EVANSVILLE, Ind., March 9 /PRNewswire/ -- Shoe Carnival, Inc.
(Nasdaq: SCVL) a leading retailer of value-priced footwear and accessories,
today announced record net earnings of $10.2 million, or $.76 per share on a
diluted basis, for the 1998 fiscal year which ended January 30, 1999. This
represents a 38.4 percent increase over net earnings of $7.4 million, or $.56
per share on a diluted basis, for fiscal 1997. Net sales for the 1998 fiscal
year increased 13.6 percent to $280.2 million from sales of $246.5 million for
the 1997 fiscal year. Comparable store sales increased 3.6 percent for the
fifty-two week period.
Net earnings for the fourth quarter of 1998 increased 28.8 percent to
$670,000, or $.05 per share on a diluted basis, from net earnings of
$520,000, or $.04 per share on a diluted basis, in the fourth quarter of 1997.
Net sales for the fourth quarter increased 19.6 percent to $69.9 million from
$58.4 million last year. Comparable store sales increased 2 percent for the
thirteen-week period.
Commenting on the results, Mark Lemond, president and chief executive
officer, said, "1998 continued our record setting performance in both sales
and net income. We have now recorded 10 consecutive quarters of comparable
store sales increases and 12 consecutive quarters of significant increases in
net income on a year-over-year basis."
Other highlights for the year include:
-- The operating margin improved significantly, rising to 6.3 percent of
sales in 1998 from 5.3 percent in 1997. The increase resulted from the
combination of better gross profit margins and leveraged selling,
general and administrative (SG&A) expenses.
-- Gross profit margins rose to 30 percent in 1998 from 29.4 percent in
1997.
-- SG&A expenses declined to 23.7 percent of sales in 1998 from 24.1
percent last year due to solid expense controls and the ability to
leverage administrative costs against a higher sales base.
-- Cash generated from operating activities was $18.6 million. Long-term
debt was reduced by $4.8 million, resulting in a long-term debt to
total capital ratio of less than 2 percent at year-end. Long-term debt
consisted only of capital lease obligations, as there were no cash
advances outstanding under the Company's bank line of credit at
year-end. Accordingly, interest costs declined by $405,000 for the
year.
-- Twenty new stores were opened, five stores were expanded and one store
was closed for a net addition of 253,000 square feet of retail space.
We ended the year with 111 stores and 1.3 million square feet.
-- The reorganization of the merchandise planning group was completed,
including the installation of data warehouse technology and the
Auther(TM) Planning system.
-- Key personnel changes were made recently in our marketing,
merchandising and operational groups, significantly strengthening each
and providing the framework for further store expansion.
-- Key brands added to the merchandise mix included the Aerosole's What's
What line, Timberland, the Liz Claiborne Villager line, Nicole,
Madeline Stuart, Teva, Birkenstock, Mia and Airwalk.
-- The branded image within the stores was improved with enhanced visual
merchandising techniques.
Mr. Lemond continued, "At the end of last year, I stated that we were
focused on two primary goals, accelerating our store growth and improving the
operating margin. We accomplished both. While we will continue to focus on
improving the operating margin through gross margin enhancements and
leveraging of the expense structure, it is anticipated that future earnings
growth will result primarily from new store expansion. In 1999 we will
accelerate our store expansion with the opening of between 25 and 30 stores.
"We enter 1999 with a good inventory position, a strengthened management
team and a solid financial position. We are confident we have built a solid
platform to profitably accelerate the expansion of Shoe Carnival in 1999."
This press release contains certain forward looking statements that
involve a number of risks and uncertainties. Among the factors that could
cause actual results to differ materially are the following: general economic
conditions in the areas of the United States in which the Company's stores are
located; changes in the overall retail environment and more specifically in
the apparel and footwear retail sectors; the impact of competition, weather
patterns, consumer buying trends and the ability of the Company to identify
and respond to emerging fashion trends; the availability of desirable store
locations and management's ability to negotiate acceptable lease terms and
open new stores in a timely manner; and changes in the political and economic
environments in the People's Republic of China and Brazil, where most of the
Company's products are manufactured, and the continued favorable trade
relationships between those countries and the United States.
Shoe Carnival is a chain of 111 footwear stores located in the Midwest and
mid-South. Combining value pricing with an entertaining store format, Shoe
Carnival is a leading retailer of name brand and private label footwear for
the entire family. Headquartered in Evansville, Ind., Shoe Carnival trades on
the Nasdaq Stock Market under the symbol SCVL. Shoe Carnival's press releases
and 1997 annual report are available on the Company's website at
http://www.shoecarnival.com/.
SHOE CARNIVAL, INC.
CONDENSED STATEMENTS OF INCOME
(In thousands, except per share)
(Unaudited)
13 Weeks Ended 52 Weeks Ended
Jan. 30, Jan. 31, Jan. 30, Jan. 31,
1999 1998 1999 1998
Net sales $69,917 $58,435 $280,157 $246,520
Cost of sales (including
buying, distribution
and occupancy costs) 51,342 42,810 196,141 173,953
Gross profit 18,575 15,625 84,016 72,567
Selling, general and
administrative expenses17,337 14,636 66,464 59,438
Operating income 1,238 989 17,552 13,129
Interest expense 121 187 507 912
Income before
income taxes 1,117 802 17,045 12,217
Income taxes 447 282 6,818 4,826
Net income $670 $520 $10,227 $7,391
Net income per
share - Basic $0.05 $0.04 $0.78 $0.57
Net income per
share - Diluted $0.05 $0.04 $0.76 $0.56
Weighted average
common shares
outstanding-Basic 13,175 13,071 13,150 13,049
Weighted average
common shares
outstanding - Diluted 13,420 13,282 13,429 13,238
SHOE CARNIVAL, INC.
CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
ASSETS
January 30, January 31,
1999 1998
Current Assets:
Cash and cash equivalents $1,944 $1,571
Accounts receivable 567 803
Merchandise inventories 75,390 60,091
Deferred income tax benefit 782 933
Other 1,222 834
Total Current Assets 79,905 64,232
Property and equipment-net 40,856 31,969
TOTAL ASSETS $120,761 $96,201
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $25,698 $10,168
Accrued and other liabilities 5,757 4,487
Current portion of long-term debt 782 688
Total Current Liabilities 32,237 15,343
Long-term debt 1,361 6,133
Deferred lease incentives 2,424 1,308
Deferred income taxes 2,072 1,808
TOTAL LIABILITIES 38,094 24,592
SHAREHOLDERS' EQUITY 82,667 71,609
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $120,761 $96,201
SOURCE Shoe Carnival, Inc.
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Related links:
http://www.shoecarnival.com
CONTACT:
Mark L. Lemond, President and Chief Executive
Officer, or W. Kerry Jackson, Vice President, Chief Financial
Officer and Treasurer, of Shoe Carnival, Inc., 812-867-4034
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