Caleres, Inc. (NYSE:CAL) Q4 2017 Earnings Conference Call Transcript

Mar 13, 2018 • 04:30 pm ET

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Caleres, Inc. (NYSE:CAL) Q4 2017 Earnings Conference Call Transcript

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Operator
Operator

Good afternoon. My name is Sarah, and I will be your conference operator today. At this time, I would like to welcome everyone to the Fourth Quarter 2017 Caleres Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers remarks, there will be a question-and-answer session. (Operator Instructions)

It is now my pleasure to introduce today's speaker Ms. Peggy Reilly Tharp. Ms. Reilly Tharp, the floor is yours.

Executive
Peggy Reilly Tharp

Thank you. Good afternoon. I'm Peggy Reilly Tharp, Vice President of Investor Relations for Caleres. And I'd like to thank you for joining our fourth quarter 2017 earnings call and webcast. A press release with detailed financial tables and slides are both available at caleres.com.

Please be aware, today's discussion contains forward-looking statements, which are subject to a number of risks and uncertainties. Actual results may differ materially due to various risk factors including, but not limited to, the factors disclosed in the company's Form 10-K and other filings with the US Securities and Exchange Commission. Please refer to today's press release and our SEC filings for more information on risk factors and other factors, which could impact forward-looking statements. Copies of these reports are available online. The company undertakes no obligation to update any information discussed in this call at any time.

Joining the call today are Diane Sullivan, CEO, President and Chairman; Ken Hannah, Chief Financial Officer; and Rick Ausick, President, Famous Footwear.

And I would now like to turn the call over to Diane Sullivan

Executive
Diane Sullivan

Thanks, Peggy, and good afternoon, everyone, and thanks so much for joining us today to talk about what was just an outstanding year by any measure. In addition to an excellent year, we also had a fantastic quarter. And thanks to our team's perseverance and agility, we delivered these great results in the midst of what is a very well-documented changing consumer landscape. Just to give you a few of our 2017 highlights. Sales were up 8% for the year and up nearly 10% in the quarter. Adjusted gross margin improved 85 basis points over last year and was up 54 basis points in the quarter. SG&A expense was well managed overall in 2017, and we leveraged our spend particularly well in the fourth quarter. Adjusted earnings per share for 2017 were up 8%, to $2.16, coming in at the middle of the range we guided to last March and maintained throughout the year.

Famous Footwear comp sales were up 1.4% for the year and were up 2.8% for the quarter. Our brand portfolio shipped more than 46 million pairs of shoes in 2017 and they had a record setting shipping month in January. Sam Edelman sales crossed the $200 million mark this year, and our Allen Edmonds acquisition that we acquired last - late last year remains very much on track. And with respect to our balance sheet, we reduced our inventory position by 2.8% and maintained our flexible balance sheet and our cash flow strengths, as