Shoe Carnival Declares Increased Quarterly Cash Dividend

Rhea-AI Summary

Shoe Carnival, Inc. (SCVL) increases its quarterly cash dividend by 12.5% to $0.135 per share, totaling an annualized rate of $0.54 per share. This marks the 48th consecutive quarterly dividend and the 10th consecutive year of dividend increases. The company has raised the quarterly dividend by 35% in the last twelve months, showcasing confidence in growth and shareholder returns.

Insights

Financial Analyst

The announcement of a 12.5% increase in Shoe Carnival's quarterly cash dividend is a signal of the company's financial health and management's confidence in its ability to sustain and potentially grow future earnings. The dividend increase, from an annualized perspective, enhances the yield of the stock, which could make it more attractive to income-focused investors. Furthermore, the company's ability to fund operations without long-term debt is indicative of strong cash flow management, a critical aspect in retail which operates on thin margins and often faces significant inventory risks.

It is essential to consider the payout ratio, which is the proportion of earnings paid out as dividends to shareholders. A sustainable payout ratio typically suggests that the company can maintain or grow its dividend without compromising its financial stability. An increase of this magnitude could imply that management foresees continued profitability and possibly a conservative payout ratio. Investors might view this as a positive sign, but they should also evaluate the company's earnings reports and cash flow statements to ensure that the increased dividend is well-covered by earnings and free cash flow.

Market Research Analyst

Shoe Carnival's consistent history of dividend payments, marked by the 48th consecutive quarterly dividend and a decade of annual increases, positions the company as potentially reliable for dividend investors seeking steady income streams. This track record may also reflect the company's competitive positioning within the family footwear and accessories retail sector. By analyzing market trends and consumer spending patterns, one can infer that Shoe Carnival's strategy is resonating with its target demographic, contributing to the financial stability required to support a growing dividend.

The retail industry is highly competitive and Shoe Carnival's ability to increase dividends could be a result of effective inventory management, adoption of e-commerce and customer loyalty programs. These factors can contribute to a robust growth strategy, which is essential in an industry where consumer preferences are rapidly evolving. The announcement may also be timed to align with broader economic indicators, such as consumer confidence and disposable income levels, which are critical for retail spending.

Economist

From an economic standpoint, the decision to increase dividends may reflect broader economic conditions such as low interest rates, which make dividend-paying stocks more appealing compared to fixed-income securities. Additionally, in a low inflationary environment, a dividend increase can offer investors a real return on their investment. However, if inflation rates are high, investors must consider whether the increased dividend will compensate for the eroded purchasing power.

Moreover, the company's lack of long-term debt is a prudent financial strategy, especially in a potentially rising interest rate environment where servicing debt can become more expensive. The absence of significant debt on the balance sheet allows for more flexibility in capital allocation decisions, such as increasing shareholder returns through dividends. It also suggests that the company is less vulnerable to economic downturns, which can be reassuring for investors who are risk-averse.

Board of Directors Increases Quarterly Cash Dividend by 12.5 percent

EVANSVILLE, Ind.--(BUSINESS WIRE)-- Shoe Carnival, Inc. (Nasdaq: SCVL) (the “Company”), a leading retailer of footwear and accessories for the family, announced today that its Board of Directors has approved the payment of a quarterly cash dividend of $0.135 per share, representing a quarterly increase of 12.5 percent and an increased annualized dividend rate to $0.54 per share.

The quarterly cash dividend will be paid on April 22, 2024, to shareholders of record as of the close of business on April 8, 2024.

“This marks our 48th consecutive quarterly dividend and the 10th consecutive year we have increased the dividend. In the last twelve months, we have increased the quarterly dividend by 35 percent. Our growth strategy and profit transformation position us to continue generating strong cash flows and fund our operations without long-term debt. The Board’s decision to increase the quarterly dividend demonstrates our confidence in delivering growth and further enhancing shareholder returns,” commented Mark Worden, Shoe Carnival’s President and Chief Executive Officer.

Future declarations of dividends are subject to approval of the Board of Directors and will depend on the Company’s results of operations, financial condition, business conditions and other factors deemed relevant by the Board of Directors.

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 14, 2024, the Company operates 429 stores in 36 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 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, as well as our growth strategy and profit transformation.

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 control costs and meet our labor needs in a rising wage, inflationary, and/or supply chain constrained environment; the impact of competition and pricing, including our ability to maintain current promotional intensity levels; the effects and duration of economic downturns and unemployment rates; our ability to achieve expected operating results from, and planned growth of, our Shoe Station banner, which includes the recently acquired stores and operations of Rogan Shoes, Incorporated (“Rogan’s”), within expected time frames, or at all; 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; 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 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 integrate Rogan’s, retain Rogan’s employees, and achieve the expected operating results, synergies, efficiencies and other benefits from the Rogan’s acquisition within the expected time frames, or at all; risks that the Rogan’s acquisition may disrupt our current plans and operations or negatively impact our relationship with our vendors and other suppliers; 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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240314663804/en/

Steve R. Alexander

Shoe Carnival – Vice President Investor Relations

(812) 306-6176

Source: Shoe Carnival, Inc.

FAQ

What is the new quarterly cash dividend per share for Shoe Carnival, Inc. (SCVL)?

The new quarterly cash dividend per share for Shoe Carnival, Inc. (SCVL) is $0.135.

How much is the annualized dividend rate for Shoe Carnival, Inc. (SCVL) after the increase?

After the increase, the annualized dividend rate for Shoe Carnival, Inc. (SCVL) is $0.54 per share.

How many consecutive quarterly dividends has Shoe Carnival, Inc. (SCVL) paid?

Shoe Carnival, Inc. (SCVL) has paid 48 consecutive quarterly dividends.

How many years has Shoe Carnival, Inc. (SCVL) consecutively increased its dividend?

Shoe Carnival, Inc. (SCVL) has consecutively increased its dividend for 10 years.

By what percentage has Shoe Carnival, Inc. (SCVL) increased its quarterly dividend in the last twelve months?

Shoe Carnival, Inc. (SCVL) has increased its quarterly dividend by 35% in the last twelve months.