St. Louis -- Brown Shoe Co. said Monday that while profit rose dramatically in the third quarter thanks to a business unit divestiture, the retailer will cut several of its lines and close underperforming stores nationwide to shore up profitability.
On Monday, the parent of Famous Footwear said it will close between 70 and 75 Famous Footwear stores in fiscal 2011 and 2012, for a total of about 145 store closures. The company will also be closing all of its Brown Shoe Closet and F.X. LaSalle stores, and will exit several business units including all of its children's wholesale and some women's specialty and private brands.
The company reported net income of $33.7 million in the third quarter, up from $18.6 million a year earlier and meeting analysts’ expectations.
Total revenue dipped to $713.8 million from $716.1 million, widely missing Wall Street’s expected $779.1 million. Famous Footwear sales fell 1.3%. Overall same-store sales fell 0.4% after a strong 11% gain in the prior year.
In an effort to offset reduced consumer spending, Brown Shoe had already closed some underperforming stores, a distribution center and divested its men's basketball and lifestyle shoe brand And 1.
"While our efforts to date have been focused on eliminating underperforming or poorly aligned assets, this is not our sole focus," Diane Sullivan, president and CEO, said in a statement. "We are determined to expand our portfolio over the long-term and to deliver enhanced growth through our focus on the strategic consumer platforms of family, healthy living and contemporary fashion."
The company also said it has agreed to license its Buster Brown, Sam Edelman and Avia wholesale children's brands to global footwear firm BBC International.