EVANSVILLE, Ind., Nov. 21 /PRNewswire-FirstCall/ -- Shoe Carnival, Inc.
(Nasdaq: SCVL) a leading retailer of value-priced footwear and accessories,
today announced record sales and earnings for the third quarter ended November
2, 2002. Net earnings in the third quarter of fiscal 2002 increased to
$4.96 million compared with $4.63 million in the third quarter of fiscal 2001.
Earnings per share on a diluted basis increased to $.38 per share from
$.37 per share in last year's third quarter.
Net sales for the third quarter increased 10 percent to an all-time
Company record of $137.7 million from $124.8 million last year. Comparable
store sales increased 1.3 percent for the 13-week period.
Gross profit margin for the third quarter was 29.4 percent compared to
29.5 percent last year. Selling, general and administrative expenses, as a
percentage of sales, increased to 23.5 percent from 23.2 percent in the third
quarter of 2001. New store pre-opening costs incurred in the third quarter of
2002 were $870,000, or 0.6 percent of sales, compared with $342,000, or 0.3
percent of sales last year.
Interest costs decreased to $161,000 in the third quarter from $480,000
last year due to a significant reduction in average borrowings and a lower
effective interest rate. Long-term debt of $25.4 million was outstanding at
the end of the third quarter of 2002 compared with $41.2 of long-term debt
outstanding at the end of the third quarter last year.
Net earnings increased 24 percent for the first nine months of 2002 to
$14.17 million, or $1.09 per share on a diluted basis, from net earnings of
$11.42 million, or $.92 per share on a diluted basis, last year. Net sales
increased 10 percent to $391.7 million for the first nine months from sales of
$356 million last year. Comparable store sales increased 0.7 percent for the
nine-month period. The gross profit margin for the first nine months of 2002
was 29.4 percent compared with 29.2 percent for the first nine months last
year. Selling, general and administrative expenses, as a percentage of sales,
decreased to 23.5 percent for the first nine months of 2002 from 23.6 percent
for the first nine months of 2001. New store pre-opening costs for the first
nine months of 2002 were $2.0 million, or 0.5 percent of sales, compared with
$1.2 million, or 0.3 percent of sales last year. Interest expense incurred in
the first nine months of 2002 decreased to $625,000 from $1.9 million in the
same period in 2001.
Mark Lemond, president and chief executive officer stated, "Due to a much
improved sales performance in October, net earnings of $.38 per share were
significantly better than our recent expectations of between $.32 and $.34 per
share. Though we experienced somewhat erratic consumer shopping patterns
during the quarter, our sales and net earnings for the third quarter are the
highest achieved in any third quarter in the Company's history. In fact, our
third quarter net earnings of $4.96 million are the second highest earnings in
any quarter, trailing only the record results in the first quarter of this
year.
"For the first three quarters, net earnings have increased 24 percent on a
10 percent increase in sales. We have achieved a higher operating margin in
what has been a continued difficult retail environment this year. Despite a
small decline in the third quarter, gross profit margins on a year-to-date
basis have increased while we have lowered store inventory levels.
Additionally, while pre-opening costs associated with the accelerated store
expansion have increased, we have been able to decrease total SG&A expenses as
a percentage of sales.
"We have significantly strengthened our balance sheet during the past four
quarters, in part by turning inventory faster and utilizing cash flow to pay
down debt. On a per-store basis, our inventories at the end of the quarter
were 5 percent lower than at the end of the third quarter last year. We have
reduced long-term debt by almost $16 million during the last four quarters
even though we accelerated our store growth in 2002. Our long-term debt to
total capital now stands at 16.5 percent. The strength of our balance sheet
will support a continued acceleration of store growth in 2003."
The Company completed the store openings for the year with the opening of
10 stores in the third quarter. Twenty-five stores were opened during fiscal
2002 bringing the total number of stores operated by the Company to 207.
Currently, the Company plans to open approximately 40 new stores in 2003, of
which, 10 stores are expected to open in the first quarter.
The 10 stores opened during the third quarter included locations in:
City Market/Stores
Little Rock, AR Little Rock, 3
Ocala, FL Orlando, 4
Panama City, FL Panama City, 1
Vero Beach, FL West Palm Beach, 1
Hattiesburg, MS Hattiesburg, 1
Boardman, OH Youngstown, 1
Florence, SC Myrtle Beach, 1
Beaumont, TX Beaumont, 1
Laredo, TX Laredo, 1
Racine, WI Milwaukee, 2
Today, at 2:00 p.m. Eastern time, the Company will host a conference call
to discuss the third quarter results. The public can listen to the live
webcast of the call by visiting Shoe Carnival's Corporate Investor Relations
page at http://www.shoecarnival.com . While the question-and-answer session will be
available to all listeners, questions from the audience will be limited to
institutional analysts and investors. A replay of the webcast will be
available on our website for two weeks beginning approximately two hours after
the conclusion of the conference call.
This press release contains forward-looking statements that involve a
number of risks and uncertainties. A number of factors could cause our actual
results, performance, achievements or industry results to be materially
different from any future results, performance or achievements expressed or
implied by these forward-looking statements. These factors include, but are
not limited to: general economic conditions in the areas of the United States
in which our stores are located; changes in the overall retail environment and
more specifically in the apparel and footwear retail sectors; the potential
impact of national and international security concerns on the retail
environment; changes in our relationships with key suppliers; the impact of
competition and pricing; changes in weather patterns, consumer buying trends
and our ability to identify and respond to emerging fashion trends; risks
associated with the seasonality of the retail industry; the availability of
desirable store locations at acceptable lease terms and our ability to open
new stores in a timely manner; higher than anticipated costs associated with
the closing of underperforming stores; the inability of manufacturers to
deliver products in a timely manner; changes in the trade relationships
between the United States and countries which are the major manufacturers of
footwear.
In addition, these forward-looking statements necessarily depend upon
assumptions, estimates and dates that may be incorrect or imprecise and
involve known and unknown risks, uncertainties and other factors. Accordingly,
any forward-looking statements included in this press release do not purport
to be predictions of future events or circumstances and may not be realized.
Forward-looking statements can be identified by, among other things, the use
of forward-looking terms such as "believes," "expects," "may," "will,"
"should," "seeks," "pro forma," "anticipates," "intends" or the negative of
any of these terms, or comparable terminology, or by discussions of strategy
or intentions. Given these uncertainties, we caution investors not to place
undue reliance on these forward-looking statements, which speak only as of the
date hereof. We disclaim any obligation to update any of these factors or to
publicly announce any revisions to the forward-looking statements contained in
this press release to reflect future events or developments.
Shoe Carnival is a chain of 207 footwear stores located in the Midwest,
South and Southeast. 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, IN, Shoe
Carnival trades on the Nasdaq Stock Market under the symbol SCVL. Shoe
Carnival's press releases and annual report are available on the Company's
website at http://www.shoecarnival.com .
Financial Tables Follow
SHOE CARNIVAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share)
(Unaudited)
13 Weeks Ended 39 Weeks Ended
November 2, November 3, November 2, November 3,
2002 2001 2002 2001
Net sales $137,703 $124,778 $391,713 $355,950
Cost of sales
(including buying,
distribution and
occupancy costs) 97,238 87,965 276,405 251,927
Gross profit 40,465 36,813 115,308 104,023
Selling, general and
administrative
expenses 32,376 28,932 92,010 83,844
Operating income 8,089 7,881 23,298 20,179
Interest expense 161 480 625 1,911
Income before income
taxes 7,928 7,401 22,673 18,268
Income taxes 2,973 2,776 8,502 6,851
Net income $4,955 $4,625 $14,171 $11,417
Net income per share:
Basic $.39 $.38 $1.13 $.95
Diluted $.38 $.37 $1.09 $.92
Average shares outstanding:
Basic 12,595 12,195 12,545 12,077
Diluted 12,967 12,513 12,982 12,431
SHOE CARNIVAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
ASSETS
November 2, February 2, November 3,
2002 2002 2001
Current Assets:
Cash and cash equivalents $3,969 $5,459 $3,207
Accounts receivable 2,577 1,298 1,660
Merchandise inventories 147,909 135,648 137,289
Deferred income tax benefit 385 449 703
Other 2,040 1,816 2,055
Total Current Assets 156,880 144,670 144,914
Property and equipment-net 63,601 57,249 59,349
TOTAL ASSETS $220,481 $201,919 $204,263
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $42,794 $42,108 $33,242
Accrued and other
liabilities 12,640 10,452 10,675
Current portion of
long-term debt 482 834 945
Total Current Liabilities 55,916 53,394 44,862
Long-term debt 25,438 27,672 41,176
Deferred lease incentives 5,002 4,197 4,126
Deferred income taxes 4,467 4,223 4,191
Other 611 331 275
TOTAL LIABILITIES 91,434 89,817 94,630
SHAREHOLDERS' EQUITY 129,047 112,102 109,633
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $220,481 $201,919 $204,263
SHOE CARNIVAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Thirty-nine Thirty-nine
Weeks Ended Weeks Ended
November 2, November 3,
2002 2001
Cash Flows From Operating Activities
Net income $14,171 $11,417
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization 9,164 8,291
Loss on retirement of assets 128 127
Deferred income taxes 308 (171)
Other (72) (151)
Changes in operating assets and liabilities:
Merchandise inventories (12,261) (14,254)
Accounts receivable (1,061) (594)
Accounts payable and accrued liabilities 2,865 3,007
Other (209) (637)
Net cash provided by operating activities 13,033 7,035
Cash Flows From Investing Activities
Purchases of property and equipment (15,799) (9,476)
Lease incentives 1,135 831
Net cash used in investing activities (14,664) (8,645)
Cash Flows From Financing Activities
Net (payments) borrowings under line of credit (1,925) 375
Payments on capital lease obligations (708) (688)
Proceeds from issuance of stock 2,774 1,903
Net cash provided by financing activities 141 1,590
Net decrease in cash and cash equivalents (1,490) (20)
Cash and cash equivalents at beginning of period 5,459 3,227
Cash and Cash Equivalents at end of period $3,969 $3,207
SOURCE Shoe Carnival, Inc.
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Related links:
http://www.shoecarnival.com
Company News On-Call:
http://www.prnewswire.com/gh/cnoc/comp/127183.html
CONTACT:
Mark L. Lemond, President and Chief Executive
Officer, or W. Kerry Jackson, Senior Vice President and Chief
Financial Officer of Shoe Carnival, Inc., +1-812-867-4034
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