Quarterly Results

FORT MILL, S.C.--(BUSINESS WIRE)-- Shoe Carnival, Inc. (Nasdaq: SCVL)(the “Company”), a leading retailer of footwear and accessories for the family, today reported results for the fourth quarter and fiscal year ended January 31, 2026 (“Fiscal 2025”) and provided guidance for its fiscal year ending January 30, 2027 (“Fiscal 2026”).

Fourth Quarter and Fiscal 2025 Highlights

• Fourth quarter EPS of $0.33 and full year EPS of $1.90 both exceeded consensus expectations.
• Shoe Station net sales grew 2.7 percent for Fiscal 2025, outperforming the family footwear industry for the third consecutive year.
• Annual gross profit margin exceeded 35 percent for the fifth consecutive year, increasing 100 basis points versus Fiscal 2024.
• Company ended Fiscal 2025 debt-free for the 21st consecutive year, with $130.7 million in cash, cash equivalents, and marketable securities.
• The Board of Directors approved a quarterly dividend increase to $0.17 per share, marking the 12th consecutive year of dividend increases.

“Fourth quarter results exceeded consensus expectations, and Fiscal 2025 demonstrated this organization's ability to execute through a challenging retail environment,” said Cliff Sifford, Interim President and Chief Executive Officer. “Shoe Station continues to demonstrate industry-leading performance, and we enter Fiscal 2026 with a clear operational focus: disciplined inventory management, targeted store rebanner conversions where supported by our demographic data, and expense discipline. Our balance sheet provides the financial foundation to navigate near-term margin pressure while positioning the Company for improved profitability in Fiscal 2027 and beyond.”

Mr. Sifford continued, “Shoe Station remains our primary growth vehicle. Our evolving rebanner strategy will be driven by our CRM customer data, which allows us to identify the markets within our current footprint that are best suited to the Shoe Station format, while also guiding our pursuit of new market opportunities for Shoe Station beyond our existing footprint. In markets where Shoe Carnival has historically been the dominant family footwear retailer, those stores will continue to operate under the Shoe Carnival banner. Our unique merchandising strategy and industry-leading CRM data allow us to merchandise each banner according to the preferences of each store’s customer base.”

Fourth Quarter 2025 Operating Results

Net sales in the fourth quarter of Fiscal 2025 were $254.1 million, near the midpoint of the Company's guidance range, compared to $262.9 million in the fourth quarter of Fiscal 2024. Comparable store sales declined 3.5 percent.

By banner:

• Shoe Station net sales were approximately flat compared to the fourth quarter of Fiscal 2024, with a low-single digit comparable store sales decline.
• Shoe Carnival net sales declined 4.5 percent, with a mid-single digit comparable store sales decline, reflecting continued pressure on lower-income consumers and a reduction in promotional marketing.
• Rogan's generated net sales of $15.5 million with product margin expansion of more than 500 basis points, as those operations were fully integrated into the Shoe Station operating model.

Gross profit margin in the fourth quarter was 34.9 percent, approximately flat compared to the fourth quarter of Fiscal 2024. Merchandise margin expanded 30 basis points but was offset by deleverage in buying, distribution, and occupancy costs.

Net income was $9.1 million, or $0.33 per diluted share (“EPS”), exceeding consensus expectations. The Company estimates rebanner investments reduced fourth quarter EPS by approximately $0.08, primarily impacting selling, general and administrative expenses.

Fiscal Year 2025 Operating Results

Net sales for Fiscal 2025 were $1.135 billion, a decrease of 5.6 percent compared to Fiscal 2024, including a comparable store sales decline of 5.6 percent. The Shoe Carnival net sales decline of 7.7 percent was the primary driver.

Shoe Station net sales were $236.7 million in Fiscal 2025, representing 21 percent of total net sales, and grew organically 2.7 percent compared to Fiscal 2024, inclusive of a low-single digit comparable store sales increase. Shoe Station's net sales growth outperformed the family footwear industry and exceeded Shoe Carnival's performance by 10.4 percentage points.

Fiscal 2025 gross profit margin was 36.6 percent, marking the fifth consecutive year gross profit margin has exceeded 35 percent. The 100 basis point improvement compared to Fiscal 2024 was driven by disciplined pricing, favorable mix shift toward Shoe Station's higher-income consumer, and deliberate inventory management decisions made in anticipation of tariff cost increases.

Net income for Fiscal 2025 was $52.3 million, or $1.90 per diluted share, compared to $73.8 million, or $2.68 per diluted share, in Fiscal 2024. The Company estimates EPS included a negative impact of approximately $0.66 from rebanner investments in Fiscal 2025.

Capital Management and Cash Flow

Fiscal 2025 marked the 21st consecutive fiscal year the Company ended with no debt, fully funding operations and strategic investments from operating cash flow. At the end of Fiscal 2025, the Company held approximately $130.7 million in cash, cash equivalents, and marketable securities, an increase of 6 percent compared to the end of Fiscal 2024.

Merchandise inventories at the end of Fiscal 2025 were $439.6 million, up approximately 14 percent compared to the end of Fiscal 2024. Inventory levels increased during Fiscal 2025 through opportunistic pre-tariff buys of seasonal and in-demand merchandise. These purchases supported merchandise margin expansion in Fiscal 2025 and are expected to continue supporting margins as this inventory is sold in Fiscal 2026, partially offsetting the impact of higher tariff-affected product costs.

Dividend and Share Repurchase Program

In March 2026, the Board of Directors approved a dividend increase to $0.17 per share, payable April 20, 2026 to shareholders of record as of April 6, 2026. This represents the 12th consecutive year the Company has increased its quarterly dividend. The new annualized rate represents a compounded annual growth rate of approximately 15.5 percent over the past 12 years. The Company has now paid a dividend for 56 consecutive quarters.

As of March 26, 2026, $50 million remained available under the Company's share repurchase authorization. No shares were repurchased during Fiscal 2025.

Banner Strategy Update

On November 13, 2025, the Company announced that its Board of Directors unanimously approved changing the corporate name to Shoe Station Group, Inc., subject to shareholder approval at the Annual Meeting of Shareholders in June 2026. That proposed name change remains on the June 2026 agenda. The proposed corporate name change to Shoe Station Group, Inc. reflects the Board's conviction that the Shoe Station concept is the Company's primary long-term growth vehicle.

At the end of Fiscal 2025, Shoe Station represented 144 stores and 34 percent of the Company's 426-store fleet, up from 10 percent of the fleet at the start of Fiscal 2025.

Fiscal 2025 marked the first large-scale deployment of the Company’s rebanner program, with 101 store rebanners completed beyond the initial 10-store test conducted in Fiscal 2024. In evaluating the performance of those 101 stores, particularly Net Sales in the second-half of Fiscal 2025, the Company observed that, while Shoe Station's e-commerce results have been a meaningful contributor to banner-level sales growth, demonstrating strong consumer response to the Shoe Station brand and assortment online, there was significant variability in in-store performance across rebannered locations, with some stores performing well and others not achieving anticipated results.

As a result, the Company is making the strategic decision to slow the pace of store rebanners in Fiscal 2026 from its previously announced timelines to allow time to identify which consumer demographics are responding most favorably to the Shoe Station format, to determine which marketing channels are most effective in driving new customer acquisition, and to refine product mix in rebannered stores to improve in-store conversion. The Company now expects to rebanner approximately 21 stores during the first half of Fiscal 2026 while this evaluation is conducted.

Record Date and Date of Annual Shareholder Meeting

The Company announced that April 13, 2026, has been set as the shareholder of record date and the Annual Meeting of Shareholders will be held on June 10, 2026.

Fiscal 2026 Guidance

The following guidance reflects the Company's current expectations for Fiscal 2026 and incorporates the revised rebanner plan, anticipated tariff cost increases, and the Company's deliberate inventory reduction strategy.

• Net sales: approximately down 1 percent to up 1 percent compared to Fiscal 2025, reflecting comparable store sales declines in the first half offset by improvement in the second half as 21 planned rebanners are completed and Shoe Station's growth continues.
• Gross profit margin: approximately 34 percent, a decline of approximately 260 basis points compared to Fiscal 2025. This reflects three factors: (1) tariff-related cost increases flowing through the cost of sales as pre-tariff inventory is sold and replaced with higher-cost goods; (2) the non-recurrence of the temporary price increase benefit realized in Fiscal 2025 when prices were raised in advance of cost increases; and (3) increased promotional activity required to improve inventory turns and reduce elevated inventory levels. The Company notes that Fiscal 2025 gross margins were elevated relative to the prior multi-year trend due to the timing of the temporary price increase benefit.
• Adjusted SG&A expenses: expected to decrease approximately $12 to $14 million versus Fiscal 2025, reflecting lower rebanner-related costs associated with the reduced rebanner conversion program and continued operational cost discipline. ⁽¹⁾
• Adjusted EPS: expected in a range of $1.40 to $1.60. ⁽¹⁾

The Company expects the first half of Fiscal 2026 to be more challenging, with comparable store sales improvement and the benefit of completed rebanners expected to contribute to better results in the second half of the year.

Conference Call

Today, at 9:00 a.m. Eastern Time, the Company will host a conference call to discuss its fourth quarter and full year Fiscal 2025 results and Fiscal 2026 guidance. Participants may listen to the live webcast by visiting the Investors section of the Company's website at www.shoecarnival.com. A replay of the webcast will be available on the Company's website beginning approximately two hours after the call concludes and will be archived for one year.

About Shoe Carnival

Shoe Carnival, Inc. is one of the nation's largest family footwear retailers, offering a broad assortment of dress, casual, and athletic footwear for men, women, and children with emphasis on national name brands. As of March 26, 2026, the Company operated 426 stores in 35 states and Puerto Rico under its Shoe Carnival and Shoe Station banners and offers shopping at www.shoecarnival.com and www.shoestation.com. Headquartered in Fort Mill, SC, and with distribution and support operations located in Evansville, IN, Shoe Carnival, Inc. trades on The Nasdaq Stock Market LLC under the symbol SCVL.

Forward-Looking Non-GAAP Financial Measures

This press release and the Company’s commentary in its earnings conference call today include adjusted earnings per diluted share (“Adjusted EPS”) and adjusted selling, general and administrative expense (“Adjusted SG&A”) guidance for Fiscal 2026. Adjusted EPS and Adjusted SG&A are non-GAAP financial measures that are based on the Company’s internal forecasts and exclude certain items related to the Company’s recent CEO transition that would be included in GAAP financial measures, including CEO separation costs and related tax effects that are expected to be in a range of $0.20 to $0.22 per diluted share ($5 million on a pre-tax basis) and other related CEO transition costs that are not considered indicative of the Company’s ongoing operating performance. These other CEO transition costs may include, but are not limited to, other costs associated with executive leadership transitions, restructuring charges, asset impairments and store closure costs, discrete tax items related to costs incurred, and changes in the shares included in earnings per diluted share calculations. The Company has not provided quantitative reconciliations of forward-looking Adjusted EPS and Adjusted SG&A to the most directly comparable forward-looking GAAP financial measures, earnings per diluted share and selling, general and administrative expense, respectively, because the excluded items are not available on a prospective basis without unreasonable efforts. This is due to the inherent difficulty of forecasting the occurrence, timing, and amount of other costs that have not yet occurred or cannot be reasonably predicted. It is probable that these forward-looking non-GAAP financial measures may be materially different from the corresponding GAAP financial measures.

Cautionary Statement Regarding Forward-Looking Information

As used herein, “we”, “our” and “us” refer to Shoe Carnival, Inc. 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, such as statements about our future growth, our banner strategy, operations, cash flows and shareholder returns.

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: our ability to achieve expected operating results from, and planned growth of, our Shoe Station banner, including our ability to increase our comparable stores Net Sales from rebannering Shoe Carnival locations into Shoe Station locations and our ability to achieve expected cost savings, synergies, and inventory reductions from operating more Shoe Station stores, within expected time frames, or at all; the impact of competition and pricing, including our ability to maintain current promotional intensity levels; changes in the political and economic environments in, the status of trade relations with, and the impact of changes in trade policies and tariffs impacting China and other countries that are the major manufacturers of footwear; our ability to control costs and meet our labor needs in a rising wage, inflationary, and/or supply chain constrained environment; cost and uncertainty associated with our CEO transition; the effects and duration of economic downturns and unemployment rates; the potential impact of national and international security concerns, including those caused by war and terrorism, on the retail environment; general economic conditions, such as gasoline and energy prices and interest rates, in the areas of the continental United States and Puerto Rico where our stores are located; changes in the overall retail environment and more specifically in the apparel and footwear retail sectors; our ability to successfully utilize the e-commerce sales channel and its impact on traffic and transactions in our physical stores; the success of the open-air shopping centers where many of our stores are located and the impact on our ability to attract customers to our stores; our ability to attract customers to our e-commerce platform and to successfully grow our omnichannel sales; the effectiveness of our inventory management, including our ability to manage key merchandise vendor relationships and direct-to-consumer initiatives; changes in our relationships with other key suppliers; our ability to successfully manage and execute our marketing initiatives and maintain positive brand perception and recognition; our ability to successfully manage our current real estate portfolio and leasing obligations; changes in weather, including patterns impacted by climate change; changes in 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 including at our distribution center located in Evansville, IN; the impact of natural disasters, public health and political crises, civil unrest, and other catastrophic events on our operations and the operations of our suppliers, as well as on consumer confidence and purchasing in general; the duration and spread of a public health crisis and the mitigating efforts deployed, including the effects of government stimulus on consumer spending; risks associated with the seasonality of the retail industry; the impact of unauthorized disclosure or misuse of personal and confidential information about our customers, vendors and employees, including as a result of a cybersecurity breach; our ability to effectively achieve the operating results from, and maintain the synergies, efficiencies and other benefits gained through, our acquisition strategy; our ability to successfully execute our business strategy, including the availability of desirable store locations at acceptable lease terms, our ability to identify, consummate or effectively integrate future acquisitions, our ability to implement and adapt to new technology and systems, our ability to open new stores in a timely and profitable manner, including our entry into major new markets, and the availability of sufficient funds to implement our business plans; higher than anticipated costs associated with the closing of underperforming stores; the inability of manufacturers to deliver products in a timely manner; an increase in the cost, or a disruption in the flow, of imported goods; the impact of regulatory changes in the United States, including minimum wage laws and regulations, and the countries where our manufacturers are located; the resolution of litigation or regulatory proceedings in which we are or may become involved; continued volatility and disruption in the capital and credit markets; future stock repurchases under our stock repurchase program and future dividend payments; and other factors described in the Company’s SEC filings, including the Company’s latest Annual Report on Form 10-K. 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,” “aims,” “on track,” “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.

Financial Tables Follow

FORT MILL, S.C.--(BUSINESS WIRE)-- Shoe Carnival, Inc. (Nasdaq: SCVL) (the “Company”), a leading retailer of footwear and accessories for the family, today reported results for the third quarter ended November 1, 2025, updated its Fiscal 2025 outlook, and provided expected impacts from its One Banner Strategy.

Third Quarter 2025 Highlights

• EPS of $0.53 and net sales of $297.2 million exceeded consensus expectations.
• Shoe Station net sales grew 5.3 percent; Shoe Station product margins expanded 260 basis points.
• Progressing toward one brand and simplified structure; well over 90 percent of fleet to operate as Shoe Station before the end of Fiscal 2028.

“Third quarter results exceeded expectations. Shoe Station is winning - up over 5 percent in sales with 260 basis point margin expansion. We’re consolidating to one brand because the performance gap is undeniable. Over time, this unlocks $20 million in savings and $100 million in working capital to fund growth from our debt-free balance sheet,” said Mark Worden, President and Chief Executive Officer.

Third Quarter 2025 Operating Results

Net sales of $297.2 million exceeded consensus expectations and compared to $306.9 million in third quarter 2024. Comparable store sales declined 2.7 percent.

By banner, third quarter 2025 performance continued to highlight the strength of the One Banner Strategy announced on November 13, 2025:

• Shoe Station net sales grew 5.3 percent, inclusive of a mid-single digit comparable store increase.
• Shoe Carnival net sales declined 5.2 percent with comparable store sales down mid-single digits, as lower-income consumers remained pressured.
• Rogan’s generated more than $21 million in net sales, consistent with integration plans.

Gross profit margin was 37.6 percent, expanding 160 basis points compared to the prior year. Merchandise margin improved 190 basis points, driven by disciplined pricing, favorable mix shift toward higher income Shoe Station customers, and strategic inventory investments. These gains more than offset approximately 30 basis points of deleverage in buying, distribution, and occupancy costs.

Gross profit increased to $111.8 million from $110.4 million in the prior year, driven by Shoe Station growth and disciplined pricing across all banners.

Net income was $14.6 million, or $0.53 per diluted share (“EPS”), compared to $19.2 million, or $0.70 per diluted share, in the prior year period. The Company estimates EPS included a negative impact of approximately $0.22 from rebanner investments in third quarter 2025 and approximately $0.58 per share year-to-date in Fiscal 2025.

Fiscal 2025 Outlook

The Company reaffirmed its Fiscal 2025 net sales outlook and updated its EPS outlook following strong third quarter results and accelerated rebanner execution. The Company now expects EPS for Fiscal 2025 in a range of $1.80 to $2.10, an increase in the lower end of the range of $0.10.

Balance Sheet and Liquidity

The Company ended third quarter 2025 debt-free, and cash, cash equivalents, and marketable securities totaled $107.7 million at quarter end, an increase of 18.2 percent compared to the prior year.

Consistent with the past 20 consecutive years, the Company fully funded its operations and growth investments from operating cash flow and cash reserves. The Company expects to continue generating ample liquidity to self-fund the One Banner Strategy and support other strategic opportunities.

Year-to-date capital expenditures totaled $38.3 million, primarily supporting rebannered stores.

The Company had $50 million remaining under its existing share repurchase authorization.

One Banner Strategy Update

On November 13, 2025, the Company announced its Board of Directors unanimously approved changing the corporate name to Shoe Station Group, Inc. The name change is subject to shareholder approval at the Annual Meeting in June 2026.

As of November 20, 2025, Shoe Station represents 144 stores and 34 percent of the Company’s 428-store fleet, up from 10 percent at the start of Fiscal 2025. The Company completed integration of its 28-store Rogan’s acquisition into the Shoe Station banner in October 2025. Beginning in fourth quarter 2025, Rogan’s results will be reported as part of Shoe Station.

The Company is on track to operate 215 Shoe Station stores by Back-to-School 2026, representing 51 percent of the fleet. The Company expects well over 90 percent of its fleet to operate as Shoe Station before the end of Fiscal 2028, with remaining locations evaluated for rebannering, outlet repositioning, or closure.

One Banner Strategy Timeline and Expected Impacts

Expected Benefits by End of Fiscal 2027

The Company’s transition to Shoe Station as the primary operating banner is expected to deliver significant value:

• $20 million in annual cost savings from reduced dual-brand complexity across merchandising, marketing, systems, supply chain, and back office.
• $100 million reduction in inventory investment (20-25 percent) as Shoe Station's merchandising model requires less inventory per store to deliver a superior customer experience.
• Return to comparable store sales growth as Shoe Station becomes the dominant banner.
• EPS growth as cost savings are captured, rebanner investments moderate, and sales growth resumes. Growth is expected to accelerate into Fiscal 2028 as the One Banner Strategy nears completion.

Fiscal 2026: Investment Required to Capture Long Term Benefits

To reach the critical 51 percent Shoe Station threshold by Back-to-School 2026, the Company expects to rebanner 70 stores, requiring capital expenditures of $25 to $35 million and rebanner investment of $25 to $30 million. This rebanner investment includes lost sales, store closing costs, including inventory liquidation, additional depreciation, customer acquisition costs and other costs. The Company continues to expect payback of this rebanner investment within two to three years following each store’s conversion.

In Fiscal 2026, the Company expects net sales to decline low-to-mid single digits in the first half before returning to flat-to-low single digit growth in the second half as Shoe Station surpasses 51 percent of the fleet. The Company expects EPS in Fiscal 2026 will be lower than Fiscal 2025 due to lower sales and rebanner investments. Approximately $50 to $60 million in inventory reduction is expected in Fiscal 2026, which more than fully funds the rebanner capital expenditures.

Conference Call

Today, at 9:00 a.m. Eastern Time, the Company will host a conference call to discuss its third quarter results. Participants can listen to the live webcast of the call by visiting Shoe Carnival's Investors webpage 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 the Company’s website beginning approximately two hours after the conclusion of the conference call and will be archived for one year.

About Shoe Carnival

Shoe Carnival, Inc. is one of the nation’s largest family footwear retailers, offering a broad assortment of dress, casual and athletic footwear for men, women and children with emphasis on national name brands. As of November 20, 2025, the Company operated 428 stores in 35 states and Puerto Rico under its Shoe Carnival and Shoe Station banners and offers shopping at www.shoecarnival.com and www.shoestation.com. Headquartered in Fort Mill, SC, and with distribution and support operations located in Evansville, IN, Shoe Carnival, Inc. trades on The Nasdaq Stock Market LLC under the symbol SCVL.

Press releases and annual reports are available on the Company's website at www.shoecarnival.com.

Cautionary Statement Regarding Forward-Looking Information

As used herein, “we”, “our” and “us” refer to Shoe Carnival, Inc. 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, such as statements about our future growth, operations, cash flows and shareholder returns.

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: our ability to increase our comparable stores net sales and achieve expected operating results from rebannering Shoe Carnival locations into Shoe Station locations within expected time frames, or at all; our ability to achieve expected operating results from, and planned growth of, our Shoe Station banner, including expected cost savings, synergies and inventory reductions from operating principally under one banner, within expected time frames, or at all; the impact of competition and pricing, including our ability to maintain current promotional intensity levels; changes in the political and economic environments in, the status of trade relations with, and the impact of changes in trade policies and tariffs impacting, China and other countries which are the major manufacturers of footwear; our ability to control costs and meet our labor needs in a rising wage, inflationary, and/or supply chain constrained environment; the effects and duration of economic downturns and unemployment rates; the potential impact of national and international security concerns, including those caused by war and terrorism, on the retail environment; general economic conditions in the areas of the continental United States and Puerto Rico where our stores are located; changes in the overall retail environment and more specifically in the apparel and footwear retail sectors; our ability to successfully utilize the e-commerce sales channel and its impact on traffic and transactions in our physical stores; the success of the open-air shopping centers where many of our stores are located and the impact on our ability to attract customers to our stores; our ability to attract customers to our e-commerce platform and to successfully grow our omnichannel sales; the effectiveness of our inventory management, including our ability to manage key merchandise vendor relationships and direct-to-consumer initiatives; changes in our relationships with other key suppliers; our ability to successfully manage and execute our marketing initiatives and maintain positive brand perception and recognition; our ability to successfully manage our current real estate portfolio and leasing obligations; changes in weather, including patterns impacted by climate change; changes in 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 including at our distribution center located in Evansville, IN; the impact of natural disasters, public health and political crises, civil unrest, and other catastrophic events on our operations and the operations of our suppliers, as well as on consumer confidence and purchasing in general; the duration and spread of a public health crisis and the mitigating efforts deployed, including the effects of government stimulus on consumer spending; risks associated with the seasonality of the retail industry; the impact of unauthorized disclosure or misuse of personal and confidential information about our customers, vendors and employees, including as a result of a cybersecurity breach; our ability to effectively achieve the operating results from, and maintain the synergies, efficiencies and other benefits gained through, our acquisition strategy, including our recent acquisition of Rogan’s; our ability to successfully execute our business strategy, including the availability of desirable store locations at acceptable lease terms, our ability to identify, consummate or effectively integrate future acquisitions, our ability to implement and adapt to new technology and systems, our ability to open new stores in a timely and profitable manner, including our entry into major new markets, and the availability of sufficient funds to implement our business plans; higher than anticipated costs associated with the closing of underperforming stores; the inability of manufacturers to deliver products in a timely manner; an increase in the cost, or a disruption in the flow, of imported goods; the impact of regulatory changes in the United States, including minimum wage laws and regulations, and the countries where our manufacturers are located; the resolution of litigation or regulatory proceedings in which we are or may become involved; continued volatility and disruption in the capital and credit markets; future stock repurchases under our stock repurchase program and future dividend payments; and other factors described in the Company’s SEC filings, including the Company’s latest Annual Report on Form 10-K. 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,” “aims,” “on track,” “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.

Financial Tables Follow

FORT MILL, S.C.--(BUSINESS WIRE)-- Shoe Carnival, Inc. (Nasdaq: SCVL) (the “Company”), a leading retailer of footwear and accessories for the family, today reported results for the second quarter ended August 2, 2025 and updated its Fiscal 2025 outlook.

Second Quarter Fiscal 2025 and Back-to-School Highlights

• Delivered $0.70 EPS, beating consensus by over 20 percent.
• Expanded gross profit margin 270 basis points to 38.8 percent.
• Achieved positive comparable sales and margin expansion during August Back-to-School.
• Shoe Station rebanner strategy delivered 8 percent comparable sales growth through year-to-date August.
• Grew cash double digits through fiscal August with zero debt, positioned to fund growth.

“Our second quarter results demonstrate meaningful progress, with profits beating consensus by double digits and gross margins reaching 38.8 percent - our strongest Q2 margin performance in years,” said Mark Worden, President and Chief Executive Officer. “As we moved into Back-to-School in early August, our execution hit a higher level. We delivered positive comparable store sales for the Company and margin expansion across all banners during the period that drives approximately 25 percent of our annual profits. This return to growth during our highest-stakes season - ahead of our projected timeline - validates that our transformation is accelerating.”

Worden continued, “Our rebanner strategy continues to deliver strong results. Through year-to-date August, the Shoe Station banner is outperforming the Shoe Carnival banner by a wide margin, with margins up sharply over last year. Our debt-free balance sheet with strong cash reserves allows us to invest aggressively in this proven model while remaining ready for strategic opportunities. By Back-to-School 2026, Shoe Station will be our majority concept, positioning us for sustained growth with a higher-income customer base, stronger margins, and improved returns.”

Shoe Station Growth Strategy

As of August 2, 2025, the Company operated 428 stores: 313 Shoe Carnival stores, 87 Shoe Station stores, and 28 Rogan's stores. The Shoe Station store count has more than doubled since second quarter 2024.

The Company completed 20 rebanner conversions during second quarter 2025, bringing year-to-date conversions to 44 stores. An additional 58 stores are expected to rebanner in the second half of fiscal 2025 (29 in third quarter and 29 in fourth quarter), bringing the total to 145 Shoe Station stores by year-end - representing 34 percent of the fleet. This positions the Company to surpass 215 Shoe Station stores by Back-to-School 2026, achieving the critical 51 percent threshold where expected portfolio growth overtakes legacy declines.

The rebanner strategy delivered strong financial returns through year-to-date August compared to the same period last year including:

• Comparable sales increasing high-single digits.
• Rebanner margins expanding 270 basis points.

First-year rebanner investments of approximately $25 million are expected to impact fiscal 2025 operating income, with $0.36 of EPS impact incurred year-to-date. Payback of these investments is expected within two to three years.

Second Quarter Operating Results

Gross profit margin reached 38.8 percent in second quarter 2025, expanding 270 basis points from 36.1 percent in the prior year. This margin expansion demonstrated the power of the Company's rebanner strategy. Merchandise margin improved 390 basis points driven by disciplined pricing across all banners, a favorable mix shift toward merchandise preferred by Shoe Station's higher-income customers, and strategic inventory investments. This more than offset 120 basis points of deleverage in buying, distribution and occupancy costs.

Net sales were $306.4 million compared to $332.7 million in second quarter 2024, a decrease of 7.9 percent. Comparable sales declined 7.5 percent, including a high-single digit decline at Shoe Carnival and break-even results at Shoe Station.

By banner, second quarter 2025 divergent trends reinforced the rebanner strategy:

• Shoe Station net sales grew 1.6 percent.
• Shoe Carnival net sales declined 10.1 percent as the sub-$40,000 income consumer remained pressured.
• Rogan's exceeded $20 million in net sales, in line with integration plans.

Net income was $19.2 million, or $0.70 per diluted share (“EPS”), compared to $22.6 million, or $0.82 per diluted share in the prior year. The Company estimates second quarter 2025 EPS included a $0.21 negative impact from rebanner investments while first quarter 2025 EPS included a $0.15 negative impact.

The rebanner investments in second quarter 2025 included an estimated 1 percent decline in net sales from stores temporarily closed during rebanner conversions and a 2 percent increase in selling, general and administrative expenses (“SG&A”) as a percent of net sales for store closing costs, additional depreciation, customer acquisition costs and other costs.

Back-to-School Performance Update

Fiscal August performance accelerated significantly, with the Company achieving positive comparable sales versus prior year - a significant improvement from second quarter trends and ahead of the Company's projected timeline for returning to growth.

By banner, fiscal August delivered strong results:

• Shoe Station grew comparable sales high-single digits, driven by high-single digit growth in the children's category and low-twenties growth in the adult athletics category with margin expansion.
• Shoe Carnival achieved positive children's category comparable sales with margin growth while maintaining discipline in other categories.
• Rogan's also achieved comparable sales growth, in line with integration plans.

Balance Sheet Strength

The Company ended second quarter 2025 debt-free, and consistent with the last 20 consecutive years, fully funded its operations and growth investments from operating cash flow. Cash, cash equivalents and marketable securities totaled $91.9 million.

Inventory increased 5 percent versus prior year, a strategic investment that delivered significantly improved availability on key items during Back-to-School. This availability directly contributed to margin expansion and sales capture during this peak selling period. The Company expects inventory levels to normalize during 2026 as supply chain visibility improves.

Capital expenditures totaled $24.4 million year-to-date, primarily for the 44 completed rebanner conversions. The Company has $50 million remaining under its share repurchase authorization.

The Company had approximately $148 million in cash, cash equivalents, and marketable securities as of August fiscal month end, an increase of over 10 percent compared to the same time last year. This increase was largely due to a successful August Back-to-School that generated over $55 million in cash, providing ample liquidity for continued rebanner investments and strategic opportunities.

Fiscal 2025 Outlook

Based on second quarter results exceeding market expectations, Back-to-School results, and rebanner momentum continuing, the Company now expects the following for fiscal 2025:

• Net Sales: $1.12 billion to $1.15 billion, compared to the previous range of $1.15 billion to $1.23 billion.
• GAAP EPS: $1.70 to $2.10, an increase in the lower end of the range of $0.10.
• Gross Profit Margin: 36.5 percent to 37.5 percent, a 150-basis point increase.
• SG&A: $355 million to $360 million, inclusive of increased rebanner investment.
• Capital Expenditures: $45 to $55 million, inclusive of $30 to $35 million for rebanners.

The Company’s outlook anticipates that sales declines will slow in the second half of the year, with the midpoint implying a 3 percent decline versus the 7.7 percent year-to-date decline. This improvement reflects the rebanner strategy's momentum and strong event period performance, including August's positive comparable sales. As Shoe Station grows, the Company expects its gains will increasingly offset Shoe Carnival's challenges. The wide EPS range reflects macro uncertainty and expected traffic volatility outside key selling periods.

Conference Call

Today, at 9:00 a.m. Eastern Time, the Company will host a conference call to discuss its second quarter results. Participants can listen to the live webcast of the call by visiting Shoe Carnival's Investors webpage 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 the Company's website beginning approximately two hours after the conclusion of the conference call and will be archived for one year.

About Shoe Carnival

Shoe Carnival, Inc. is one of the nation's largest family footwear retailers, offering a broad assortment of dress, casual and athletic footwear for men, women and children with emphasis on national name brands. As of September 4, 2025, the Company operated 428 stores in 35 states and Puerto Rico under its Shoe Carnival, Shoe Station and Rogan's store fronts and offers shopping at www.shoecarnival.com and www.shoestation.com. Headquartered in Fort Mill, SC, and with distribution and support operations located in Evansville, IN, Shoe Carnival, Inc. trades on The Nasdaq Stock Market LLC under the symbol SCVL.

Press releases and annual reports are available on the Company's website at www.shoecarnival.com.

Cautionary Statement Regarding Forward-Looking Information

As used herein, “we,” “our” and “us” refer to Shoe Carnival, Inc. 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, such as statements about our future growth, operations, cash flows and shareholder returns.

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: our ability to increase our comparable stores Net Sales and achieve expected operating results from rebannering Shoe Carnival locations into Shoe Station locations within expected time frames, or at all; our ability to achieve expected operating results from, and planned growth of, our Shoe Station banner within expected time frames, or at all; the impact of competition and pricing, including our ability to maintain current promotional intensity levels; changes in the political and economic environments in, the status of trade relations with, and the impact of changes in trade policies and tariffs impacting, China and other countries which are the major manufacturers of footwear; our ability to control costs and meet our labor needs in a rising wage, inflationary, and/or supply chain constrained environment; the effects and duration of economic downturns and unemployment rates; the potential impact of national and international security concerns, including those caused by war and terrorism, on the retail environment; general economic conditions in the areas of the continental United States and Puerto Rico where our stores are located; changes in the overall retail environment and more specifically in the apparel and footwear retail sectors; our ability to successfully utilize the e-commerce sales channel and its impact on traffic and transactions in our physical stores; the success of the open-air shopping centers where many of our stores are located and the impact on our ability to attract customers to our stores; our ability to attract customers to our e-commerce platform and to successfully grow our omnichannel sales; the effectiveness of our inventory management, including our ability to manage key merchandise vendor relationships and direct-to-consumer initiatives; changes in our relationships with other key suppliers; our ability to successfully manage and execute our marketing initiatives and maintain positive brand perception and recognition; our ability to successfully manage our current real estate portfolio and leasing obligations; changes in weather, including patterns impacted by climate change; changes in 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 including at our distribution center located in Evansville, IN; the impact of natural disasters, public health and political crises, civil unrest, and other catastrophic events on our operations and the operations of our suppliers, as well as on consumer confidence and purchasing in general; the duration and spread of a public health crisis and the mitigating efforts deployed, including the effects of government stimulus on consumer spending; risks associated with the seasonality of the retail industry; the impact of unauthorized disclosure or misuse of personal and confidential information about our customers, vendors and employees, including as a result of a cybersecurity breach; our ability to effectively achieve the operating results from, and maintain the synergies, efficiencies and other benefits gained through, our acquisition strategy, including our recent acquisition of Rogan’s; our ability to successfully execute our business strategy, including the availability of desirable store locations at acceptable lease terms, our ability to identify, consummate or effectively integrate future acquisitions, our ability to implement and adapt to new technology and systems, our ability to open new stores in a timely and profitable manner, including our entry into major new markets, and the availability of sufficient funds to implement our business plans; higher than anticipated costs associated with the closing of underperforming stores; the inability of manufacturers to deliver products in a timely manner; an increase in the cost, or a disruption in the flow, of imported goods; the impact of regulatory changes in the United States, including minimum wage laws and regulations, and the countries where our manufacturers are located; the resolution of litigation or regulatory proceedings in which we are or may become involved; continued volatility and disruption in the capital and credit markets; future stock repurchases under our stock repurchase program and future dividend payments; and other factors described in the Company’s SEC filings, including the Company’s latest Annual Report on Form 10-K. 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,” “aims,” “on track,” “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.

Financial Tables Follow