Brown Shoe Co. Inc. (BWS)
Q3 2009 Earnings Call
November 24, 2009; 9:00 am ET
Ron Fromm - Chief Executive Officer
Diane Sullivan - President & Chief Operating Officer
Mark Hood - Chief Financial Officer
Joe Wood - President of Retail
Ken Golden - Director of Investor Relations
Chris Svezia - Susquehanna Financial
Previous Statements by BWS
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Thanks Carrey. Good morning everyone and thanks for joining us for the Brown Shoe third quarter 2009 financial results conference call. This call is being made accessible to the public via webcast in accordance with the SEC’s Regulation FD.
Before I turn the call over to Ron Fromm, I’d like to remind you of the company’s Safe Harbor language. During this conference call, the company will make certain forward-looking statements to help you better understand its financial results and competitive outlook.
Discussion of the company’s future plans and other statements in this call that are not current or historical facts are forward-looking statements. These involve known and unknown risks and uncertainties that could cause the actual results to materially differ from historical results or from any future results expressed or implied by any forward-looking statements.
Factors that could cause actual results to differ materially include those listed in our press release issued this morning and available on our 8-K filed prior to this call and other risk factors listed from time-to-time in the company’s SEC reports. Copies of the company’s reports are available online and from the company’s Investor Relations Department. The company does not undertake any obligation or plan to update these forward-looking statements even though the situation may change.
Now, I’d like to turn the call over to Ron Fromm, Chairman and CEO.
Welcome everyone. Good morning and thank you for joining us. With me on the call are: Diane Sullivan, our President and Chief Operating Officer; Mark Hood, our Chief Financial Officer: and Joe Wood, the President of Retail.
Following my opening remarks, Mark will discuss our financial performance in more detail as well as review our outlook and then Diane will provide additional insight into our operating performance, following this as always we will be available to answer all of your questions. We are pleased to deliver solid third quarter results with increased same store sales, increased gross margins, as well as growth in earnings per share.
During the quarter, we successfully capitalized on the back-to-school selling season with great brands and product, while we strategically maximized our marketing by emphasizing the most important weeks of the season. This lead to better than expected performance of Famous Footwear as well as great results and are naturalize of retail locations.
Before I delve in to the quarter’s performance of more detail, I’d just like to address the organizational changes we announce last week. To recap, Gary Rich, Division President of Wholesale, and Joe Wood, Division President of Retail, will be retiring in early 2010. Both Gary and Joe have been with us a long time, and have been integral to the success of Brown Shoe.
A testament to their contributions that both have been made over the years is the great talent that they have developed across and throughout the organization. It also speaks to the importance of our organization and how we place importance on attracting strong talent. This combination gave us the ability to utilize our solid bench strength and promote from within. We have been preparing for these success and changes overtime to ensure we have the right team in place to continue meeting our customers and vendor partner needs.
Gary and Joe will remain on threw early 2010 to help ensure smooth transition, and while it will be difficult to say good bye to Joe and Gary next year, we are looking forward to building on the tremendous legacy with our new leadership team. Additionally we’ll have the benefit of having the strong team in place; we’ll also be able to leverage it across a leaner leadership platform.
Moving on to the decision of the third quarter, as we discussed on our August call, we built a plan to capitalize on the back-to-school selling season at Famous Footwear, as well as the fall fashion season across the reminder of the portfolio. The launch of our Make Today Famous campaign ahead of back-to-school boosted brand awareness and contributed to the increase in store visits from new and existing customers. Make Today Famous included our First National Television advertising along with several other new marketing vehicles. Diane will discuss this in more detail in a little while.
Visually, our merchandise and signage made it easy for consumers to shop and buy and powerfully conveyed the brand messages of our campaign. I can say that our customers told us that our stores and assortments have never looked better. I would like to thank the Famous team, they did a job and hard work of planning as well as delivering such a successful back-to-school season. As you know a successful back-to-school season at Famous Footwear is vital to the success of Brown Shoe.
Wholesale we created strong boot offerings, to capitalize on the consumer demand for the category, while providing compelling fashion product across all of our brands and we worked diligently with our retail partners to deliver the right product in the right quantities at the right time, resulting in improved sell throughs, inventory management, and ultimately improved margins.