Expense management and cost-cutting helped Brown Shoe Co., Inc. beat analyst expectations during the first quarter.
The St. Louis-based company reported a net loss of $7.6 million, or 18 cents a diluted share, compared with a profit of $7.2 million, or 17 cents, during the year-ago quarter. Analysts polled by Yahoo Finance had expected an earnings-per-share loss of 27 cents.
Brown’s revenues for the quarter dropped 3 percent to $538.7 million, versus $554.5 million in the first quarter of 2008. The Famous Footwear division saw sales decline slightly to $317.6 million, and same-store sales dip 4.9 percent in the first quarter. The company also said it will close more Famous Footwear stores, with plans for new stores in 2009 to be flat to down 15 locations.
Brown’s wholesale division, which includes Naturalizer and Dr. Scholl’s, declined by 5 percent for the quarter, posting net sales of $168.8 million.
“Our sales decline was driven by lower traffic, which has led to reductions in shipments to our wholesale customers and negative comparable-store sales at Famous Footwear and our other owned retail stores,” Ron Fromm, Brown’s chairman and CEO, said during a conference call. “The good news is that inventory levels remain lean throughout our channels of distribution and our brands are performing solidly, considering the environment.”
Based on its first-quarter results, Brown now expects to narrow its net loss in the second quarter and post positive earnings for the full year. Although the company anticipates growth in its new brands and channels of distribution, high-single-digit declines in its existing and private-label brands will contribute to forecasted revenues of $2.2 billion to $2.3 billion for the year.