Shoe Carnival posts 7.2 percent drop in Q4 sales

Shoe Carnival's fourth quarter 2022 net sales of 290.8 million dollars decreased 22.6 million dollars or 7.2 percent, compared to the fourth quarter of 2021. In January 2023, the first comparable month without government stimulus, net sales increased low single digits versus January 2022.

However, fourth quarter net sales increased 50.9 million dollars or 21.2 percent, compared to the pre-pandemic fourth quarter 2019, with the Shoe Station bannered stores contributing 24.3 million dollars. Comparable store sales increased 12.6 percent.

Full year net sales grew 225.7 million dollars or 21.8 percent compared to 2019, with the Shoe Carnival banner growing 125.8 million dollars and the Shoe Station stores acquired and recently opened contributing 99.9 million dollars.

"The Shoe Carnival team successfully delivered operating income margins and overall profitability more than double those generated just three years ago, consistent with our strategic plans and 2022 guidance. These results demonstrate the sustainability of our profit transformation and set the new benchmark for us going forward," said Mark Worden, the company’s president and CEO.

Highlights of Shoe Carnival’s Q4 results

Fourth quarter 2022 gross profit margin increased 100 basis points to 38.3 percent compared to fourth quarter 2021, operating income was 28.7 million dollars and was 9.9 percent of net sales. Net income and EPS on a GAAP basis for the quarter were 21.6 million dollars and 79 cents, respectively.

Gross profit margin increased 920 basis points to 38.3 percent compared to fourth quarter 2019. Operating income was 28.7 million dollars and was 9.9 percent of net sales, nearly five times higher than the operating margin in fourth quarter 2019.

Net income and EPS on a GAAP basis were 21.6 million dollars and 79 cents, respectively, with EPS increasing over 550 percent compared to fourth quarter 2019.

Shoe Carnival reveals outlook for FY23

Shoe Carnival expects net income to range between 109 million and 114 million dollars, down 1 percent to up 4 percent compared to 2022, and EPS in the range of 3.96 dollars to 4.20 dollars for fiscal 2023, flat or an increase of 6 percent compared to fiscal 2022.

Net sales are expected to be in the range of 1.26 billion to 1.32 billion dollars, flat to increase of 4.5 percent compared to 2022

The company ended its fiscal year with 397 total stores, 373 Shoe Carnival stores and 24 Shoe Station stores. Since its fiscal year end, the company has opened one Shoe Station store and launched the Shoe Station ecommerce site, Shoestation.com. The company is on track to operate over 400 stores in the third quarter 2023. The company plans to surpass 500 stores and be a multi-billion dollar retailer by 2028, inclusive of organic and acquired growth.

The company’s board of directors approved an 11 percent increase to the quarterly cash dividend from 9 cents to 10 cents per share to be paid on April 17, 2023 to shareholders of record as of the close of business on April 3, 2023.