Shoe Carnival Inc. (NASDAQ:SCVL) Q1 2019 Earnings Conference Call - Final Transcript

May 22, 2019 • 04:30 pm ET

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Shoe Carnival Inc. (NASDAQ:SCVL) Q1 2019 Earnings Conference Call - Final Transcript

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Executive
Clifton E. Sifford

percentage of net sales and SG&A deleveraged by 15 basis points. As a result, operating income decreased by 58 basis points. EPS for the quarter was $0.91 per diluted share, an increase of approximately 9.6% compared to quarter one last year. Kerry will give you more detail on our financials in his prepared remarks.

Focusing on our first quarter comparable store sales by department. Women's non-athletic was up low-single digits on a comparable basis. Women's boots and women's sandals were up mid-single digits on a comparable basis at higher margins compared to quarter one last year. For the combined Easter time period of March and April, women's non-athletic was up mid-single digits on a comparable basis due to the strong performance of sandalized footwear.

The men's non-athletic department continued its strong performance posting a mid-single digit comparable store sales increase, just like the women's non-athletic department, increases were driven primarily from the sandal and boot categories. For the combined Easter time period, men's non-athletic produced a high-single digit comparable store sales increase.

The Children's shoe department was down slightly for the quarter on a comparable basis. We produced a mid-single digit increase in non-athletic and the low single-digit decrease in athletic. For the combined Easter time period, Children's shoes produced a mid-single digit comparable store sales increase with non-athletic up double-digit and athletic up mid-single digits. The non-athletic was also down low mid-single digits on a comparable basis.

The lower comp sales in athletic footwear were primarily as a result of the February tax season. On a combined basis for March and April, adult athletic footwear posted a slightly positive comparable store sales increase.

We believe that based on our sales results for the combined months of March and April that we are well positioned to take advantage of the key family footwear trends, our merchants have identified as we progressed through the remainder of the year.

We ended the first quarter with 395 stores in 35 states in Puerto Rico. During the quarter, we closed two stores and we had no new store openings.

Our CRM strategy continues to move forward nicely. We expect our initial implementation to be complete by the end of the calendar year. We remain convinced that our holistic approach to CRM will be a sales driver and will allow us to better align our real estate team to identify specific market areas where our typical shopper lives. Over the past year, we have spent a great deal of time analyzing our systems and processes to make sure we have all the capabilities to achieve our aggressive growth plans for the next three to five years. In addition to building a world class CRM capability, which will drive sales in both brick-and-mortar and online, we are now in the process of improving our capabilities in both supply chain and order management through investments in software and analytical tools.

Retail is ever changing and Shoe Carnival will continue to make the necessary investments in technology and