Shares of Shoe Carnival jumped nearly 20% at the opening bell on Thursday as the shoe retailer beat Wall Street earnings estimates and reported strong back-to-school sales against 2019 rivals At press time, the stock was still up 11%.
In an interview with FN, CEO Mark Worden noted that today’s market gains were led by the company announcing the highest three-day sales period in its history, during the back-to-school season. this month.
In its earnings release, the company said August year-to-date merchandise sales were up in the mid-teens from 2019 and down to mid-digits from 2021. back-to-school in August drives more than half of the company’s third-quarter profitability, the company added.
Additionally, Worden told FN that the company reached nearly 30 million repeat customers this quarter, up just under 30% from 2019. nearly $2 is greater than all-year earnings in the 44-year history, except for last year’s stimulus, boosted results,” Worden added.
“It comes down to our customers’ loyalty to Shoe Carnival, and our new Shoe Station brand translates to the highest profitability we’ve seen in a long, long time,” the CEO said.
In the second quarter of 2022, the Evansville, Indiana-based retailer reported net sales of $312 million, up 16.4% from 2019 but down 6% from 2021. Net income in the second quarter was $28.9 million, or $1.04 diluted. to share. This is down from $44.2 million for the same period last year.
Sales of athletic styles took an expected hit in the quarter, Worden noted, with the company attributing this to an inability to deliver new styles to the category to meet demand due to supply chain challenges. Sports stocks ended the quarter down in teens compared to 2019.
But Shoe Carnival merchandising director Carl Scibetta said on its earnings call on Thursday that the company believes sports stocks will be replenished in the third quarter.
When it comes to non-athletic footwear, the company exceeds its expectations. Non-athletic women increased in their twenties compared to 2019. Sales were led by apparel, up more than 50%, and sandals, up in their mid-teens. Sales of men’s non-athletic footwear increased in the mid-20s compared to 2019. Men’s dress and casual wear both grew by more than 20% and men’s boots by more than 30%. And children’s non-sports sales rose in the 1950s. Increases in this segment were driven by children’s casual wear, up over 90%, and babies’, up over 70%.
“As consumers resoundingly return to a more normal life outside the home, we see that these dressing opportunities will continue to be strong for the rest of the year,” Worden told FN. “We are expecting a stellar non-sporting season as we enter boots shortly and then vacation. Additionally, there has been so much athletics shopping during the pandemic that we are seeing our customers have their closets filled with a wonderful assortment. So we see this category falling back at this point and the non-sporting ramp-up.
As for Shoe Station, which the company bought in December for $67 million, Worden told FN that the banner “continues to exceed expectations on all fronts.” Shoe Station sales were $54 million in the first half of 2022, and the company now expects sales to exceed its previously announced full-year expectation of 100 million by about 10%. of dollars.
This growth only reinforces the company’s plans to expand the Shoe Station store portfolio. At the time of purchase, there were 21 Shoe Station stores. By 2023, there will be at least 30 total stores in the banner, Worden told FN, with the number surpassing 100 locations and beyond over the next five years.
“We have almost completed the integration less than a year after the acquisition,” said the CEO. “Shoe Station is proving to be a resounding success and will continue to be a growth story for many years to come. The high-income consumer benefits from our wide assortment of top brands, and it far exceeds expectations. So we’re going to grow that as fast as real estate can happen all over the southern United States. »
Looking ahead, the company expects full-year 2022 net sales to be between $1.29 billion and $1.34 billion, up 24% to 29% compared to 2019.