Demo
SCVL Nasdaq· Shoe Carnival, Inc
FundamentalsNews digest Peer analysis
Login
SCVL Nasdaq· Shoe Carnival, Inc
Earnings report Q4 2023

Shoe Carnival Reports Decline in Revenue for Q3 2023

Segments of revenue

  • Revenue from Shoe Carnival stores declined by mid-single digits during the back-to-school season, with most merchandise categories experiencing a decline, partially offset by growth in children's athletics.
  • September and October net sales were lower, resulting in a high-single digit decline in comparable net sales for the quarter. This decline was primarily due to softness in seasonal and fall merchandise sales, including boot sales.
  • E-commerce sales, which accounted for approximately 10% of merchandise sales in Q3 2023, saw favorable growth following the launch of shoestation.com in February 2023 and increased sales through shoecarnival.com.

Strengths

  • Despite the decline in revenue, Shoe Carnival achieved its third-best Q3 in terms of EPS and net sales, only surpassed by the same quarter in fiscal years 2022 and 2021.
  • The company's investments in customer relationship management (CRM) systems, store modernization, and e-commerce capabilities have continued to yield positive results. These investments have led to sustained higher gross profit margins, increased customer conversion, and growth in loyalty members compared to pre-CRM and pre-modernization results in 2019.

Challenges

  • The decline in revenue from Shoe Carnival stores, particularly in September and October, impacted the overall performance for the quarter.
  • Increased promotions on seasonal and fall merchandise contributed to a decrease in merchandise margin, which affected the gross profit margin.

Noteworthy

  • Shoe Carnival maintained a gross profit margin exceeding 35% for the 11th consecutive quarter, despite a slight decrease compared to the same quarter in the previous year.
  • The total number of loyalty customers grew nearly 8% compared to Q3 2022, and Shoe Station loyalty members experienced an 18% growth.
  • Store conversion was over 400 basis points higher compared to pre-CRM and pre-modernization results in 2019.

Summary

Shoe Carnival faced challenges in Q3 2023, with a decline in revenue primarily driven by lower net sales in September and October. However, the company's investments in CRM systems, store modernization, and e-commerce capabilities have continued to yield positive results, including sustained higher gross profit margins and increased customer loyalty. Despite the decline in revenue, Shoe Carnival achieved its third-best Q3 performance in terms of EPS and net sales. The company's focus on customer relationships and modernization efforts positions it well for future growth opportunities.

Source documents

Form 10-Q  filed on Dec 01, 2023
85 pages scanned

Reference data

Company financials Q4 revenue 320M
Analyst estimates Q4 EPS missed by -17.81%
Sign up to Fey

Get in-depth analysis on thousands of stocks for just $30/month. Cancel anytime.