CLAYTON — Caleres is restructuring amid lower sales and local jobs will be affected, company officials said Thursday.
Stocks for Caleres dropped double digits Thursday morning after the footwear company announced lower-than-expected sales for the quarter, citing slow back-to-school shopping.
Caleres reported sales of $683 million, down about $12 million or 1.8% from last year’s second quarter. There was a 5% decline in brand portfolio sales due to operational challenges connected to the use of new software and weak demand for sandals, the company said.
CEO and president Jay Schmidt told investors that Caleres is restructuring, which he expects will save the company $7.5 million on an annual basis and $2 million in this fiscal year. He didn’t give details.
“The restructuring refers to alignment of our teams in Ƶ, and across all our locations, to best fuel growth opportunities. This does include some impacted positions in Ƶ as well as the opportunity for new positions here,” said Doug Koch, Caleres’ chief human resources officer, in a statement. The company did not reveal the number of jobs affected, or a timeline for action.
People are also reading…
Caleres is also lowering its yearly guidance in response to its second quarter numbers. For fiscal 2024, the company is now expecting net sales to fall by low single digits instead of its previous guidance of staying flat or up by 2%. Caleres’ earnings per share outlook is now $3.94 to $4.09, versus its previous $4.30 to $4.60.
Schmidt said back-to-school shopping started late this year, a result of consumers’ “wear now” mentality.
“We did see people really prioritizing their spending and spending when they needed it,” Schmidt said.
But back-to-school shoe shopping “surged” in August, closer to when students actually returned to the classroom, and helped bring the season total in line with company expectations.
Caleres’ Famous Footwear brand saw an 1.5% increase of sales, and gained market share in the kids category, company leaders said.
“While our brands and products continue to resonate with consumers and we remain confident in our long-term vision, our second quarter results in both segments fell short and do no reflect our true potential,” Schmidt said.
Shares of the company opened at $29.89, almost 20% lower than when stocks closed on Wednesday. Caleres operates brands such as Famous Footwear, Sam Edelman and Dr. Scholl’s Shoes. The company is headquartered at 8300 Maryland Avenue.