % %
Number of Stores 1,041 1,048 172 185 1,213 1,233
                           
RECONCILIATION OF ADJUSTED RESULTS (NON-GAAP)
                                                         
Thirty-nine Weeks Ended
Famous Footwear   Wholesale Operations   Specialty Retail   Other   Consolidated
(Thousands)

November 1,
2014

 

November 2,
2013

 

November 1,
2014

 

November 2,
2013

 

November 1,
2014

 

November 2,
2013

 

November 1,
2014

 

November 2,
2013

 

November 1,
2014

 

November 2,
2013

Gross Profit $ 528,286 $ 523,022 $ 205,103 $ 178,859 $ 59,324 $ 71,001 $ $ $ 792,713 $ 772,882

Charges/Other Items:

Portfolio realignment
Business exits and cost reductions                                      
Total charges/other items                                      
Adjusted Gross Profit $ 528,286     $ 523,022     $ 205,103     $ 178,859     $ 59,324     $ 71,001     $     $     $ 792,713     $ 772,882  
Operating Earnings (Loss) $ 91,983 $ 95,057 $ 60,851 $ 28,085 $ (6,833 ) $ (2,934 ) $ (32,760 ) $ (31,770 ) $ 113,241 $ 88,438

Charges/Other Items:

Portfolio realignment
Non-cash impairments/dispositions 4,660 4,660
Business exits and cost reductions             1,246                 16         1,262  
Total charges/other items             5,906                 16         5,922  
Adjusted Operating Earnings (Loss) $ 91,983     $ 95,057     $ 60,851     $ 33,991     $ (6,833 )   $ (2,934 )   $ (32,760 )   $ (31,754 )   $ 113,241     $ 94,360  
 
 

SCHEDULE 6


BROWN SHOE COMPANY, INC.
BASIC AND DILUTED EARNINGS (LOSS) PER SHARE RECONCILIATION

         
(Unaudited)   (Unaudited)
Thirteen Weeks Ended   Thirty-nine Weeks Ended
(Thousands, except per share data)

November 1,
2014

 

November 2,
2013

 

November 1,
2014

 

November 2,
2013

 
Net earnings attributable to Brown Shoe Company, Inc.:
Net earnings from continuing operations $ 33,237 $ 27,051 $ 66,752 $ 48,031
Net (earnings) loss attributable to noncontrolling interests (124 ) 30 (146 ) 174
Net earnings allocated to participating securities     (1,208 )   (1,097 )   (2,486 )   (2,098 )
Net earnings from continuing operations     31,905     25,984     64,120     46,107  
Net earnings (loss) from discontinued operations 233 (16,296 )
Net (earnings) loss allocated to participating securities         (9 )       712  
Net earnings (loss) from discontinued operations         224         (15,584 )
Net earnings attributable to Brown Shoe Company, Inc. after allocation of earnings to participating securities     $ 31,905     $ 26,208     $ 64,120     $ 30,523  
 
Basic and diluted common shares attributable to Brown Shoe Company, Inc.:
Basic common shares for continuing operations and discontinued operations 42,144 41,447 42,035 41,288
Dilutive effect of share-based awards for continuing operations and discontinued operations     184     319     210     283  
Diluted common shares for continuing operations and discontinued operations attributable to Brown Shoe Company, Inc.     42,328     41,766     42,245     41,571  
 
Basic earnings (loss) per common share:
From continuing operations $ 0.76 $ 0.63 $ 1.53 $ 1.12
From discontinued operations                 (0.38 )
Basic earnings per common share attributable to Brown Shoe Company, Inc. shareholders     $ 0.76     $ 0.63     $ 1.53     $ 0.74  
 
Diluted earnings (loss) per common share:
From continuing operations $ 0.75 $ 0.62 $ 1.52 $ 1.11
From discontinued operations         0.01         (0.38 )
Diluted earnings per common share attributable to Brown Shoe Company, Inc. shareholders     $ 0.75     $ 0.63     $ 1.52     $ 0.73  
 

SCHEDULE 7


BROWN SHOE COMPANY, INC.
BASIC AND DILUTED ADJUSTED EARNINGS PER SHARE RECONCILIATION

     
(Unaudited)   (Unaudited)
Thirteen Weeks Ended   Thirty-nine Weeks Ended
(Thousands, except per share data)

November 1,
2014

 

November 2,
2013

 

November 1,
2014

 

November 2,
2013

 
Adjusted net earnings attributable to Brown Shoe Company, Inc.:
Adjusted net earnings from continuing operations $ 33,237 $ 27,051 $ 66,752 $ 53,493
Net (earnings) loss attributable to noncontrolling interests (124 ) 30 (146 ) 174
Net earnings allocated to participating securities (1,208 )   (1,097 )   (2,486 )   (2,336 )
Adjusted net earnings from continuing operations 31,905     25,984     64,120     51,331  
Adjusted net earnings from discontinued operations 233 1,630
Net earnings allocated to participating securities     (9 )       (71 )
Net earnings from discontinued operations     224         1,559  
Adjusted net earnings attributable to Brown Shoe Company, Inc. after allocation of earnings to participating securities $ 31,905     $ 26,208     $ 64,120     $ 52,890  
 
Basic and diluted common shares attributable to Brown Shoe Company, Inc.:
Basic common shares for continuing operations and discontinued operations 42,144 41,447 42,035 41,288
Dilutive effect of share-based awards for continuing operations and discontinued operations 184     319     210     283  
Diluted common shares for continuing operations and discontinued operations attributable to Brown Shoe Company, Inc. 42,328     41,766     42,245     41,571  
 
Basic adjusted earnings per common share:
From continuing operations $ 0.76 $ 0.63 $ 1.53 $ 1.24
From discontinued operations             0.04  
Basic adjusted earnings per common share attributable to Brown Shoe Company, Inc. shareholders $ 0.76     $ 0.63     $ 1.53     $ 1.28  
 
Diluted adjusted earnings per common share:
From continuing operations $ 0.75 $ 0.62 $ 1.52 $ 1.23
From discontinued operations     0.01         0.04  
Diluted adjusted earnings per common share attributable to Brown Shoe Company, Inc. shareholders $ 0.75     $ 0.63     $ 1.52     $ 1.27  

Contacts

Brown Shoe Company
Peggy Reilly Tharp, 314-854-4134
ptharp@brownshoe.com

Contacts

Brown Shoe Company
Peggy Reilly Tharp, 314-854-4134
ptharp@brownshoe.com