Brown Shoe Co (BWS), a footwear company, has announced a 17.63 percent rise in profit for the quarter ended Aug. 02, 2014. The company earned $18.06 million or $0.41 a share in the second-quarter compared with $15.36 million or $0.35 a share a year ago. Analysts on average had predicted net income of $0.34 a share.
Revenue during the second-quarter went up marginally 2.28 percent to $635.88 million from $621.71 million in the last year period.
Gross margin contracted by 12 basis points over the last year period to 40.83 percent. Total expenses as a percentage of revenues decreased to 95.08 percent from 96.33 percent in the same period last year. That has resulted in improvement of 125 basis points in operating margins to 4.92 percent.
The company reported operating income of $31.30 million, compared with $22.81 million in the previous year period.
''Our second quarter results reflect the health of both our retail and wholesale businesses, as we continue to benefit from - and expand on - our portfolio realignment efforts,'' said Diane Sullivan, CEO, president and chairman of Brown Shoe Company. ''At Famous Footwear, our focus on delivering a seamless omni-channel experience to our consumers helped kick off our Back-to-School selling season. At our wholesale brands, our trend-right merchandise is resonating with both consumers and retailers.''
''To account for our better-than-expected second quarter performance, we are raising our annual guidance range to $1.50 to $1.60.''
Cash Flow
Brown Shoe Co has generated cash of $66.49 million from operating activities during the first half, up 87.36 percent or $31 million when compared with the last year period.
The company has spent $91.29 million cash to meet investing activities during the first half, as against cash inflow of $38.91 million in the last year period. It has made net capital expenditure of $91.29 million during the first half, which was higher by 199.95 percent or $60.86 million, from a year ago.
The company has spent $11.54 million cash to meet financing activities during the first half, as against cash outgo of $88.03 million in the last year period. It has made net repayment of $7 million debt during the first half. It has spent net of $0.52 million on repurchase of common stocks.
The company's cash dividend payment increased 1.03 percent or $0.06 million to $6.11 million.
As on Aug. 02, 2014, the company's cash balance stood at $46.88 million, down 11.78 percent or $6.26 million from Aug. 03, 2013.
Working Capital
Brown Shoe Co has witnessed an increase in the working capital over the last one year. The company's working capital stood at $368.34 million as at Aug. 02, 2014, up $5.80 million or 1.60 percent from $362.54 million on Aug. 03, 2013. It registered a decrease in current ratio to 1.74 as at Aug. 02, 2014 from 1.76 on Aug. 03, 2013.
Debt Position
Brown Shoe Co has witnessed an increase in long-term debt over the last one year. As on Aug. 02, 2014, long-term debt stood at $199.10 million, up 0.09 percent or $0.19 million, from Aug. 03, 2013. The company's total debt was 15.45 percent of total assets as on Aug. 02, 2014, compared with 18.79 percent on Aug. 03, 2013.
Interest coverage ratio, which determines how easily a company can pay interest expenses on outstanding debt, has improved to 6.11 from 4.39 in the same period last year.
