EVANSVILLE, Ind.--(BUSINESS WIRE)--Aug. 27, 2009-- Shoe Carnival, Inc. (Nasdaq: SCVL) a leading retailer of value-priced footwear and accessories, today announced sales and earnings for the second quarter ended August 1, 2009.

Sales for the second quarter of 2009 were $152.8 million, compared to sales of $158.5 million for the prior year second quarter. Comparable store sales declined 6.4 percent.

Net earnings for the thirteen-week second quarter were $982,000, or $0.08 per diluted share, compared to net earnings of $977,000, or $0.08 per diluted share, for the thirteen-week second quarter ended August 2, 2008.

The gross profit margin for the second quarter increased 0.2 percent to 26.8 percent compared to 26.6 percent for the second quarter of the prior year. The merchandise margin increased 0.4 percent, primarily due to better inventory control. As a percentage of sales, buying, distribution and occupancy costs increased 0.2 percent due primarily to the deleveraging effect of lower sales on occupancy costs.

Selling, general and administrative expenses for the second quarter decreased $1.7 million to $39.0 million, or 25.6 percent of sales, compared to $40.7 million, or 25.7 percent of sales, for the second quarter of 2008.

Speaking on the results, Mark Lemond, chief executive officer and president said, "We are pleased to report that we met or exceeded the majority of our internal goals for the second quarter of 2009. While consumer spending and the overall economic environment remained challenging in the second quarter, we were able to improve our year-over-year gross and operating margins and, therefore, record earnings per share equal to last year. We believe the absence of government stimulus checks, which were provided to the consumer during the second quarter of last year, had a negative impact on our second quarter comparable store sales and traffic. In addition, the sales-tax-free holidays in nine of our states shifted from the second quarter last year into the third quarter this year, which accounted for approximately two percent of the comparable store sales decline for the quarter."

Mr. Lemond continued, "For the first three weeks of August, our comparable stores sales have increased approximately 11 percent, as consumers are responding well to both our athletic and non-athletic product assortments. Only about 5 percent of the 11 percent increase is due to the shift of sales-tax-free holidays out of fiscal July and into fiscal August. While there is considerable uncertainty regarding consumer discretionary spending after back-to-school, we remain optimistic about the sales trends for the remainder of the third quarter. Therefore, due to these improved trends early in the third quarter, we expect to record positive comparable store sales for the quarter."

Net income for the first half of 2009 was $5.1 million, or $0.41 per diluted share, compared with net income of $5.8 million, or $0.46 per diluted share, in the first half of last year. Net sales for the first six months were $320.1 million compared to net sales of $320.6 million for the same period last year. Comparable store sales for the twenty-six week period ended August 1, 2009 decreased 3.3 percent, compared to the twenty-six week period ended August 2, 2008. The gross profit margin for the first six months of 2009 was 27.4 percent compared to 27.8 percent last year. Selling, general and administrative expenses, as a percentage of sales, were 24.7 percent for the first six months of 2009 as compared to 24.9 percent last year.

Store Growth

Currently, the Company expects to open approximately 16 new stores in fiscal 2009 and close eight stores. Store openings and closings by quarter and for the fiscal year are currently planned as follows:

The two stores opened during the second quarter included locations in:

Conference Call

Today, at 2:00 p.m. Eastern time, the Company will host a conference call to discuss the second quarter results. The public can listen to the live webcast of the call by visiting Shoe Carnival's Investor Relations page at www.shoecarnival.com. While the question-and-answer session will be available to all listeners, questions from the audience will be limited to institutional analysts and investors. A replay of the webcast will be available on our website beginning approximately two hours after the conclusion of the conference call and will be archived for one year.

Cautionary Statement Regarding Forward-Looking Information

This press release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that involve a number of risks and uncertainties. A number of factors could cause our actual results, performance, achievements or industry results to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. These factors include, but are not limited to: general economic conditions in the areas of the United States in which our stores are located; changes in the overall retail environment and more specifically in the apparel and footwear retail sectors; our ability to generate increased sales at our stores; the potential impact of national and international security concerns on the retail environment; changes in our relationships with key suppliers; the impact of competition and pricing; changes in weather patterns, consumer buying trends and our ability to identify and respond to emerging fashion trends; the impact of disruptions in our distribution or information technology operations; the effectiveness of our inventory management; the impact of hurricanes or other natural disasters on our stores, as well as on consumer confidence and purchasing in general; risks associated with the seasonality of the retail industry; our ability to successfully execute our growth strategy, including the availability of desirable store locations at acceptable lease terms, our ability to open new stores in a timely and profitable manner and the availability of sufficient funds to implement our growth plans; higher than anticipated costs associated with the closing of underperforming stores; the inability of manufacturers to deliver products in a timely manner; changes in the political and economic environments in the People’s Republic of China, Brazil, Spain and East Asia, the primary manufacturers of footwear; and the continued favorable trade relations between the United States and China and the other countries which are the major manufacturers of footwear.

In addition, these forward-looking statements necessarily depend upon assumptions, estimates and dates that may be incorrect or imprecise and involve known and unknown risks, uncertainties and other factors. Accordingly, any forward-looking statements included in this press release do not purport to be predictions of future events or circumstances and may not be realized. Forward-looking statements can be identified by, among other things, the use of forward-looking terms such as "believes," "expects," "may," "will," "should," "seeks," "pro forma," "anticipates," "intends" or the negative of any of these terms, or comparable terminology, or by discussions of strategy or intentions. Given these uncertainties, we caution investors not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. We disclaim any obligation to update any of these factors or to publicly announce any revisions to the forward-looking statements contained in this press release to reflect future events or developments.

Shoe Carnival is a chain of 314 footwear stores located in the Midwest, South and Southeast. Combining value pricing with an entertaining store format, Shoe Carnival is a leading retailer of name brand and private label footwear for the entire family. Headquartered in Evansville, IN, Shoe Carnival trades on The NASDAQ Stock Market LLC under the symbol SCVL. Shoe Carnival's press releases and annual report are available on the Company's website at www.shoecarnival.com.

Financial Tables Follow

Source: Shoe Carnival, Inc.

Shoe Carnival, Inc.
Mark L. Lemond, 812-867-6471
President and Chief Executive Officer
or
W. Kerry Jackson, 812-867-6471
Executive Vice President, Chief Financial Officer and Treasurer
www.shoecarnival.com