Financial Data and Key Metrics Changes - The company reported adjusted earnings per share of $0.22, with first quarter sales declining 6.8% year over year [8][26] - Consolidated gross margin was 45.4%, down 150 basis points compared to last year, driven by lower margins in both segments [26] - Operating earnings were $12.2 million, with an operating margin of 2% [28] Business Segment Data and Key Metrics Changes - Brand Portfolio sales declined 6.9%, while Famous Footwear sales were down 6.3% with comparable sales down 4.6% [20][26] - The Brand Portfolio gross margin was 43.8%, down 280 basis points due to lower initial margins and higher markdown reserves [26] - Famous gross margin was 45.3%, down 80 basis points due to increased promotional days and higher freight costs [26] Market Data and Key Metrics Changes - The company gained market share in women's fashion footwear despite overall sales declines [11] - Famous Footwear saw a 0.5 point market share gain in the kids category, with kids penetration at 21% [21] Company Strategy and Development Direction - The company is focused on controlling costs, optimizing sourcing strategies, and reducing SG&A expenses by $15 million annually [7][34] - The planned acquisition of Stuart Weitzman is seen as a strategic fit, enhancing the company's premium positioning and direct-to-consumer presence [18][19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging operating environment and emphasized the need to drive growth and profitability [6][7] - The company is cautiously optimistic about back-to-school sales and believes it is well-positioned to gain market share [24][40] Other Important Information - Inventory levels increased by 8.1% year over year, with a significant build for the Jordan brand launch [30] - Cash flow from operations was negative $5.7 million due to lower net income and higher inventory levels [30] Q&A Session Summary Question: How are you thinking about the prices of your portfolio brands moving into the summer and fall? - The company is making selective price increases and managing them in real-time with key partners [38][39] Question: Do you see the weaker brand portfolio brands being restructured or exited? - The company is reviewing its brand portfolio but has no immediate plans for restructuring [40] Question: Is Famous Footwear prepared for back-to-school? - The company is in a good position for back-to-school with no major cancellations reported [41] Question: What adjustments are being made for the $15 million in strategic expense cuts? - The reductions are permanent and structural, expected to begin in the third quarter [43][44] Question: Can you provide more context on the Jordan launch? - The Jordan launch is new, and while initial trends are encouraging, significant marketing will ramp up closer to back-to-school [46][57] Question: How are tariffs impacting your plans? - The company is currently maintaining its sourcing strategy and will adjust as necessary based on tariff developments [48][49] Question: How should we think about inventory reserves and customer credit issues moving forward? - The company believes it has adequately reserved for inventory markdowns and is closely monitoring customer credit ratings [62]

Core Insights - Caleres Inc. reported quarterly earnings of $0.22 per share, missing the Zacks Consensus Estimate of $0.37 per share, and down from $0.88 per share a year ago, representing an earnings surprise of -40.54% [1] - The company posted revenues of $614.22 million for the quarter, missing the Zacks Consensus Estimate by 1.09%, and down from $659.2 million year-over-year [2] - Caleres Inc. shares have declined approximately 29.3% year-to-date, contrasting with the S&P 500's gain of 0.1% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.82 on revenues of $675.67 million, and for the current fiscal year, it is $2.80 on revenues of $2.69 billion [7] - The estimate revisions trend for Caleres Inc. is currently unfavorable, resulting in a Zacks Rank 5 (Strong Sell), indicating expected underperformance in the near future [6] Industry Context - The Shoes and Retail Apparel industry, to which Caleres belongs, is currently ranked in the bottom 9% of over 250 Zacks industries, suggesting a challenging environment [8] - Another company in the same industry, Nike, is expected to report a significant decline in earnings, with a projected EPS of $0.11, down 89.1% year-over-year, and revenues expected to decrease by 15.4% from the previous year [9]

Financial Performance - Reported sales for Q1 2025 were $614.2 million, down 6.8% year-on-year, and below expectations [3] - Famous Footwear sales decreased by 6.3%, with comparable sales down 4.6% compared to Q1 2024 [4] - Net earnings were $6.9 million, or $0.21 per diluted share, compared to $30.9 million, or $0.88 per diluted share in Q1 2024 [4] - The total net sales for the consolidated segment decreased to $614,221,000 in Q1 2025 from $659,198,000 in Q1 2024, reflecting a decline of approximately 6.8% [18] - For the thirteen weeks ended May 3, 2025, Caleres, Inc. reported net earnings of $6,943,000, a decrease from $30,939,000 for the same period in 2024, resulting in a diluted earnings per share of $0.21 compared to $0.88 [21] - Gross profit was $278.7 million, with a gross margin of 45.4%, down 150 basis points from the previous year [4] - Gross profit for the consolidated segment was $278,694,000, down from $309,095,000 in the prior year, leading to a gross margin of 45.4%, down from 46.9% [18] - Operating earnings for the consolidated segment were $11,584,000, significantly lower than $42,758,000 in the same quarter of 2024, resulting in an operating margin of 1.9% compared to 6.5% [18] - For the thirteen weeks ended May 3, 2025, Caleres, Inc. reported EBITDA of $28,051,000, down from $57,381,000 for the same period in 2024, reflecting a decrease in EBITDA margin from 8.7% to 4.6% [23] - Adjusted net earnings attributable to Caleres, Inc. for the thirteen weeks ended May 3, 2025, were $7,409,000, compared to $30,939,000 in the same period of 2024, with an adjusted diluted earnings per share of $0.22 [22] Expenses and Cost Management - SG&A expenses as a percentage of net sales increased to 43.4%, up 300 basis points year-on-year [4] - The company announced structural cost-cutting actions to reduce SG&A by $15 million on an annualized basis [3] - The company implemented expense reduction initiatives that resulted in a positive impact of $6,103,000 on earnings [19] - The adjusted operating earnings for the Famous Footwear segment were $12,211,000, down from $42,758,000 in the prior year [19] Debt and Borrowings - Borrowings under the asset-based revolving credit facility were $258.5 million, up $67.5 million from Q1 2024 [11] - Caleres, Inc. reported borrowings under the revolving credit agreement of $258,500,000, an increase from $191,000,000 in the previous year [23] - The debt/EBITDA leverage ratio increased to 1.5 from 0.8 year-over-year, indicating a higher level of debt relative to earnings [23] Inventory and Store Operations - Inventory increased by 8.1% compared to Q1 2024 [11] - The company ended the period with 950 company-operated stores, a slight decrease from 954 stores in the previous year [18] Market Outlook - The company has suspended guidance due to market uncertainty [6] - Total charges related to acquisition and integration costs for the Stuart Weitzman brand amounted to $627,000 for the quarter [19] Trailing Twelve Months Performance - For the trailing twelve months ended May 3, 2025, net earnings attributable to Caleres, Inc. were $83,259,000, a decrease from $167,603,000 in the previous year [23] - The trailing twelve months EBITDA was reported at $177,371,000, with a margin of 6.6%, down from $247,157,000 and 8.8% respectively [23] - The adjusted EBITDA for the trailing twelve months was $187,882,000, with an adjusted EBITDA margin of 7.0%, compared to $253,260,000 and 9.0% in the prior year [23]

Core Insights - Coveo's AI-Relevance platform is being utilized by leading brands such as Caleres, FleetPride, and Freedom Furniture to enhance online experiences, increase conversions, and create new growth opportunities [1][3][4] Company Summaries Caleres - Caleres is a multi-billion dollar shoe retailer with a history of over 140 years, known for brands like Famous Footwear and Dr. Scholls [5] - The company faced challenges with its search and discovery technology due to a complex catalog of over 600,000 SKUs, leading to inefficiencies in data access and manual processes [6] FleetPride - FleetPride is North America's largest distributor of truck and trailer parts, with over 4,000 experts across more than 300 locations [7] - The company struggled with its digital presence, particularly in providing customers with accurate part information, which was compounded by a siloed inventory system [8] Freedom Furniture - Freedom Furniture is a well-established brand in Australia and New Zealand, known for stylish home furnishings and a strong retail presence [9] - The company is undergoing a digital transformation by revamping its ecommerce platform and adopting AI-driven search to enhance customer experiences [10] Performance Metrics - Coveo's implementation has led to a 21% year-over-year increase in revenue and a 25% increase in conversion rates for its clients [11] - FleetPride reported a 7% increase in revenue per visit and a 9.6% increase in conversion rates [12] - Freedom Furniture achieved a 5.5% uplift in average order value and a 50% decrease in merchandising effort [13]

Group 1 - Eni (E) is a leading integrated energy player with a Zacks Consensus Estimate for current year earnings revised down by 15.2% over the last 60 days [1] - Caleres (CAL) is a footwear retailer and wholesaler, with its Zacks Consensus Estimate for current year earnings revised down by 13.2% over the last 60 days [1] - CPI Card Group (PMTS) specializes in financial card production and related services, with a Zacks Consensus Estimate for current year earnings revised down by 5.7% over the last 60 days [2]

Store Operations - The Famous Footwear segment operated 846 stores at the end of 2024, selling primarily branded footwear for the entire family[15]. - The company operated 114 retail stores at the end of 2024, up from 98 in 2023, with plans to open approximately five new Allen Edmonds stores and 13 net new Sam Edelman stores in 2025[44]. - The company anticipates opening approximately eight new retail store locations and closing about 18 in 2025[22]. - The company operates 60 retail stores in the U.S. and 54 in East Asia under the Brand Portfolio segment[15]. - The company has 120 international branded stores operated by third parties through franchise agreements at the end of 2024[15]. Sales and Revenue - Net sales for women's footwear accounted for 60% in 2024, while men's footwear represented 21%, children's footwear 12%, and clothing and accessories 7%[16]. - The Brand Portfolio segment sold approximately 32 million pairs of shoes on a wholesale basis during 2024, with licensed products accounting for about 14% of sales[42]. - The backlog of unfilled wholesale orders as of February 1, 2025, was approximately $260.2 million, an increase from $234.5 million on February 3, 2024[53]. - The Famous Footwear segment's retail price points typically range from $20 for shoes to $300 for boots[19]. - Approximately 5% of Famous Footwear's net sales come from company-owned and licensed products sold by the Brand Portfolio segment[18]. Marketing and Advertising - Famous Footwear's marketing expenses in 2024 were approximately $56.4 million, aimed at reinforcing brand connection with consumers[24]. - The company invested approximately $78.3 million in advertising and marketing support for its Brand Portfolio segment in 2024[46]. Sourcing and Inventory - In 2024, the sourcing operations sourced approximately $494.4 million of shoes, with China and Vietnam being the largest sourcing countries at $244.7 million and $210.2 million, respectively[51]. - Approximately 25% of inventory receipts were sourced through speed programs during 2024, with expectations for continued growth in 2025[43]. - The Famous Footwear segment's distribution systems allow for weekly merchandise deliveries to stores, ensuring adequate stock[23]. Employee and Workforce - The company employs approximately 9,400 individuals, with 4,800 full-time and 4,600 part-time employees as of February 1, 2025[55]. - The company offers a comprehensive benefits package, including competitive salaries, health insurance, retirement plans, and education assistance[56]. - The company emphasizes health and safety training for newly hired associates, ensuring compliance with its Occupational Health and Safety Program[57]. - The company has no employees under union contracts in the U.S., with only 25 warehouse employees in Canada under a union contract expiring in October 2025[55]. Business Strategy and Goals - The Company signed a definitive agreement to acquire Stuart Weitzman for $105 million, expected to close in summer 2025, enhancing the Brand Portfolio segment[16]. - The company anticipates expanding its Naturalizer presence in East Asia with the opening of approximately five new stores in 2025[44]. - The company anticipates expanding the Sam Edelman presence in East and Southeast Asia with approximately 13 net new stores in 2025[44]. - The company aims to achieve its responsible business goals by 2025, focusing on eco-conscious products and practices[59]. - The company is committed to responsible business initiatives, focusing on sustainable practices and waste elimination in manufacturing[58]. - The company aims to use environmentally preferred materials and ensure compliance with global labor standards in its supply chain[59]. - The business is seasonal, with higher sales during back-to-school and holiday seasons, although earnings distribution has become more balanced in recent years[64]. - The company competes in a highly fragmented market with various retail formats, including traditional stores and e-commerce[60]. - The company has a steering committee to manage responsible business goals and metrics, with a report expected in spring 2025[59]. Product Offerings - The Brand Portfolio segment includes a variety of owned and licensed brands, with products sold at various price points ranging from $50 to $2,995[26][29]. - The Favorite Daughter Shoes line is set to launch in Fall 2025, with price points ranging from $195 to $495[39].

Financial Data and Key Metrics Changes - Fourth quarter adjusted earnings per share were $0.33, and full year adjusted earnings per share were $3.3, at the high end of guidance [8][28] - Fourth quarter consolidated sales were $639.2 million, down 8.3% year-over-year, with a $30.3 million unfavorable impact from the fifty-third week [24][25] - Full year consolidated sales were $2.72 billion, down 3.4% compared to the previous year [25] - Fourth quarter consolidated gross margin was 43%, an 80 basis point decrease from last year [25] - Full year consolidated gross margin was 44.9%, up approximately 10 basis points from last year [25] Business Line Data and Key Metrics Changes - Brand portfolio sales declined 7.2% in the fourth quarter, with a 5% decline excluding the fifty-third week [8][25] - Famous Footwear sales were down 9.6% in total and down 2.9% on a comparable basis [25] - Lead brands, including Sam Edelman, Allen Edmonds, Naturalizer, and Vionic, outperformed the overall brand portfolio [6][9] - Allen Edmonds showed growth across all channels, with strong performance in sport and dress loafers [10][11] Market Data and Key Metrics Changes - Internationally, the company activated new premium wholesale partnerships in Europe and continued expansion in China and Southeast Asia [10] - Famous Footwear's comparable store sales were down 2.9%, with brick-and-mortar sales down 4.1% and comparable web sales up 3.1% [16] Company Strategy and Development Direction - The company is focused on long-term growth by investing in key areas while reducing expenses elsewhere [6] - The acquisition of Stuart Weitzman is expected to enhance exposure to the contemporary segment and premium price points [16] - The company plans to upgrade 25 more stores to the Flare format in 2025, which has shown strong performance [18][73] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for 2025, despite challenges from inflation and tariffs [20][21] - The company anticipates sequential improvement throughout the year, driven by new product introductions and improved leadership [36][38] - Management noted that the current macroeconomic environment presents headwinds for value-based consumers [20] Other Important Information - The company returned approximately $75 million to shareholders through buybacks and dividends [7] - Inventory at year-end was $565 million, up 4.5% year-over-year, with a focus on managing aged inventory [29] Q&A Session Summary Question: Can you elaborate on the EPS guidance assumptions for the year? - Management expects sequential quarterly improvement, with specific initiatives driving growth in both Famous and brand portfolio segments [36][38] Question: What trends are seen in the contemporary segment? - Management noted that contemporary brands are trending positively, with strong performance in fashion sneakers and seasonal items [40][41] Question: How will gross margins be affected by markdowns and tariffs? - Management anticipates some gross margin decline due to tariffs and markdowns, but expects improvements as inventory becomes more current [50][72] Question: What is the outlook for the first quarter's operating margin? - The first quarter's operating margin is expected to be the lowest of the year, with improvements anticipated as the year progresses [58] Question: How are order trends in wholesale accounts? - Management indicated that they are seeing positive trends in wholesale accounts, with plans for continued growth in remodeled stores [73]

FOURTH QUARTER & FULL YEAR 2024 MARCH 20, 2025 SAFE HARBOR UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 This presentation contains certain forward-looking statements and expectations regarding the company's future performance and the performance of its brands. Such statements are subject to various risks and uncertainties that could cause actual results to differ materially. These risks include (i) changes in United States and international trade policies, including tariffs and trade restricti ...

Financial Performance - Fourth quarter sales were reported at $639.2 million, down 8.3% year-over-year, with full-year sales of $2,722.7 million, down 3.4% year-over-year[4] - Fourth quarter earnings per diluted share were $0.15, compared to $1.57 in the same quarter of the previous year, while full-year earnings per diluted share were $3.09, down from $4.80[8] - Fiscal 2025 consolidated net sales are expected to be down 1% to up 1% compared to fiscal 2024, with earnings per diluted share guidance of $2.80 to $3.20[9] - Adjusted net earnings for the fifty-two weeks ended February 1, 2025, were $114,595 thousand, compared to $149,269 thousand for the fifty-three weeks ended February 3, 2024, reflecting a decline of 23.2%[19] - For the 52 weeks ended February 1, 2025, net sales reached $1,556,456 thousand, a decrease of 3.3% compared to $1,609,396 thousand for the 53 weeks ended February 3, 2024[23] - Operating earnings for the 52 weeks ended February 1, 2025, were $87,076 thousand, compared to $123,838 thousand for the 53 weeks ended February 3, 2024, reflecting a decline of 29.8%[23] - Adjusted operating earnings for the 52 weeks ended February 1, 2025, were $87,715 thousand, down from $125,204 thousand in the previous year, indicating a decrease of 30%[24] Shareholder Returns - The company returned $74.7 million to shareholders in fiscal 2024 through share repurchases and dividends[4] Sales and Market Trends - Direct-to-consumer sales represented approximately 73% of total net sales in the fourth quarter[5] - The Famous Footwear segment saw a net sales decrease of 9.6%, with comparable sales down 2.9%[5] - Net sales for the Famous Footwear segment were $358,351 thousand for the thirteen weeks ended February 1, 2025, down 9.6% from $396,227 thousand in the same period last year[20] - Comparable sales on a 52-week basis decreased by 1.3% for the Famous Footwear segment[23] Profitability Metrics - The gross profit for the fourth quarter was $275.1 million, with a gross margin of 43.0%, down 80 basis points year-over-year[5] - The company reported a gross margin of 42.5% for the Famous Footwear segment in the thirteen weeks ended February 1, 2025, slightly down from 42.9% in the prior year[20] - Gross profit for the same period was $686,627 thousand, resulting in a gross profit rate of 44.1%, down from 44.7% in the previous year[23] - The gross profit rate for the Famous Footwear segment was 44.1%, slightly lower than the 44.7% reported in the previous year[23] Expenses and Liabilities - SG&A expenses were 40.9% of net sales in the fourth quarter, up 180 basis points compared to the prior year[8] - Total current liabilities rose to $757,933 thousand as of February 1, 2025, from $742,956 thousand, marking an increase of 2.0%[17] Cash Flow and Liquidity - Net cash provided by operating activities for the fifty-two weeks ended February 1, 2025, was $104,562 thousand, a decrease of 47.7% compared to $200,151 thousand for the previous year[18] - Cash and cash equivalents at the end of the period increased to $29,636 thousand, up from $21,358 thousand, showing a growth of 38.8%[18] - Total liquidity, including cash and cash equivalents, was $301.9 million as of February 1, 2025, down from $329.9 million the previous year[30] Store Operations - The company operated 846 stores at the end of the period, down from 860 stores a year ago, representing a decrease of 1.6%[20] - The company operated 846 stores at the end of the period, a decrease from 860 stores in the previous year[23] Debt and Financing - Borrowings under the revolving credit agreement increased to $219,500 thousand as of February 1, 2025, compared to $182,000 thousand a year earlier, indicating a rise of 20.6%[17] - The debt/EBITDA leverage ratio increased to 1.1 as of February 1, 2025, from 0.7 the previous year, with borrowings under the revolving credit agreement at $219,500 thousand[28] - Total availability under the revolving credit agreement was $272.3 million as of February 1, 2025, down from $308.5 million the previous year[30] Future Plans - The company plans to acquire Stuart Weitzman for $105 million, expected to close in summer 2025[7] - The company expects 75% of its Brand Portfolio sourcing to be outside of China by the second half of 2025[4] Earnings Adjustments - Adjusted diluted earnings per share for the thirteen weeks ended February 1, 2025, were $0.33, compared to $0.86 for the fourteen weeks ended February 3, 2024, reflecting a decline of 61.0%[19] - Basic adjusted earnings per common share attributable to Caleres, Inc. shareholders for the thirteen weeks ended February 1, 2025, was $0.33, compared to $0.87 for the fourteen weeks ended February 3, 2024[26] - Diluted adjusted earnings per common share for the same period was also $0.33, compared to $0.86 the previous year[26] - The company reported a net earnings attributable to Caleres, Inc. of $4,765 thousand for the 13 weeks ended February 1, 2025, compared to $53,394 thousand for the 14 weeks ended February 3, 2024[25] - Net earnings attributable to Caleres, Inc. for the thirteen weeks ended February 1, 2025, were $4,930 thousand, significantly lower than $55,808 thousand for the fourteen weeks ended February 3, 2024[28] - The company reported a net loss attributable to noncontrolling interests of $1,023 thousand for the thirteen weeks ended February 1, 2025, compared to a gain of $148 thousand the previous year[26] Restructuring Costs - The company incurred total charges/other items of $639 thousand related to restructuring costs for the 52 weeks ended February 1, 2025[24] EBITDA Metrics - Adjusted EBITDA for the thirteen weeks ended February 1, 2025, was $28,996 thousand, with an adjusted EBITDA margin of 4.5%, down from $49,471 thousand and 7.1% for the fourteen weeks ended February 3, 2024[28] - The trailing twelve months EBITDA as of February 1, 2025, was $206,701 thousand, with an EBITDA margin of 7.6%, compared to $253,504 thousand and 9.0% for the prior year[28]

Core Insights - The holiday season is critical for retailers, significantly affecting their performance, with Caleres Inc. facing unexpected challenges leading to a revised financial outlook [1][2] Group 1: Caleres Inc. Performance - Caleres has revised its financial outlook for fiscal 2024 due to softer-than-expected sales performance [2] - Sales momentum in the athletic segment at Famous Footwear declined in mid-December and January, falling short of expectations, compounded by weather-related disruptions [3] - The updated forecast anticipates consolidated net sales to decline approximately 3% to 3.5% year-over-year, with adjusted earnings projected between $3.20 and $3.30 per share, down from earlier guidance of a 2.5% to 3% decline in sales and adjusted earnings of $3.45-$3.55 per share [4][5] Group 2: Other Retailers' Performance - Five Below reported net sales of $1.19 billion during the holiday period, up from $1.10 billion in the previous year, but comparable sales dipped 3.2% [8] - Based on holiday performance, Five Below expects fourth-quarter sales to be in the upper half of its previous guidance of $1.35 billion to $1.38 billion [9] - Genesco announced a 10% increase in comparable sales for the fourth-quarter-to-date period, with same-store sales rising 6% and e-commerce sales surging 20% [10][11] - Abercrombie & Fitch revised its net sales outlook upward for the fourth quarter and fiscal 2024, expecting growth between 7% and 8% for the fourth quarter, up from 5% to 7% [12][13]