Caleres Outlines Three-Year Growth Plan, Expects Q3 Sales at Low End of Guidance
Ahead of its Investor Day on Thursday, Caleres announced updated longer-term financial targets and a new strategic plan for growth through fiscal 2026.
The St. Louis-based parent company to Famous Footwear, Sam Edelman, Allen Edmonds and more brands said it expects to deliver net sales at a three-year compound annual growth rate (CAGR) of between 3 and 5 percent, diluted adjusted earnings per share growth at a three-year CAGR of between 11 to 13 percent and annual total shareholder return in the low to mid teens.
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Shares of Caleres were up a little more than 1 percent before markets opened on Thursday.
In a statement, Caleres president and CEO Jay Schmidt said changes at the footwear company over the last four years have resulting in “a new baseline earnings level of $4 per diluted share,” with fiscal year 2023 representing the third year of this achievement.
“Caleres has a rich 145-year heritage and has always been committed to superior fit and innovation,” Schmidt said. “Our company has consistently adapted to consumer needs and economic changes while building trust with consumers.”
Caleres also introduced a three-year strategic plan focused on four pillars: growing its brand portfolio segment to make up about 50 percent of the company’s revenue by 2026, deepening Famous Footwear’s connections to the millennial family and leveraging its dominance in the kid’s market, leaning into the company’s “One Caleres” model that drives synergies and vertical integration across brands and delivering an improved financial perfomance over three years.
“Today, we are introducing a three-year strategic and financial plan expected to take our company to an even higher level of growth and profitability,” said Schmidt. “We believe our brand assets, competitive advantages, and core competencies put us in a unique position to achieve these results and deliver long-term value for our shareholders.”
Caleres reiterated its financial outlooks for the third quarter and fiscal year 2023, though said it expects sales to come in at the low end of its guidance range for both periods “given the challenging consumer demand environment in September.”
In Q3, Caleres expects net sales to be down low single digits compared to the prior year, and adjusted diluted earnings per share of between $1.30 and $1.35. For the fiscal year 2023, Caleres expects net sales to be down between 3 percent and 5 percent, with adjusted diluted earnings per share of between $4.10 and $4.30.
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