Brown Shoe Company Reports First Quarter 2013 Results

  Brown Shoe Company Reports First Quarter 2013 Results

Consolidated gross margin improves 160 basis points, driven by both wholesale
                                  and retail

        Famous Footwear reports record first quarter operating profit

Business Wire

ST. LOUIS -- May 29, 2013

Brown Shoe Company, Inc. (NYSE: BWS, brownshoe.com) today reported first
quarter 2013 financial results, with net sales of $588.7 million versus first
quarter 2012 net sales of $598.2 million, reflecting an adjustment for
discontinued operations. However, results for the first quarter of 2013 and
2012 also included sales of $0.2 million and $10.2 million, respectively, from
brands and businesses the company has exited. Excluding exited brands,
year-over-year net sales were up slightly in the quarter.

On a GAAP basis, the company reported a net loss of ($10.8) million, or
($0.26) per diluted share, in the first quarter of 2013 versus earnings of
$1.7 million, or $0.04 per diluted share, in the prior year. First quarter
2013 results included $28.8 million of costs associated with our ongoing
portfolio realignment efforts, while earnings for the first quarter of 2012
included $12.8 million of portfolio realignment and ASG integration costs.

On an adjusted^(1) basis, net earnings of $13.8 million, or $0.32 per diluted
share, improved 37.7% compared to $10.0 million, or $0.23 per diluted share,
in the prior year. Gross profit margin for the first quarter of 2013 improved
to 40.8% from 39.2% in 2012.

“In addition to stronger-than-expected adjusted EPS of $0.32, we reported
record first quarter operating profit of $29 million at Famous Footwear, as we
saw improved consumer conversion related to our strategic real estate,
inventory and omni-channel efforts,” said Diane Sullivan, president and chief
executive officer of Brown Shoe Company. “At wholesale, we refined our
portfolio, with the recent sale of Avia and Nevados, and we intend to use the
related proceeds in our 2013 debt reduction efforts. In the first quarter,
prior to the divestiture, we reduced our short-term borrowings by $39
million.”

                                                                
US$M, except per share (unaudited)           13 Weeks             1Q

                                            1Q’13     1Q’12    Change
Consolidated net sales                       $588.7    $598.2   (1.6%)
Famous Footwear                              352.3     347.1    1.5%
Wholesale Operations                         181.6     194.9    (6.8%)
Specialty Retail                             54.8      56.1     (2.5%)
Gross profit                                 240.0     234.3    2.5%
Margin                                       40.8%     39.2%    160 bps
SG&A                                         213.8     211.5    1.1%
% of net sales                               36.3%     35.4%    90 bps
Restructuring and other special charges,     5.2       10.2     (49.2%)
net
Operating earnings                           21.0      12.6     66.5%
% of net sales                               3.6%      2.1%     150 bps
Net interest expense                         5.7       6.0      (5.0%)
Earnings from continuing operations before   15.3      6.6      130.6%
income taxes
Tax rate                                     51.9%     39.4%    1250 bps
Net (loss) from discontinued operations      (18.2)    (2.4)    659.9%
Net (loss) earnings                          ($10.8)   $1.7     (734.9%)
Per diluted share                            ($0.26)   $0.04    (750.0%)
Adjusted net earnings                        $13.8     $10.0    37.7%
Per diluted share                            $0.32     $0.23    39.1%
                                                        

First Quarter Highlights

Famous Footwear first quarter 2013 sales of $352.3 million were up 1.5%
year-over-year, with good growth in athletic and canvas shoe styles as the
quarter progressed. Same-store-sales^(2) were up 1.1% ^  over the prior year,
as strong same-store-sales of 14.2% in April helped offset weather related
weakness in February and March. During the quarter, the company closed or
relocated 13 stores and added 12 new stores, as average revenue per square
foot continued to improve.

Wholesale sales were down 2.9% in the first quarter, excluding discontinued
and exited brands. The company’s Contemporary Fashion wholesale sales were
down 2.5% in the first quarter, while Healthy Living wholesale sales were down
3.1%, both excluding exited brands. Wholesale gross margin of 31.8% expanded
by 310 basis points during the quarter. Both the Contemporary Fashion and
Healthy Living platforms contributed to the improvement, due to a more
profitable brand mix, higher initial margins and lower inventory markdown
requirements.

Consolidated gross profit of $240.0 million was up 2.5% in the first quarter,
while gross margin of 40.8% improved by approximately 160 basis points versus
the prior year. SG&A for the first quarter was $213.8 million, or 36.3% of net
sales, up approximately 90 basis points from 35.4% of net sales in the prior
year. For the quarter, operating margins improved 150 basis points to 3.6%.

Inventory at the end of the first quarter was $485.9 million, up 2.2% compared
to $475.6 million in the prior year. Wholesale inventory was up 2.4%, while
Famous Footwear inventory was up 1.3%.

At quarter-end, Brown Shoe Company had $413.8 million in availability under
its revolving credit facility and $44.7 million in cash and cash equivalents.
The company’s debt-to-capital ratio improved to 39.1% from 43.9% in the first
quarter of 2012.

Financial Review and 2013 Outlook

“Despite uncooperative weather in February and March, we were able to deliver
better than expected results for the quarter,” said Russ Hammer, chief
financial officer of Brown Shoe Company. “To reflect our strong performance in
the first quarter, we are raising our full-year adjusted EPS guidance to $1.22
to $1.29. However, due to the timing of back-to-school, our biggest sales
quarter remains the third quarter.”

                                      
Metric                                 FY’13
Consolidated net sales                 $2.54 to $2.57 billion
Famous Footwear same-store sales       Up low-single digits
Wholesale Operations net sales         Up low-single digits, excluding brand
                                        exits
Gross profit margin                    Up 30 to 50 basis points
SG&A                                   $900 to $910 million
Non-recurring costs                    $32 to $34 million
Net interest expense                   $21 to $22 million
Effective tax rate, on adjusted basis  32% to 33%
Earnings per diluted share             $0.63 to $0.70
Adjusted earnings per diluted share    $1.22 to $1.29
Depreciation and amortization          $54 to $56 million
Capital expenditures                   $50 to $55 million
                                      

Investor Conference Call

Brown Shoe Company will webcast an investor conference call at 9:00 a.m. ET
today, May 29, 2013. The webcast and slides will be available at
investor.brownshoe.com/news/events. A live conference call will be available
at (877) 217-9089 for analysts in North America or (706) 679-1723 for
international analysts by using the conference ID 70291031.

A replay will be available at investor.brownshoe.com/news/events/archive for a
limited period. Investors may also access the replay by dialing (855) 859-2056
in North America or (404) 537-3406 internationally and using the conference ID
70291031 through June 12, 2013.

(1) Non-GAAP Financial Measures

In this press release, the company’s financial results are provided both in
accordance with generally accepted accounting principles (GAAP) and using
certain non-GAAP financial measures. In particular, the company provides
historic and estimated future gross profit, operating earnings, net earnings
and earnings per diluted share adjusted to exclude certain gains, charges and
recoveries, which are non-GAAP financial measures. These results are included
as a complement to results provided in accordance with GAAP because management
believes these non-GAAP financial measures help identify underlying trends in
the company’s business and provide useful information to both management and
investors by excluding certain items that may not be indicative of the
company’s core operating results. These measures should not be considered a
substitute for or superior to GAAP results. Reconciliations to the applicable
GAAP financial measures have been included in the attached schedules.

(2) Same-Stores-Sales

For comparability purposes, same-store-sales for the first quarter of 2013 is
calculated based on retail sales for weeks 1 through 13 in 2013 as compared to
weeks 2 through 14 in 2012. This adjustment is due to the impact of the 53^rd
week of sales in the fourth quarter of fiscal 2012. The calculation for the
first quarter of 2013 appropriately reflects the change in same-store-sales on
a true retail calendar basis.

Definitions

All references in this press release, outside of the condensed consolidated
financial statements that follow, unless otherwise noted, related to net
earnings attributable to Brown Shoe Company, Inc. and diluted earnings per
common share attributable to Brown Shoe Company, Inc. shareholders, are
presented as net earnings and earnings per diluted share, respectively.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of
1995

This press release contains certain forward-looking statements and
expectations regarding the company’s future performance and the performance of
its brands. Such statements are subject to various risks and uncertainties
that could cause actual results to differ materially. These risks include (i)
changing consumer demands, which may be influenced by consumers' disposable
income, which in turn can be influenced by general economic conditions; (ii)
intense competition within the footwear industry; (iii) rapidly changing
fashion trends and purchasing patterns; (iv) customer concentration and
increased consolidation in the retail industry; (v) political and economic
conditions or other threats to the continued and uninterrupted flow of
inventory from China, where Brown Shoe Company relies heavily on manufacturing
facilities for a significant amount of their inventory; (vi) the ability to
recruit and retain senior management and other key associates; (vii) the
ability to attract, retain and maintain good relationships with licensors and
protect intellectual property rights; (viii) the ability to secure/exit leases
on favorable terms; (ix) the ability to maintain relationships with current
suppliers; (x) compliance with applicable laws and standards with respect to
lead content in paint and other product safety issues; (xi) the ability to
source product at a pace consistent with increased demand for footwear; and
(xii) the impact of rising prices in a potentially inflationary global
environment. The company's reports to the Securities and Exchange Commission
contain detailed information relating to such factors, including, without
limitation, the information under the caption Risk Factors in Item 1A of the
company’s Annual Report on Form 10-K for the year ended Feb. 2, 2013, which
information is incorporated by reference herein and updated by the company’s
Quarterly Reports on Form 10-Q. The company does not undertake any obligation
or plan to update these forward-looking statements, even though its situation
may change.

About Brown Shoe Company

Brown Shoe Company is a $2.6 billion, global footwear company whose shoes are
worn by people of all ages, from all walks of life. Our products are available
virtually everywhere — in the nearly 1,300 Famous Footwear and Naturalizer
retail stores we operate, in hundreds of major department and specialty
stores, on 14 branded ecommerce sites, and on many additional third-party
retail websites. Through our broad range of products, we serve three key
market segments. Our Family brands — Famous Footwear, Famous.com, and
shoes.com — are one-stop-shopping destinations for high quality, affordable
styles for a family’s every occasion. Active people who want comfort, style
and performance can look to our Healthy Living brands — Naturalizer, Dr.
Scholl's Shoes, LifeStride and Ryka. Our Contemporary Fashion brands — Via
Spiga, Vince, Sam Edelman, Franco Sarto, Carlos Santana and Fergie Footwear —
keep fashionistas in step with the latest trends. At Brown Shoe Company, we
inspire people to feel good and live better... feet first!

SCHEDULE 1                                                   
                                                                
BROWN SHOE COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                                                                
                                                  (Unaudited)
                                                  13 Weeks Ended
(Thousands, except per share data)                May 4, 2013   April 28, 2012
                                                                
Net sales                                         $ 588,656     $  598,179
Cost of goods sold                                 348,640      363,925  
                                                                
Gross profit                                       240,016      234,254  
                                                                
Selling and administrative expenses                 213,879        211,475
Restructuring and other special charges, net       5,179        10,188   
                                                                
Operating earnings                                 20,958       12,591   
                                                                
Interest expense                                    (5,721  )      (6,036   )
Interest income                                    68           83       
                                                                
Earnings before income taxes from continuing       15,305       6,638    
operations
                                                                
Income tax provision                               (7,946  )     (2,616   )
                                                                
Net earnings from continuing operations            7,359        4,022    
                                                                
Discontinued operations:
Loss from discontinued operations, net of tax       (5,637  )      (2,394   )
of $3,583 in 2013 and $1,623 in 2012
Impairment charge on net assets of discontinued    (12,554 )     -        
operations, net of tax of $0
                                                                
Net loss from discontinued operations              (18,191 )     (2,394   )
                                                                
Net (loss) earnings                                (10,832 )     1,628    
                                                                
Net loss attributable to noncontrolling            (70     )     (67      )
interests
                                                                
Net (loss) earnings attributable to Brown Shoe    $ (10,762 )   $  1,695    
Company, Inc.
                                                                
Basic earnings (loss) per common share:
From continuing operations                        $ 0.18        $  0.10
From discontinued operations                       (0.44   )     (0.06    )
Basic (loss) earnings per common share
attributable to
Brown Shoe Company, Inc. shareholders             $ (0.26   )   $  0.04     
                                                                
Diluted earnings (loss) per common share:
From continuing operations                        $ 0.18        $  0.10
From discontinued operations                       (0.44   )     (0.06    )
Diluted (loss) earnings per common share
attributable to
Brown Shoe Company, Inc. shareholders             $ (0.26   )   $  0.04     
                                                                
Basic number of shares                              41,070         40,422
Diluted number of shares                           41,268       40,744   
                                                                

SCHEDULE 2                                                
                                                              
BROWN SHOE COMPANY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
                                                              
                               (Unaudited)                    
(Thousands)                    May 4, 2013   April 28, 2012   February 2, 2013
ASSETS
                                                              
Cash and cash equivalents      $ 44,669      $   39,792       $    68,223
Receivables, net                 96,734          115,911           111,392
Inventories, net                 485,923         475,557           503,688
Prepaid expenses and other       43,167          41,375            42,016
current assets
Current assets - held for        12,496          -                 -
sale
Current assets -                39,159         65,515           47,109
discontinued operations
Total current assets            722,148        738,150          772,428
                                                              
Property and equipment, net      137,299         124,551           144,856
Goodwill and intangible          68,442          81,975            82,504
assets, net
Other assets                     115,591         137,479           119,695
Non current assets -            51,227         58,667           51,776
discontinued operations
Total assets                   $ 1,094,707   $   1,140,822    $    1,171,259
                                                              
LIABILITIES AND EQUITY
                                                              
Borrowings under revolving     $ 66,000      $   124,000      $    105,000
credit agreement
Trade accounts payable           188,948         172,894           213,660
Other accrued expenses           118,632         129,852           137,190
Current liabilities - held       5,306           -                 -
for sale
Current liabilities -           16,183         15,118           13,259
discontinued operations
Total current liabilities       395,069        441,864          469,109
                                                              
Long-term debt                   198,870         198,680           198,823
Deferred rent                    35,631          29,746            33,711
Other liabilities                45,435          47,569            36,719
Non current liabilities -       6,768          9,969            6,996
discontinued operations
Total other liabilities         286,704        285,964          276,249
                                                              
Total Brown Shoe Company,        412,190         412,012           425,129
Inc. shareholders’ equity
Noncontrolling interests        744            982              772
Total equity                    412,934        412,994          425,901
Total liabilities and equity   $ 1,094,707   $   1,140,822    $    1,171,259
                                                              

SCHEDULE 3                                                   
                                                                
BROWN SHOE COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                                
                                                 13 Weeks Ended
(Thousands)                                      May 4, 2013    April 28, 2012
OPERATING ACTIVITIES:
Net (loss) earnings                              $ (10,832  )   $  1,628
Adjustments to reconcile net (loss) earnings
to net cash provided by operating activities:
Depreciation and amortization                      13,805          13,280
Amortization of debt issuance costs                629             629
Share-based compensation expense                   1,617           1,444
Tax benefit related to share-based plans           (1,962   )      (753      )
Loss on disposal of facilities and equipment       68              456
Impairment charges for facilities and              5,026           2,756
equipment
Impairment of net assets of discontinued           12,554          -
operations
Deferred rent                                      1,920           (2,615    )
Provision for doubtful accounts                    307             950
Changes in operating assets and liabilities:
Receivables                                        16,363          13,587
Inventories                                        17,223          49,251
Prepaid expenses and other current and             653             6,377
noncurrent assets
Trade accounts payable                             (26,561  )      (8,268    )
Accrued expenses and other liabilities             (1,565   )      1,900
Other, net                                        (3,284   )     (724      )
Net cash provided by operating activities         25,961        79,898    
                                                                
INVESTING ACTIVITIES:
Capital expenditures                               (8,407   )      (7,008    )
Proceeds from sale of assets                      1,500         -         
Net cash used for investing activities            (6,907   )     (7,008    )
                                                                
FINANCING ACTIVITIES:
Borrowings under revolving credit agreement        383,000         165,000
Repayments under revolving credit agreement        (422,000 )      (242,000  )
Dividends paid                                     (3,027   )      (2,999    )
Issuance of common stock under share-based         (2,070   )      (2,148    )
plans, net
Tax benefit related to share-based plans          1,962         753       
Net cash used for financing activities            (42,135  )     (81,394   )
Effect of exchange rate changes on cash and       (473     )     614       
cash equivalents
Decrease in cash and cash equivalents              (23,554  )      (7,890    )
Cash and cash equivalents at beginning of         68,223        47,682    
period
                                                                
Cash and cash equivalents at end of period       $ 44,669      $  39,792    
                                                                

SCHEDULE 4                                                                     
                                                                                      
BROWN SHOE COMPANY,
INC.
RECONCILIATION OF NET (LOSS) EARNINGS AND DILUTED (LOSS) EARNINGS PER SHARE (GAAP BASIS) TO
ADJUSTED NET EARNINGS AND ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP BASIS)
                                                                                      
                      (Unaudited)                           (Unaudited)
                      13 Weeks Ended May 4, 2013            13 Weeks Ended April 28, 2012
                      Pre-Tax    Net (Loss)                 Pre-Tax    Net Earnings
                      Impact     Earnings       Diluted     Impact     Attributable   Diluted
(Thousands, except    of         Attributable   (Loss)      of         to             Earnings
per share data)       Charges/   to             Earnings    Charges/   Brown Shoe     Per
                      Other      Brown Shoe     Per         Other      Company,       Share
                      Items      Company,       Share       Items      Inc.
                                 Inc.
                                                                                      
GAAP (loss)                      $  (10,762 )   $ (0.26 )              $   1,695      $  0.04
earnings
                                                                                      
Charges/Other
Items:
Portfolio
realignment
Non-cash impairment   $ 17,214      17,214        0.41      $ -            -             -
charges
Business exits and      11,627      7,347         0.17        12,091       7,883         0.18
cost reductions
ASG
integration-related     -           -             -           675          441           0.01
costs
                                                                                 
Total charges/other   $ 28,841     24,561      0.58     $ 12,766      8,324        0.19
items
                                                                                      
Adjusted earnings                $  13,799     $ 0.32                $   10,019     $  0.23
                                                                                      

SCHEDULE 5                                                                                                                       
                                                                                                                                            
BROWN SHOE COMPANY, INC.
SUMMARY FINANCIAL RESULTS BY SEGMENT
(Unaudited)                                                                                                              
                                                                                                                                            

SUMMARY FINANCIAL RESULTS
                                                                                                                                            
                Famous Footwear             Wholesale Operations        Specialty Retail            Other                     Consolidated
                13 Weeks Ended              13 Weeks Ended              13 Weeks Ended              13 Weeks Ended            13 Weeks Ended
                May 4,        April 28,     May 4,        April 28,     May 4,        April 28,     May 4,       April 28,    May 4,        April 28,
(Thousands)     2013          2012          2013          2012          2013          2012          2013         2012         2013          2012
                                                                                                                                            
Net Sales       $ 352,279     $ 347,107     $ 181,625     $ 194,941     $ 54,752      $ 56,131      $ -          $ -          $ 588,656     $ 598,179
                                                                                                                                            
Gross Profit    $ 158,661     $ 155,140     $ 57,819      $ 55,945      $ 23,536      $ 23,169      $ -          $ -          $ 240,016     $ 234,254
Adjusted        $ 158,661     $ 155,140     $ 57,819      $ 57,035      $ 23,536      $ 23,390      $ -          $ -          $ 240,016     $ 235,565
Gross Profit
                                                                                                                                            
Gross Profit      45.0    %     44.7    %     31.8    %     28.7    %     43.0   %      41.3   %      -            -            40.8    %     39.2    %
Rate
Adjusted
Gross Profit      45.0    %     44.7    %     31.8    %     29.3    %     43.0   %      41.7   %      -            -            40.8    %     39.4    %
Rate
                                                                                                                                            
Operating
Earnings        $ 29,042      $ 18,301      $ 3,107       $ 5,875       $ (1,329 )    $ (3,527 )    $ (9,862 )   $ (8,058 )   $ 20,958      $ 12,591
(Loss)
Adjusted
Operating       $ 29,042      $ 25,326      $ 8,270       $ 8,904       $ (1,329 )    $ (2,538 )    $ (9,846 )   $ (7,602 )   $ 26,137      $ 24,090
Earnings
(Loss)
                                                                                                                                            
Operating
Earnings          8.2     %     5.3     %     1.7     %     3.0     %     (2.4   %)     (6.3   %)     -            -            3.6     %     2.1     %
(Loss) %
Adjusted
Operating         8.2     %     7.3     %     4.6     %     4.6     %     (2.4   %)     (4.5   %)     -            -            4.4     %     4.0     %
Earnings
(Loss) %
                                                                                                                                            
Same-store
Sales % (on a     1.1     %     2.5     %     -             -             (0.3   %)     2.6    %      -            -            -             -
13-week
basis)
                                                                                                                                            
Number of         1,054         1,066         -             -             215           227           -            -            1,269         1,293
Stores
                                                                                                                         
                                                                                                                                            

RECONCILIATION OF ADJUSTED RESULTS (NON-GAAP)
                                                                                                                                            
                Famous Footwear             Wholesale Operations        Specialty Retail            Other                     Consolidated
                13 Weeks Ended              13 Weeks Ended              13 Weeks Ended              13 Weeks Ended            13 Weeks Ended
                May 4,        April 28,     May 4,        April 28,     May 4,        April 28,     May 4,       April 28,    May 4,        April 28,
(Thousands)     2013          2012          2013          2012          2013          2012          2013         2012         2013          2012
                                                                                                                                            
Gross Profit    $ 158,661     $ 155,140     $ 57,819      $ 55,945      $ 23,536      $ 23,169      $ -          $ -          $ 240,016     $ 234,254
                                                                                                                                            
Charges/Other
Items:
Portfolio
realignment
Business
exits and         -             -             -             1,090         -             221           -            -            -             1,311
cost
reductions
                                                                                                                                   
Total
charges/other    -           -           -           1,090       -           221         -          -          -           1,311   
items
                                                                                                                                            
Adjusted        $ 158,661    $ 155,140    $ 57,819     $ 57,035     $ 23,536     $ 23,390     $ -         $ -         $ 240,016    $ 235,565 
Gross Profit
                                                                                                                                            
                                                                                                                                            
Operating
Earnings        $ 29,042      $ 18,301      $ 3,107       $ 5,875       $ (1,329 )    $ (3,527 )    $ (9,862 )   $ (8,058 )   $ 20,958      $ 12,591
(Loss)
                                                                                                                                            
Charges/Other
Items:
Portfolio
realignment
Non-cash
impairment        -             -             4,660         -             -             -             -            -            4,660         -
charges
Business
exits and         -             7,025         503           3,029         -             989           16           456          519           11,499
cost
reductions
                                                                                                                                   
Total
charges/other    -           7,025       5,163       3,029       -           989         16         456        5,179       11,499  
items
                                                                                                                                            
Adjusted
Operating       $ 29,042     $ 25,326     $ 8,270      $ 8,904      $ (1,329 )    $ (2,538 )    $ (9,846 )   $ (7,602 )   $ 26,137     $ 24,090  
Earnings
(Loss)
                                                                                                                                            
                                                                                                                                            
                                                                                                                                            
Note: April 28, 2012 information has been updated for the impact of discontinued operations.


SCHEDULE 6                                                       
                                                                    
BROWN SHOE COMPANY, INC.
BASIC AND DILUTED EARNINGS PER SHARE RECONCILIATION
                                                                    
                                                      (Unaudited)
                                                      13 Weeks Ended
                                                      May 4,        April 28,
(Thousands, except per share data)                    2013          2012
                                                                    
Net earnings attributable to Brown Shoe Company,
Inc.:
Net earnings from continuing operations               $ 7,359       $ 4,022
Net loss attributable to noncontrolling interests       70            67
Net earnings allocated to participating securities     -           (155   )
Net earnings from continuing operations                7,429       3,934  
                                                                    
Net loss from discontinued operations                   (18,191 )     (2,394 )
Net earnings allocated to participating securities     -           -      
Net loss from discontinued operations                  (18,191 )    (2,394 )
                                                                    
Net (loss) earnings attributable to Brown Shoe
Company, Inc. after allocation of earnings to         $ (10,762 )   $ 1,540  
participating securities
                                                                    
                                                                    
Basic and diluted common shares attributable to
Brown Shoe Company, Inc.:
Basic common shares for continuing operations and       41,070        40,422
discontinued operations
Dilutive effect of share-based awards for              198         322    
continuing operations and discontinued operations
Diluted common shares for continuing operations and
discontinued operations attributable to Brown Shoe     41,268      40,744 
Company, Inc.
                                                                    
Basic earnings (loss) per share:
From continuing operations                            $ 0.18        $ 0.10
From discontinued operations                           (0.44   )    (0.06  )
Basic (loss) earnings per common share attributable   $ (0.26   )   $ 0.04   
to Brown Shoe Company, Inc. shareholders
                                                                    
Diluted earnings (loss) per share:
From continuing operations                            $ 0.18        $ 0.10
From discontinued operations                           (0.44   )    (0.06  )
Diluted (loss) earnings per common share
attributable to Brown Shoe Company, Inc.              $ (0.26   )   $ 0.04   
shareholders
                                                                             

                                                                 
SCHEDULE 7
                                                                    
BROWN SHOE COMPANY, INC.
BASIC AND DILUTED ADJUSTED EARNINGS PER SHARE RECONCILIATION
                                                                    
                                                       (Unaudited)
                                                       13 Weeks Ended
                                                       May 4,       April 28,
(Thousands, except per share data)                     2013         2012
                                                                    
Adjusted net earnings attributable to Brown Shoe
Company, Inc.:
Adjusted net earnings from continuing operations       $ 12,336     $ 11,520
Net loss attributable to noncontrolling interests        70           67
Net earnings allocated to participating securities      (591   )    (489   )
Adjusted net earnings from continuing operations        11,815     11,098 
                                                                    
Adjusted net earnings (loss) from discontinued           1,393        (1,568 )
operations
Net earnings allocated to participating securities      (67    )    -      
Net earnings (loss) from discontinued operations        1,326      (1,568 )
                                                                    
Adjusted net earnings attributable to Brown Shoe
Company, Inc. after allocation of earnings to          $ 13,141    $ 9,530  
participating securities
                                                                    
                                                                    
Basic and diluted common shares attributable to
Brown Shoe Company, Inc.:
Basic common shares for continuing operations and        41,070       40,422
discontinued operations
Dilutive effect of share-based awards for continuing    198        322    
operations and discontinued operations
Diluted common shares for continuing operations and
discontinued operations attributable to Brown Shoe      41,268     40,744 
Company, Inc.
                                                                    
Basic adjusted earnings (loss) per share:
From continuing operations                             $ 0.29       $ 0.28
From discontinued operations                            0.03       (0.04  )
Basic adjusted earnings per common share
attributable to Brown Shoe Company, Inc.               $ 0.32      $ 0.24   
shareholders
                                                                    
Diluted adjusted earnings (loss) per share:
From continuing operations                             $ 0.29       $ 0.27
From discontinued operations                            0.03       (0.04  )
Diluted adjusted earnings per common share
attributable to Brown Shoe Company, Inc.               $ 0.32      $ 0.23   
shareholders
                                                                    

                                                           
SCHEDULE 8
                                                                
BROWN SHOE COMPANY,
INC.
ADJUSTMENTS TO FIRST QUARTER 2012 RESULTS FOR DISCONTINUED OPERATIONS
                                                                
                                                                
                          13 Weeks Ended
                          Previously         Adjustments for
(Thousands)               Reported April    Discontinued      April 28, 2012
                          28, 2012           Operations
                                                                
Net sales                 $   626,441        $   (28,262  )     $  598,179
Cost of goods sold           387,377          (23,452  )       363,925  
                                                                
Gross profit                 239,064          (4,810   )       234,254  
                                                                
Selling and
administrative                218,914            (7,439   )        211,475
expenses
Restructuring and
other special                11,455           (1,267   )       10,188   
charges, net
                                                                
Operating earnings           8,695            3,896           12,591   
                                                                
Interest expense              (6,157   )         121               (6,036   )
Interest income              83               -               83       
                                                                
Earnings before
income taxes from            2,621            4,017           6,638    
continuing operations
                                                                
Income tax provision         (993     )        (1,623   )       (2,616   )
                                                                
Net earnings from            1,628            2,394           4,022    
continuing operations
                                                                
Net loss from
discontinued                 -                (2,394   )       (2,394   )
operations
                                                                
Net earnings                 1,628            -               1,628    
                                                                
Net loss attributable
to noncontrolling            (67      )        -               (67      )
interests
                                                                
Net earnings
attributable to Brown     $   1,695         $   -             $  1,695    
Shoe Company, Inc.
                                                                
                                                                
Note: Beginning with the first quarter of 2013, the operations of our Avia,
Nevados, Vera Wang and Etienne Aigner brands qualify as discontinued
operations. We have provided this reconciliation to illustrate the impact of
the reclassifications for discontinued operations.
                                                             

                                                           
SCHEDULE 8 -
CONTINUED
                                                                
BROWN SHOE COMPANY,
INC.
ADJUSTMENTS TO SECOND QUARTER 2012 RESULTS FOR DISCONTINUED OPERATIONS
                                                                
                                                                
                          13 Weeks Ended
                          Previously         Adjustments for
(Thousands)               Reported          Discontinued      July 28, 2012
                          July 28, 2012      Operations
                                                                
Net sales                 $   599,279        $   (34,382  )     $  564,897
Cost of goods sold           365,465          (28,222  )       337,243  
                                                                
Gross profit                 233,814          (6,160   )       227,654  
                                                                
Selling and
administrative                219,261            (7,555   )        211,706
expenses
Restructuring and
other special                 7,491              (165     )        7,326
charges, net
Impairment of                5,777            (5,777   )       -        
intangible assets
                                                                
Operating earnings           1,285            7,337           8,622    
                                                                   -
Interest expense              (5,758   )         113               (5,645   )
Interest income              77               -               77       
                                                                
(Loss) earnings
before income taxes          (4,396   )        7,450           3,054    
from continuing
operations
                                                                
Income tax benefit           1,682            (2,923   )       (1,241   )
(provision)
                                                                
Net (loss) earnings
from continuing              (2,714   )        4,527           1,813    
operations
                                                                
Net loss from
discontinued                 -                (4,527   )       (4,527   )
operations
                                                                
Net loss                     (2,714   )        -               (2,714   )
                                                                
Net loss attributable
to noncontrolling            (179     )        -               (179     )
interests
                                                                
Net loss attributable
to Brown Shoe             $   (2,535   )     $   -             $  (2,535   )
Company, Inc.
                                                                
                                                                
Note: Beginning with the first quarter of 2013, the operations of our Avia,
Nevados, Vera Wang and Etienne Aigner brands qualify as discontinued
operations. We have provided this reconciliation to illustrate the impact of
the reclassifications for discontinued operations.
                                                             

                                                           
SCHEDULE 8 -
CONTINUED
                                                                
BROWN SHOE COMPANY,
INC.
ADJUSTMENTS TO THIRD QUARTER 2012 RESULTS FOR DISCONTINUED OPERATIONS
                                                                
                                                                
                         13 Weeks Ended
                         Previously          Adjustments for    October 27,
(Thousands)              Reported           Discontinued      2012
                         October 27, 2012    Operations
                                                                
Net sales                $   732,169         $   (36,184  )     $  695,985
Cost of goods sold          446,387           (29,737  )       416,650  
                                                                
Gross profit                285,782           (6,447   )       279,335  
                                                                
Selling and
administrative               242,317             (6,121   )        236,196
expenses
Restructuring and
other special               2,342             (196     )       2,146    
charges, net
                                                                
Operating earnings          41,123            (130     )       40,993   
                                                                
Interest expense             (5,513    )         115               (5,398   )
Interest income             76                -               76       
                                                                
Earnings before
income taxes from           35,686            (15      )       35,671   
continuing operations
                                                                
Income tax provision        (11,399   )        (19      )       (11,418  )
                                                                
Net earnings from           24,287            (34      )       24,253   
continuing operations
                                                                
Net earnings from
discontinued                -                 34              34       
operations
                                                                
Net earnings                24,287            -               24,287   
                                                                
Net loss attributable
to noncontrolling           (5        )        -               (5       )
interests
                                                                
Net earnings
attributable to Brown    $   24,292         $   -             $  24,292   
Shoe Company, Inc.
                                                                
                                                                
Note: Beginning with the first quarter of 2013, the operations of our Avia,
Nevados, Vera Wang and Etienne Aigner brands qualify as discontinued
operations. We have provided this reconciliation to illustrate the impact of
the reclassifications for discontinued operations.
                                                             

                                                           
SCHEDULE 8 -
CONTINUED
                                                                
BROWN SHOE COMPANY,
INC.
ADJUSTMENTS TO FOURTH QUARTER 2012 RESULTS FOR DISCONTINUED OPERATIONS
                                                                
                                                                
                         14 Weeks Ended
                         Previously          Adjustments for    February 2,
(Thousands)              Reported           Discontinued      2013
                         February 2, 2013    Operations
                                                                
Net sales                $   640,176         $   (21,441  )     $  618,735
Cost of goods sold          388,477           (17,074  )       371,403  
                                                                
Gross profit                251,699           (4,367   )       247,332  
                                                                
Selling and
administrative               238,465             (6,176   )        232,289
expenses
Restructuring and
other special               2,730             41              2,771    
charges, net
                                                                
Operating earnings          10,504            1,768           12,272   
                                                                
Interest expense             (5,954    )         60                (5,894   )
Interest income             86                -               86       
                                                                
Earnings before
income taxes from           4,636             1,828           6,464    
continuing operations
                                                                
Income tax provision        (633      )        (748     )       (1,381   )
                             -
Net earnings from           4,003             1,080           5,083    
continuing operations
                                                                
Net loss from
discontinued                -                 (1,080   )       (1,080   )
operations
                                                                
Net earnings                4,003             -               4,003    
                                                                
Net loss attributable
to noncontrolling           (36       )        -               (36      )
interests
                                                                
Net earnings
attributable to Brown    $   4,039          $   -             $  4,039    
Shoe Company, Inc.
                                                                
                                                                
Note: Beginning with the first quarter of 2013, the operations of our Avia,
Nevados, Vera Wang and Etienne Aigner brands qualify as discontinued
operations. We have provided this reconciliation to illustrate the impact of
the reclassifications for discontinued operations.


Contact:

Brown Shoe Company
Investors
Peggy Reilly Tharp, 314-854-4134
ptharp@brownshoe.com
or
Media
Kelly Malone, 314-854-4093
kmalone@brownshoe.com