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Includes approximately $0.5 million of expense related to a valuation allowance on net deferred taxes, including those related to other comprehensive income, for the Company's Canadian subsidiary. Amounts reclassified are included in other income, net. Refer to Note 13 to the condensed consolidated financial statements for additional information related to pension and other postretirement benefits. 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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

(Mark One)

   

Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the quarterly period ended August 1, 2020

 

 

 

 

Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the transition period from  _____________  to  _____________

 

 

Commission file number: 1-2191

 

CALERES, INC.

(Exact name of registrant as specified in its charter)

 

 

New York

(State or other jurisdiction

of incorporation or organization)

43-0197190

(IRS Employer Identification Number)

 

 

8300 Maryland Avenue

St. Louis, Missouri

(Address of principal executive offices)

63105

(Zip Code)

(314) 854-4000

(Registrant's telephone number, including area code)

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock - par value of $0.01 per share

CAL

New York Stock Exchange

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  ☑  No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  ☑   No ☐ 

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company," and "emerging growth company” in Rule 12b-2 of the Exchange Act:

 

Large accelerated filer

Accelerated filer ☐

Non-accelerated filer ☐

Smaller reporting company

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   

Yes       No ☑ 

 

As of August 28, 2020, 37,912,156 common shares were outstanding.

 

1

 

 

 

INDEX

 

 

PART I

 

Page

Item 1

Financial Statements

3

Item 2

Management's Discussion and Analysis of Financial Condition and Results of Operations

25

Item 3

Quantitative and Qualitative Disclosures About Market Risk

36

Item 4

Controls and Procedures

36

 

 

 

PART II

 

 

Item 1

Legal Proceedings

37

Item 1A

Risk Factors

37

Item 2

Unregistered Sales of Equity Securities and Use of Proceeds

37

Item 3

Defaults Upon Senior Securities

37

Item 4

Mine Safety Disclosures

37

Item 5

Other Information

37

Item 6

Exhibits

38

 

Signature

39

 

2

Table of Contents

 

PART I

FINANCIAL INFORMATION

   

ITEM 1

FINANCIAL STATEMENTS

 

 

CALERES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

  

(Unaudited)

     

($ thousands)

 

August 1, 2020

  

August 3, 2019

  

February 1, 2020

 

Assets

            

Current assets:

            
Cash and cash equivalents $148,544  $42,601  $45,218 
Receivables, net  110,249   167,727   162,181 
Inventories, net  574,830   792,064   618,406 
Income taxes  52,658   2,896   6,189 
Prepaid expenses and other current assets  43,768   48,498   50,305 

Total current assets

  930,049   1,053,786   882,299 
             
Other assets  84,054   78,861   79,654 
Deferred income taxes  9,456   10,176   9,735 
Goodwill  4,956   245,275   245,275 
Intangible assets, net  265,405   300,835   294,304 
Lease right-of-use assets  624,881   723,415   695,594 
Property and equipment  558,567   589,885   593,979 
Allowance for depreciation  (364,974)  (357,840)  (369,133)

Property and equipment, net

  193,593   232,045   224,846 

Total assets

 $2,112,394  $2,644,393  $2,431,707 
             

Liabilities and Equity

            

Current liabilities:

            
Borrowings under revolving credit agreement $350,000  $300,000  $275,000 
Trade accounts payable  280,319   448,596   267,018 
Income taxes  8,310   11,110   7,186 
Lease obligations  171,247   143,202   127,869 
Other accrued expenses  208,024   179,221   173,877 

Total current liabilities

  1,017,900   1,082,129   850,950 
             

Other liabilities:

            
Noncurrent lease obligations  579,399   649,100   629,032 
Long-term debt  198,621   198,161   198,391 
Income taxes  7,786   7,786   7,786 
Deferred income taxes  13,051   46,573   55,013 
Other liabilities  50,503   35,966   41,405 

Total other liabilities

  849,360   937,586   931,627 
             

Equity:

            
Common stock  379   407   404 
Additional paid-in capital  156,913   149,881   153,489 
Accumulated other comprehensive loss  (31,437)  (31,405)  (31,843)
Retained earnings  116,385   504,546   523,900 

Total Caleres, Inc. shareholders’ equity

  242,240   623,429   645,950 
Noncontrolling interests  2,894   1,249   3,180 

Total equity

  245,134   624,678   649,130 

Total liabilities and equity

 $2,112,394  $2,644,393  $2,431,707 

 

See notes to condensed consolidated financial statements.

 

3

Table of Contents

 

 

CALERES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)

 

   

(Unaudited)

   

Thirteen Weeks Ended

   

Twenty-Six Weeks Ended

 

($ thousands, except per share amounts)

 

August 1, 2020

   

August 3, 2019

   

August 1, 2020

   

August 3, 2019

 
Net sales   $ 501,448     $ 752,485     $ 898,632     $ 1,430,239  
Cost of goods sold     318,828       446,541       594,114       844,459  

Gross profit

    182,620       305,944       304,518       585,780  
Selling and administrative expenses     201,331       267,531       426,524       529,642  
Impairment of goodwill and intangible assets                 262,719        
Restructuring and other special charges, net     5,429       609       65,625       1,465  

Operating (loss) earnings

    (24,140 )     37,804       (450,350 )     54,673  
Interest expense, net     (13,387 )     (7,389 )     (22,866 )     (14,729 )
Other income, net     3,672       2,650       7,257       5,269  

(Loss) earnings before income taxes

    (33,855 )     33,065       (465,959 )     45,213  
Income tax benefit (provision)     3,186       (7,838 )     89,118       (10,901 )

Net (loss) earnings

    (30,669 )     25,227       (376,841 )     34,312  
Net earnings (loss) attributable to noncontrolling interests     48       (114 )     (286 )     (112 )

Net (loss) earnings attributable to Caleres, Inc.

  $ (30,717 )   $ 25,341     $ (376,555 )   $ 34,424  
                                 
Basic (loss) earnings per common share attributable to Caleres, Inc. shareholders   $ (0.83 )   $ 0.61     $ (9.94 )   $ 0.83  
                                 
Diluted (loss) earnings per common share attributable to Caleres, Inc. shareholders   $ (0.83 )   $ 0.61     $ (9.94 )   $ 0.82  

 

See notes to condensed consolidated financial statements.

 

4

Table of Contents

 

 

CALERES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

 

   

(Unaudited)

 
   

Thirteen Weeks Ended

   

Twenty-Six Weeks Ended

 

($ thousands)

 

August 1, 2020

   

August 3, 2019

   

August 1, 2020

   

August 3, 2019

 

Net (loss) earnings

  $ (30,669 )   $ 25,227     $ (376,841 )   $ 34,312  

Other comprehensive income (loss), net of tax:

                               

Foreign currency translation adjustment

    740       (21 )     (810 )     (979 )

Pension and other postretirement benefits adjustments

    1,058       461       1,124       856  

Derivative financial instruments

          (5 )     92       298  

Other comprehensive income, net of tax

    1,798       435       406       175  

Comprehensive (loss) income

    (28,871 )     25,662       (376,435 )     34,487  

Comprehensive income (loss) attributable to noncontrolling interests

    67       (147 )     (286 )     (133 )

Comprehensive (loss) income attributable to Caleres, Inc.

  $ (28,938 )   $ 25,809     $ (376,149 )   $ 34,620  

 

See notes to condensed consolidated financial statements.

 

5

Table of Contents

 

 

CALERES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

   

(Unaudited)

 
   

Twenty-Six Weeks Ended

 

($ thousands)

 

August 1, 2020

   

August 3, 2019

 

Operating Activities

               

Net (loss) earnings

  $ (376,841 )   $ 34,312  

Adjustments to reconcile net (loss) earnings to net cash provided by operating activities:

               
Depreciation     21,875       22,957  
Amortization of capitalized software     2,939       3,293  
Amortization of intangible assets     6,499       6,524  
Amortization of debt issuance costs and debt discount     673       1,180  
Fair value adjustments to Blowfish mandatory purchase obligation     9,822       527  
Share-based compensation expense     4,401       6,542  
Loss on disposal of property and equipment     684       549  
Impairment charges for property, equipment, and lease right-of-use assets     35,222       2,954  
Impairment of goodwill and intangible assets     262,719        
Provision for expected credit losses     8,525       840  

Changes in operating assets and liabilities:

               
Receivables     41,275       23,155  
Inventories     43,372       (109,850 )
Prepaid expenses and other current and noncurrent assets     (94,670 )     (3,036 )
Trade accounts payable     13,399       135,321  
Accrued expenses and other liabilities     88,218       (8,134 )
Other, net     (592 )     (556 )

Net cash provided by operating activities

    67,520       116,578  
                 

Investing Activities

               
Purchases of property and equipment     (6,394 )     (26,741 )
Disposals of property and equipment           636  
Capitalized software     (2,220 )     (4,084 )

Net cash used for investing activities

    (8,614 )     (30,189 )
                 

Financing Activities

               
Borrowings under revolving credit agreement     250,500       149,000  
Repayments under revolving credit agreement     (175,500 )     (184,000 )
Dividends paid     (5,495 )     (5,808 )
Acquisition of treasury stock     (23,348 )     (29,995 )
Issuance of common stock under share-based plans, net     (973 )     (2,547 )
Other     (649 )     (694 )

Net cash provided by (used for) financing activities

    44,535       (74,044 )
Effect of exchange rate changes on cash and cash equivalents     (115 )     56  

Increase in cash and cash equivalents

    103,326       12,401  

Cash and cash equivalents at beginning of period

    45,218       30,200  

Cash and cash equivalents at end of period

  $ 148,544     $ 42,601  
 

 

See notes to condensed consolidated financial statements.

 

6

Table of Contents

 

 

CALERES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
              

Accumulated

                 
              

Other

      

Total Caleres, Inc.

  

Non-

     

(Unaudited)

 

Common Stock

  

Additional

  

Comprehensive

  

Retained

  

Shareholders’

  

controlling

     

($ thousands, except number of shares and per share amounts)

 

Shares

  

Dollars

  

Paid-In Capital

  

(Loss) Income

  

Earnings

  

Equity

  

Interests

  

Total Equity

 

BALANCE MAY 2, 2020

  39,299,990  $393  $154,930  $(33,216) $160,189  $282,296  $2,827  $285,123 
Net (loss) earnings                  (30,717)  (30,717)  48   (30,669)
Foreign currency translation adjustment              721       721   19   740 
Pension and other postretirement benefits adjustments, net of tax of $248              1,058       1,058       1,058 
Comprehensive income (loss)              1,779   (30,717)  (28,938)  67   (28,871)
Dividends ($0.07 per share)                  (2,685)  (2,685)      (2,685)
Acquisition of treasury stock  (1,391,234)  (14)          (10,402)  (10,416)      (10,416)
Issuance of common stock under share-based plans, net  3,400   -   (67)          (67)      (67)
Share-based compensation expense          2,050           2,050       2,050 

BALANCE AUGUST 1, 2020

  37,912,156  $379  $156,913  $(31,437) $116,385  $242,240  $2,894  $245,134 
                                 

BALANCE MAY 4, 2019

  42,233,845  $422  $146,641  $(31,873) $512,046  $627,236  $1,396  $628,632 
Net earnings (loss)                  25,341   25,341   (114)  25,227 
Foreign currency translation adjustment              12       12   (33)  (21)
Unrealized gain on derivative financial instruments, net of tax of $17              (5)      (5)      (5)
Pension and other postretirement benefits adjustments, net of tax of $161              461       461       461 
Comprehensive (loss) income              468   25,341   25,809   (147)  25,662 
Dividends ($0.07 per share)                  (2,861)  (2,861)      (2,861)
Acquisition of treasury stock  (1,530,478)  (15)          (29,980)  (29,995)      (29,995)
Issuance of common stock under share-based plans, net  17,560       12           12       12 
Share-based compensation expense          3,228           3,228       3,228 

BALANCE AUGUST 3, 2019

  40,720,927  $407  $149,881  $(31,405) $504,546  $623,429  $1,249  $624,678 

 

              

Accumulated

                 
              

Other

      

Total Caleres, Inc.

  

Non-

     

(Unaudited)

 

Common Stock

  

Additional

  

Comprehensive

  

Retained

  

Shareholders’

  

controlling

     

($ thousands, except number of shares and per share amounts)

 

Shares

  

Dollars

  

Paid-In Capital

  

(Loss) Income

  

Earnings

  

Equity

  

Interests

  

Total Equity

 

BALANCE AS OF FEBRUARY 1, 2020

  40,396,757  $404  $153,489  $(31,843) $523,900  $645,950  $3,180  $649,130 

Net loss

                  (376,555)  (376,555)  (286)  (376,841)
Foreign currency translation adjustment              (810)      (810)     (810)

Unrealized gain on derivative financial instruments, net of tax of $31

              92       92       92 

Pension and other postretirement benefits adjustments, net of tax of $380

              1,124       1,124       1,124 
Comprehensive income (loss)              406   (376,555)  (376,149)  (286)  (376,435)

Dividends ($0.14 per share)

                  (5,495)  (5,495)      (5,495)

Acquisition of treasury stock

  (2,902,122)  (29)          (23,319)  (23,348)      (23,348)

Issuance of common stock under share-based plans, net

  417,521   4   (977)          (973)      (973)

Cumulative-effect adjustment from adoption of ASC 326

                  (2,146)  (2,146)      (2,146)

Share-based compensation expense

          4,401           4,401       4,401 

BALANCE AUGUST 1, 2020

  37,912,156  $379  $156,913  $(31,437) $116,385  $242,240  $2,894  $245,134 
                                 

BALANCE FEBRUARY 2, 2019

  41,886,562  $419  $145,889  $(31,601) $519,346  $634,053  $1,382  $635,435 

Net earnings (loss)

                  34,424   34,424   (112)  34,312 

Foreign currency translation adjustment

              (958)      (958)  (21)  (979)

Unrealized loss on derivative financial instruments, net of tax of $79

              298       298       298 

Pension and other postretirement benefits adjustments, net of tax of $299

              856       856       856 
Comprehensive income (loss)              196   34,424   34,620   (133)  34,487 

Dividends ($0.14 per share)

                  (5,808)  (5,808)      (5,808)

Acquisition of treasury stock

  (1,530,478)  (15)          (29,980)  (29,995)      (29,995)

Issuance of common stock under share-based plans, net

  364,843   3   (2,550)          (2,547)      (2,547)

Cumulative-effect adjustment from adoption of ASC 842

                  (13,436)  (13,436)      (13,436)

Share-based compensation expense

          6,542           6,542       6,542 

BALANCE AUGUST 3, 2019

  40,720,927  $407  $149,881  $(31,405) $504,546  $623,429  $1,249  $624,678 

 

7

Table of Contents

 

CALERES, INC. 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

 

Note 1

Basis of Presentation

 

The accompanying condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q of the United States Securities and Exchange Commission (“SEC”) and reflect all adjustments and accruals of a normal recurring nature, which management believes are necessary to present fairly the financial position, results of operations, comprehensive income and cash flows of Caleres, Inc. ("the Company").  These statements, however, do not include all information and footnotes necessary for a complete presentation of the Company's consolidated financial position, results of operations, comprehensive income and cash flows in conformity with accounting principles generally accepted in the United States.  The condensed consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned subsidiaries, after the elimination of intercompany accounts and transactions.

 

The Company’s business is seasonal in nature due to consumer spending patterns, with higher back-to-school and holiday season sales.  Traditionally, the third fiscal quarter accounts for a substantial portion of the Company’s earnings for the year.  Interim results may not necessarily be indicative of results which may be expected for any other interim period or for the year as a whole, particularly given the impact of the coronavirus pandemic on the results of operations for the thirteen and twenty-six weeks ended August 1, 2020, as further discussed below.  In addition, many schools across the United States are beginning the fall semester in a virtual learning environment.  Accordingly, the Company has experienced a slower start to the back-to-school selling season.  The back-to-school demand in 2020 is expected to extend longer than a typical year, where demand is more concentrated over a few weeks.

 

Certain prior period amounts in the condensed consolidated financial statements and footnotes have been reclassified to conform to the current period presentation.  These reclassifications did not affect net (loss) earnings attributable to Caleres, Inc.

 

The accompanying condensed consolidated financial statements and footnotes should be read in conjunction with the consolidated financial statements and footnotes included in the Company's Annual Report on Form 10-K for the year ended February 1, 2020.

 

COVID-19 Pandemic

In March 2020, the World Health Organization declared that the outbreak of the coronavirus ("COVID-19") was a global pandemic.  The Company has experienced a significant loss in sales and earnings as a result of COVID-19.  After the temporary closure of all retail stores in mid- March, the Company has safely resumed in-store operations at substantially all of its retail stores, opening with reduced operating hours, enhanced health and safety procedures and contactless shopping options. 

 

The Company has taken decisive actions to manage its resources conservatively to mitigate the adverse impact of the pandemic.  These actions included reductions in the workforce, associate furloughs for a significant portion of the workforce, and reductions in salary for most remaining associates through the end of the second quarter, as well as a reduction in the cash retainers for the Board of Directors through the end of the fiscal year; reducing inventory purchases; reducing marketing expenses; and minimizing costs associated with the closed retail facilities.  In addition, as a precautionary measure to increase its cash position and preserve financial flexibility given the uncertainty in the United States and global markets resulting from COVID-19, the Company increased the borrowings on its revolving credit facility in March 2020 to $440.0 million.  In April, the Company entered into an amendment to its Fourth Amended and Restated Credit Agreement to increase its borrowing capacity, as further discussed in Note 10 to the condensed consolidated financial statements.  During the second quarter of 2020, the Company continued to repay the incremental borrowings from March, with net repayments of $88.5 million.

 

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security ("CARES") Act was enacted.  The CARES Act includes a provision that allows the Company to defer the employer portion of social security payroll tax payments that would have been paid between the enactment date and December 31, 2020, with 50% payable by December 31, 2021 and 50% payable by December 31, 2022.  As of August 1, 2020, the Company has deferred approximately $2.9 million of employer social security payroll taxes, which are recorded in other liabilities on the condensed consolidated balance sheets.  In addition, the CARES Act permits the carryback of certain current operating losses to prior years.  As discussed in Note 16 to the condensed consolidated financial statements, this carryback provision resulted in approximately $5.2 million of incremental tax benefit, as current year losses are expected to be carried back to years with a higher federal corporate tax rate.      

 

 

Note 2

Impact of New Accounting Pronouncements

 

Impact of Recently Adopted Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments - Credit Losses (Topic 326), which significantly changes how entities measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income.  The ASU replaces the "incurred loss" model with an "expected credit loss" model that requires entities to estimate an expected lifetime credit loss on financial assets, including trade accounts receivable.  The Company adopted the ASU in the first quarter of 2020 on a modified retrospective basis.  Upon adoption, the Company recorded a cumulative-effect adjustment to retained earnings of $2.1 million, net of $0.4 million in deferred taxes.  The Company recorded a provision for expected credit losses of $8.5 million during the twenty-six weeks ended August 1, 2020, primarily as a result of the COVID-19 pandemic and deteriorating financial conditions at several of the Company's wholesale customers.  

 

The following table summarizes the activity in the Company's allowance for expected credit losses during the twenty-six weeks ended August 1, 2020:

 

($ thousands)    

Balance at February 1, 2020

 $1,813 

Adjustment upon adoption of ASU 2016-13

  2,521 

Provision for expected credit losses

  8,525 
Uncollectible accounts written off, net of recoveries  215 
Balance at August 1, 2020 $13,074 

 

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework — Changes to the Disclosure Requirements for Fair Value Measurement.  ASU 2018-13 modifies disclosure requirements on fair value measurements, removing and modifying certain disclosures, while adding other disclosures.  The Company adopted the ASU during the first quarter of 2020, which did not have a material impact on the Company's financial statement disclosures.  Refer to Note 15 to the condensed consolidated financial statements for detail regarding the Company's fair value measurements.

 

 

8

 

In March 2020, the SEC issued SEC Release No. 33-10762 and Release No. 34-88307, Financial Disclosures about Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralize a Registrant's Securities.  The final rule amends the disclosure requirements in SEC Regulation S-X, Rule 3-10, which required entities to separately present financial statements for subsidiary issuers and guarantors of registered debt securities unless certain exceptions are met. The rule permits entities to provide summarized financial information of the parent company and its issuers and guarantors on a combined basis in either a note to the financial statements or in management's discussion and analysis.  The final rule is effective for filings on or after January 4, 2021, with early application permitted.  The Company adopted the rule during the second quarter of 2020 and elected to provide the summarized financial information in Management's Discussion and Analysis of Financial Condition and Results of Operations.

 

In April 2020, the FASB issued interpretive guidance indicating that entities may elect not to evaluate whether a concession provided by lessors is a lease modification.  Under existing lease guidance, an entity would be required to determine if a lease concession was the result of a new arrangement reached with the landlord, which would be accounted for under the lease modification framework, or if the concession was under the enforceable rights and obligations that existed in the original lease, which would be accounted for outside the lease modification framework. The FASB guidance provides entities with the option to elect to account for lease concessions as though the enforceable rights and obligations existed in the original lease.  During the second quarter of 2020, the Company elected to treat lease concessions as variable rent.  Accordingly, $2.0 million in lease concessions were recorded as a reduction of rent expense within selling and administrative expenses in the condensed consolidated statements of earnings (loss).  Refer to Note 9 to the condensed consolidated financial statements for further discussion regarding the Company's leases. 

 

Impact of Prospective Accounting Pronouncements

In August 2018, the FASB issued ASU 2018-14, Compensation — Retirement Benefits — Defined Benefit Plans — General (Subtopic 715-20), Disclosure Framework — Changes to the Disclosure Requirements for Defined Benefit Plans.  The guidance changes the disclosure requirements for employers that sponsor defined benefit pension or other postretirement benefit plans, eliminating the requirements for certain disclosures that are no longer considered cost beneficial and requiring new disclosures that the FASB considers pertinent.  The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted.  The adoption of ASU 2018-14 is not expected to have a material impact on the Company's financial statement disclosures.  

 

In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes. ASU 2019-12 eliminates certain exceptions related to intraperiod tax allocation, simplifies certain elements of accounting for basis differences and deferred tax liabilities during a business combination, and standardizes the classification of franchise taxes. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The adoption of ASU 2019-12 is not expected to have a material impact on the Company's condensed consolidated financial statements.

 

 

Note 3

Revenues

 

Disaggregation of Revenues

The following table disaggregates revenue by segment and major source for the periods ended August 1, 2020 and August 3, 2019:

 

  

Thirteen Weeks Ended August 1, 2020

  

($ thousands)

 

Famous Footwear

  

Brand Portfolio

  

Eliminations and Other

  

Total

  
                  

Retail stores

 $250,143  $7,060  $  $257,203  
Landed wholesale - e-commerce (1)     23,234      23,234  
Landed wholesale - e-commerce - drop ship (1)     20,748      20,748  

Landed wholesale - other

     78,127   (16,109)  62,018  

First-cost wholesale

     11,850      11,850  
First-cost wholesale - e-commerce (1)     256      256  

E-commerce - Company websites (1)

  83,652   40,836      124,488  

Licensing and royalty

     1,469      1,469  

Other (2)

  140   42      182  

Net sales

 $333,935  $183,622  $(16,109) $501,448  

 

  

Thirteen Weeks Ended August 3, 2019

 

($ thousands)

 

Famous Footwear

  

Brand Portfolio

  

Eliminations and Other

  

Total

 
                 
Retail stores $386,014  $38,548  $  $424,562 
Landed wholesale - e-commerce (1)     46,926      46,926 
Landed wholesale - e-commerce - drop ship (1)     16,666      16,666 
Landed wholesale - other     184,962   (26,931)  158,031 
First-cost wholesale