Footwear retailer hits Q4 goals, surpasses $1 billion in sales

Highly promotional activity and increased multichannel initiatives not only helped Shoe Carnival hit its expectations, but exceed $1 billion in net sales for the year.



For the quarter ended January 28, 2017, the retailer’s net sales were $234.2 million, a 0.2% increase, compared to net sales of $233.7 million for the fourth quarter of fiscal 2015. While it was in line with its goals, this was just shy of Wall Street’s prediction for sales of $235 million.



The chain’s net sales increase was driven by sales of $5.0 million from 21 new stores opened since the beginning of the fourth quarter of fiscal 2015, Kerry Jackson, the company’s CFO, said during the retailer’s shareholder’s meeting.



“This net sales increase was partially offset by a $2.8 million decrease in comp store sales and a $1.7 million loss in sales from the 10 stores closed since the beginning of the fourth quarter of fiscal 2015,” she added.



Specifically, same-store sales decreased 1.2% in the fourth quarter, and gross profit margin decreased to 27.5% compared to 29.2% in the fourth quarter of fiscal 2015. The company also reported that it ended the year with its inventory down $13.2 million, a decrease of 6.8% compared to last year.



“Our comparable stores sales performance was in-line with the updated expectations we provided in January, and our gross profit margin came in better than we anticipated,” said Cliff Sifford, Shoe Carnival’s president and CEO. “Our team took decisive actions to promote our seasonal boot footwear to ensure we ended 2016 in a clean inventory position.”



For the year, net sales increased $17.1 million to $1.001 billion com-pared to $984.0 million in fiscal 2015. Comparable store sales increased 0.5%, and net earnings were $23.5 million, compared to $28.8 million in fiscal 2015.



The company said members of its Shoe Perks loyalty program contribut-ed to these gains, as these shoppers account for approximately 66% of the company’s net sales. “Shoe Perks [members] spend on average 19% more per transaction than non-members,” said Sifford.



The company expects fiscal 2017 net sales to be in the range of $1.028 billion to $1.040 billion, with comparable store sales flat to up low single digits. The chain also plans to enhance digital sales strategies, including a new mobile app expected to launch in the next few months, according to Sifford.