Caleres, the owner of the Famous Footwear retail chain and brands such as Naturalizer, Sam Edelman and Franco Sarto, reported consolidated sales of $774.7 million for the third quarter, up by 5.8 percent on an annualized basis. The figure includes Allen Edmonds, which was acquired in December of 2016. Net earnings for the quarter were roughly flat at $34.4 million. The gross margin of 40.9 percent was up by 0.8 percentage points.
Like other American footwear and apparel firms and retailers, Caleres also said its results during the third quarter were negatively impacted by hurricanes. The company experienced a strong start to the quarter in August, which was interrupted by the hurricanes that swept through Florida and Texas in September, and then by an unseasonably warm start to autumn in October. Weather-related events had a negative impact on total revenues of around $35 million, the company said.
Famous Footwear's sales rose by 1.1 percent to $473.1 million. On a same-store basis, the retail chain's sales increased by 0.9 percent as a double-digit increase in lifestyle athletic sales offset the weakness in boots engendered by the unseasonably warm weather. Sales of women's boot were down by around 20 percent in the quarter. Sandals were up by 3 percent. Back-to-school sales rose by 2.6 percent on a same-store basis.
In the Brand Portfolio segment, which covers the group's wholesale business, sales of $301.5 million were up by 14.0 percent when including contribution from Allen Edmonds. Excluding Allen Edmonds, sales were down in the segment by 2.6 percent due to slower boot sales related to the warm start to autumn. Sam Edelman, Naturalizer, Dr. Scholl's and Vince all continued to show significant progress, the company said.
The segment's operating profit fell by 20 percent to $24.3 million in spite an improved of 1.92 percentage points in the gross margin to 39.4 percent. A higher percentage of direct-to-consumer sales and rapid replenishment initiatives contributed to boost the gross margin. E-commerce now represents 30 percent of the segment's revenues.
Sales improved in November with the arrival of more seasonal weather. As a result, Caleres said it is maintaining its guidance for the current financial year. Consolidated sales are expected to end up in a range of $2.7 billion to $2.8 billion. Famous Footwear's sales on a same-store basis should go up by low single digits, while Brand Portfolio sales are expected to rise in the high teens.