Shoe Carnival has raised its guidance for the full year after reporting higher profits and comparable store sales for its third fiscal quarter.
The company said it recorded growth in all geographic regions and all product categories, with comparable store sales growing by 4.5 percent, on top of a 4.4 percent increase for the same quarter last year. On a year-to-date basis, the company's comparable store sales increased by 4.2 percent, while operating income jumped by 28.6 percent.
As a result of this performance, the management now expects sales in the range of $1,020 million to $1,022 million for the full financial year, with comparable store sales up by approximately 3.5 percent. The previous guidance was calling for sales in the range of $1,016 million to $1,020 million, with comparable store sales up by a low single digit.
The management of the American shoe retail chain highlighted the relaunch and upgrade of its Shoe Perks program, which was launched just prior to the back-to-school period. This new program offers high-value customers a new tier of rewards that is designed to incentivize them to make repeat purchases. The company said this drove a double-digit increase in members' sales for the quarter.
Overall, the company's sales for the three months ended Nov. 3 were down by 6.4 percent from the year-ago period to $269.2 million. But this was attributed mainly to the fact that fiscal 2017 was a 53-week year, and thus about $25.1 million of net sales reported in the third quarter of 2017 were shifted into the second quarter of fiscal 2018.
By categories, sales of women's non-athletic footwear increased by mid-single-digits, driven by boots and sandals. The management said that customers responded to the company's women's boot assortment and marketing efforts throughout the quarter, producing a comparable store sales increase in the 20s during the quarter. The men's non-athletic department was up by mid-single-digits on a comparable basis. Children's shoes also rose by mid-single-digits on a comparable basis.
On the athletic side of the business, boys' produced a mid-single-digit comparable gain, while girls' grew at a double-digit rate. Adult athletic improved by a low single-digit rate on a comparable basis. Men's athletic was flat for the quarter, while women's athletic was up by a mid-single-digit.
Shoe Carnival opened three stores during the quarter, ending with a total of 402 stores. The gross margin improved by 0.4 percentage points to 30.2 percent for the quarter, while net income jumped by 12.6 percent to $12.0 million.