Brown Shoe Company Reports Fourth Quarter and Full Year 2013 Results

  Brown Shoe Company Reports Fourth Quarter and Full Year 2013 Results

          Wholesale Operations sales up 13.5% and 5.3%, respectively

Famous Footwear delivers record 2013 operating earnings of $107.1 million, up
                                    13.8%

Business Wire

ST. LOUIS -- March 14, 2014

Brown Shoe Company (NYSE: BWS) (brownshoe.com) today reported fourth quarter
2013 financial results, with net sales of $600.0 million down 3.0% versus
fourth quarter 2012 net sales of $618.7 million. Fourth quarter 2013 net
earnings of $6.2 million, or $0.14 per diluted share, were slightly ahead of
company expectations. In the fourth quarter of the prior year, net earnings
were $4.0 million, or $0.09 per diluted share. Fourth quarter 2012 results
included $2.9 million of costs related to the company’s portfolio realignment
efforts ($1.8 million on an after-tax basis, or $0.05 per diluted share).

For full year 2013, net sales of $2,513.1 million were up 1.4% compared to
$2,477.8 million in 2012. Net earnings for 2013 were $38.1 million, or $0.88
per diluted share, versus $27.5 million, or $0.64 per diluted share, in 2012.
Earnings for 2013 included portfolio realignment costs of $30.7 million, while
earnings for 2012 included portfolio realignment, organization change and
integration related costs of $32.9 million. On an adjusted basis, 2013 net
earnings of $61.5 million, or $1.41 per diluted share, were up 26.5% compared
to $48.6 million, or $1.13 per diluted share, in 2012.

Gross profit margin for the fourth quarter of 2013 improved to 40.2% from
40.0% in the fourth quarter of 2012. For the full year, it improved to 40.4%
from 39.9% in 2012.

“Brown Shoe Company delivered a successful fourth quarter and 2013. We
reported year-over-year operating earnings growth of 32.4%, while delivering a
2.9% increase in 2013 Famous Footwear same-store-sales. Our wholesale brands
continued to make progress, growing sales 13.5% in the fourth quarter and 5.3%
in 2013,” said Diane Sullivan, CEO, president and chairman of Brown Shoe
Company. “We are looking forward to continuing to execute against our
strategies to deliver increasing shareholder value, as we grow our retail and
wholesale businesses in 2014.”

US$M, except    13 Weeks  14      4Q        52 Weeks  53 Weeks  FY
per share                   Weeks
(unaudited)      4Q’13      4Q’12    Change     FY’13      FY’12      Change
Consolidated    $600.0    $618.7  (3.0%)    $2,513.1  $2,477.8  1.4%
net sales
Famous          347.4     380.1   (8.6%)    1,527.5   1,514.3   0.9%
Footwear
Wholesale       196.3     173.0   13.5%     763.7     724.9     5.3%
Operations
Specialty       56.2      65.6    (14.3%)   221.9     238.5     (7.0%)
Retail
Gross profit    241.4     247.3   (2.4%)    1,014.3   988.6     2.6%
Margin          40.2%     40.0%   20 bps    40.4%     39.9%     50 bps
SG&A            231.2     232.2   (0.5%)    909.7     891.7     2.0%
% of net sales  38.5%     37.6%   90 bps    36.2%     36.0%     20 bps
Restructuring
and other       -         2.8     (100.0%)  1.3       22.4      (94.4%)
special
charges, net
Operating       10.2      12.3    (17.1%)   98.6      74.5      32.4%
earnings
% of net sales  1.7%      2.0%    (30 bps)  3.9%      3.0%      90 bps
Net interest    (5.0)     (5.8)   (14.0%)   (20.9)    (22.7)    (7.8%)
expense
Earnings from
continuing
operations,     5.2       6.5     (19.8%)   77.7      51.8      50.0%
before income
taxes
Tax rate        (14.8%)   21.4%   n/m       30.6%     32.1%     (150
                                                                      bps)
Net earnings
(loss) from     0.2       (1.1)   119.4%    (16.1)    (8.0)     (101.9%)
discontinued
operations
Net earnings    $6.2      $4.0    52.6%     $38.1     $27.5     38.5%
Per diluted     $0.14     $0.09   55.6%     $0.88     $0.64     37.5%
share
Adjusted net    $6.2      $5.9    5.1%      $61.5     $48.6     26.5%
earnings
Per diluted     $0.14     $0.14   --        $1.41     $1.13     24.8%
share

Fourth Quarter Highlights

Famous Footwear fourth quarter 2013 sales of $347.4 million were down 8.6%
year-over-year, with same-store-sales^(1) down 1.8%. Performance in the
quarter was impacted by severe winter weather, which hurt running shoe sales
while helping to drive boot sales. During the quarter, 13 stores were closed
or relocated and nine new stores were added.

Wholesale sales of $196.3 million were up 13.5% in the fourth quarter. For the
Healthy Living platform, wholesale sales of $107.2 million were up 4.3%, led
by a double-digit improvement in Naturalizer. The company’s Contemporary
Fashion wholesale sales of $89.1 million were up 28.2% in the fourth quarter, 
with double-digit growth from key brands Sam Edelman and Franco Sarto.

Consolidated gross profit of $241.4 million was down 2.4% in the fourth
quarter, while gross margin increased by 20 basis points to 40.2%. SG&A for
the fourth quarter was $231.2 million, or 38.5% of net sales, which was up 90
basis points from 37.6% of net sales in the prior year. For the quarter,
operating margins declined by 30 basis points year-over-year to 1.7%.

Inventory at the end of the fourth quarter was $547.5 million, up 8.7% from
$503.7 million in the prior year. Wholesale inventory was up 8.7%, while
Famous Footwear inventory was up 8.6%.

At quarter-end, Brown Shoe Company had $7.0 million of borrowings against its
revolving credit facility and $82.5 million in cash and equivalents. Net of
short term borrowings, cash and equivalents were $75.5 million, an improvement
of $112.3 million versus 2012. The company’s debt-to-capital ratio improved to
30.1% from 41.6% in the fourth quarter of 2012.

Full Year Highlights

Famous Footwear reported full year 2013 sales of $1,527.5 million, a 0.9%
year-over-year improvement, while annual operating earnings of $107.1 million
were up 13.8%. For 2013, same-store-sales^(1) were up 2.9% over 2012. During
the year, 62 stores were closed or relocated and 51 new stores were added, as
average revenue per square foot improved to $207.

Wholesale Operations sales of $763.7 million (including $1.6 million of sales
from exited brands) were up 5.3% over $724.9 million in 2013. In the Healthy
Living portfolio, wholesale sales of $421.3 million were up 2.4% in 2013. For
Contemporary Fashion, wholesale sales of $340.8 million were up 12.7%.

For 2013, gross margin of 40.4% improved 50 basis points over 2012. SG&A for
2013 was $909.7 million, or 36.2% of net sales up 20 basis points from 36.0%
in the prior year. Operating earnings improved 32.4% to $98.6 million from
$74.5 million in 2012. For the year, operating margins improved by 90 basis
points to 3.9%. Capital expenditures of $49.2 million were down 22.8% from
$63.7 million in the prior year.

Financial Review and 2014 Outlook

“At Brown Shoe Company, we executed on our strategy in 2013 and improved our
operating performance, delivering steady improvement toward our long term
financial goals by driving sustainable profitability,” said Russ Hammer, chief
financial officer of Brown Shoe Company. “For 2014, we expect to continue to
deliver toward our long term goals, while balancing our realistic outlook in
terms of the economy, the consumer and the weather -- especially this early in
the year. As a result, we believe we will deliver 2014 earnings per share of
$1.45 to $1.55, or a 3% to 10% increase over 2013.”

Guidance Metric                  FY’14
Consolidated net sales           $2.58 to $2.60 billion
Famous Footwear same-store sales Up low-single digits
Specialty Retail net sales       Down low-single digits
Wholesale Operations net sales   Up low- to mid-single digits
Gross margin                     Up approximately 10 bps
SG&A                             $920 to $930 million
Net interest expense             $20 to $21 million
Effective tax rate               33% to 35%
Earnings per diluted share       $1.45 to $1.55
Depreciation and amortization    $51 to $54 million
Capital expenditures             $53 to $57 million

Investor Conference Call

Brown Shoe Company will webcast an investor conference call at 9:00 a.m. ET
today, March 14, 2014. 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 55795350.

A replay will be available for a limited period at
investor.brownshoe.com/news/events/archive. Investors may also access the
replay by dialing (855) 859-2056 in North America or (404) 537-3406
internationally and using the conference ID 55795350 through Friday, March 28,
2014.

(1) Same-Store-Sales: For comparability purposes, same-store-sales for the
fourth quarter of 2013 are calculated based on retail sales for weeks 40
through 52 in 2013 as compared to weeks 41 through 53 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 fourth quarter of 2013 appropriately
reflects the change in same-store-sales on a true retail calendar basis. For
the full year, same-store-sales are based on weeks one to 52 for 2013 versus
weeks two to 53 for 2012.

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.

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 and other countries, where Brown Shoe Company relies
heavily on third-party 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 $2.5 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 over 1,200
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, 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)                 (Unaudited)
                       13 Weeks     14 Weeks     52 Weeks       53 Weeks
                       Ended         Ended         Ended           Ended
(Thousands, except     February 1,   February 2,   February 1,     February 2,
per share data)        2014          2013          2014            2013
                                                                   
Net sales              $ 599,962     $ 618,735     $ 2,513,113     $ 2,477,796
Cost of goods sold      358,555     371,403     1,498,825     1,489,221 
                                                                   
Gross profit            241,407     247,332     1,014,288     988,575   
                                                                   
Selling and
administrative           231,229       232,289       909,749         891,666
expenses
Restructuring and
other special charges,   -             2,771         1,262           22,431
net
Impairment of assets    -           -           4,660         -         
held for sale
                                                                   
Operating earnings      10,178      12,272      98,617        74,478    
                                                                   
Interest expense         (5,087  )     (5,894  )     (21,254   )     (22,973   )
Interest income         95          86          377           322       
                                                                   
Earnings before income
taxes from continuing   5,186       6,464       77,740        51,827    
operations
                                                                   
Income tax benefit      765         (1,381  )    (23,758   )    (16,656   )
(provision)
                                                                   
Net earnings from
continuing              5,951       5,083       53,982        35,171    
operations
                                                                   
Discontinued
operations:
Earnings (loss) from
discontinued
operations, net of tax   210           (1,080  )     (4,574    )     (4,437    )
of $134, $748, $5,922
and $3,066,
respectively
Disposition/impairment
of discontinued
operations, net of tax  -           -           (11,512   )    (3,530    )
of $0, $0, $0 and
$2,247, respectively
                                                                   
Net earnings (loss)
from discontinued       210         (1,080  )    (16,086   )    (7,967    )
operations
                                                                   
Net earnings            6,161       4,003       37,896        27,204    
                                                                   
Net loss attributable
to noncontrolling       (3      )    (36     )    (177      )    (287      )
interests
                                                                   
Net earnings
attributable to Brown  $ 6,164      $ 4,039      $ 38,073       $ 27,491    
Shoe Company, Inc.
                                                                   
Basic earnings
(loss) per common
share:
From continuing        $ 0.14        $ 0.12        $ 1.25          $ 0.83
operations
From discontinued       -           (0.03   )    (0.37     )    (0.19     )
operations
Basic earnings per common share
attributable to
Brown Shoe Company,    $ 0.14       $ 0.09       $ 0.88         $ 0.64      
Inc. shareholders
                                                                   
Diluted earnings
(loss) per common
share:
From continuing        $ 0.14        $ 0.12        $ 1.25          $ 0.83
operations
From discontinued       -           (0.03   )    (0.37     )    (0.19     )
operations
Diluted earnings per common share
attributable to
Brown Shoe Company,    $ 0.14       $ 0.09       $ 0.88         $ 0.64      
Inc. shareholders
                                                                   
Basic number of          41,560        40,774        41,356          40,659
shares
Diluted number of       41,886      41,109      41,653        40,794    
shares

                                                           
SCHEDULE 2
                                                              
BROWN SHOE COMPANY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS                      
                                                              
                                           (Unaudited)
(Thousands)                                February 1, 2014   February 2, 2013
ASSETS
                                                              
Cash and cash equivalents                  $    82,546        $    68,223
Receivables, net                                129,217            111,392
Inventories, net                                547,531            503,688
Prepaid expenses and other current              33,136             44,730
assets
Current assets - discontinued operations       119               44,395
Total current assets                           792,549           772,428
                                                              
Property and equipment, net                     143,560            144,856
Goodwill and intangible assets, net             73,673             79,703
Other assets                                    139,621            119,695
Noncurrent assets - discontinued               -                 54,577
operations
Total assets                               $    1,149,403     $    1,171,259
                                                              
LIABILITIES AND EQUITY
                                                              
Borrowings under revolving credit          $    7,000         $    105,000
agreement
Trade accounts payable                          226,602            213,660
Other accrued expenses                          152,545            139,904
Current liabilities - discontinued             708               10,545
operations
Total current liabilities                      386,855           469,109
                                                              
Long-term debt                                  199,010            198,823
Deferred rent                                   38,593             33,711
Other liabilities                               47,583             36,719
Noncurrent liabilities - discontinued          -                 6,996
operations
Total other liabilities                        285,186           276,249
                                                              
Total Brown Shoe Company, Inc.                  476,699            425,129
shareholders’ equity
Noncontrolling interests                       663               772
Total equity                                   477,362           425,901
Total liabilities and equity               $    1,149,403     $    1,171,259
                                                                   

SCHEDULE 3                                                 
                                                              
BROWN SHOE COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF                       
CASH FLOWS
                                           (Unaudited)
                                           52 Weeks Ended    53 Weeks Ended
(Thousands)                                February 1, 2014   February 2, 2013
OPERATING ACTIVITIES:
Net earnings                               $  37,896          $    27,204
Adjustments to reconcile net earnings to
net cash provided by operating
activities:
Depreciation and amortization                 55,329               54,783
Amortization of debt issuance costs and       2,513                2,561
debt discount
Share-based compensation expense              5,567                6,489
Tax benefit related to share-based plans      (3,439      )        (944      )
Loss on disposal of facilities and            1,697                3,103
equipment
Impairment charges for facilities and         1,636                4,132
equipment
Impairment of assets held for sale            4,660                -
Disposition/impairment of discontinued        11,512               3,530
operations
Net loss on sale of subsidiaries              576                  -
Deferred rent                                 4,882                1,350
Provision for doubtful accounts               551                  360
Changes in operating assets and
liabilities, net of dispositions:
Receivables                                   (17,570     )        27,984
Inventories                                   (44,852     )        28,623
Prepaid expenses and other current and        3,695                12,427
noncurrent assets
Trade accounts payable                        12,951               32,091
Accrued expenses and other liabilities        24,888               (6,090    )
Other, net                                   1,540              334       
Net cash provided by operating               104,032            197,937   
activities
                                                              
INVESTING ACTIVITIES:
Capital expenditures                          (49,203     )        (63,729   )
Net proceeds from sale of subsidiary          69,347               -
Acquisition cost                             -                  (5,000    )
Net cash provided by (used for)              20,144             (68,729   )
investing activities
                                                              
FINANCING ACTIVITIES:
Borrowings under revolving credit             1,129,000            805,000
agreement
Repayments under revolving credit             (1,227,000  )        (901,000  )
agreement
Dividends paid                                (12,105     )        (12,011   )
Issuance of common stock under                804                  (1,700    )
share-based plans, net
Tax benefit related to share-based plans      3,439                944
Contributions by noncontrolling interest     50                 -         
Net cash used for financing activities       (105,812    )       (108,767  )
Effect of exchange rate changes on cash      (4,041      )       100       
and cash equivalents
Increase in cash and cash equivalents         14,323               20,541
Cash and cash equivalents at beginning       68,223             47,682    
of period
                                                              
Cash and cash equivalents at end of        $  82,546         $    68,223    
period
                                                                             

                                                          
SCHEDULE 4
                                                                                       
BROWN SHOE COMPANY, INC.
RECONCILIATION OF NET EARNINGS AND DILUTED EARNINGS PER SHARE (GAAP BASIS) TO ADJUSTED NET
EARNINGS AND ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP BASIS)
                                                                                       
                           (Unaudited)                        (Unaudited)
                           13 Weeks Ended February 1, 2014    14 Weeks Ended February 2, 2013
                           Pre-Tax    Net Earnings                        Net Earnings
                           Impact     Attributable Diluted    Pre-Tax     Attributable Diluted
(Thousands, except per     of        to           Earnings  Impact of   to           Earnings
share data)                Charges/   Brown Shoe   Per        Charges/    Brown Shoe   Per
                           Other      Company,     Share      Other Items Company,     Share
                           Items      Inc.                                Inc.
                                                                                       
GAAP earnings                         $   6,164    $  0.14                $  4,039     $  0.09
                                                                                       
Charges/Other Items -
Continuing Operations:
Portfolio realignment
Business exits and cost    $ -            -           -       $ 2,983        1,851        0.05
reductions
                                                                                       
Charges/Other Items -
Discontinued Operations:
Portfolio realignment
Business exits and cost      -            -           -         (41    )     (24    )     -
reductions
                                                                                  
Total charges/other        $ -        $   -        $  -       $ 2,942    $  1,827      0.05
items
                                                                                       
Adjusted earnings                     $   6,164    $  0.14                $  5,866    $  0.14
                                                                                       
                                                                                       
                           52 Weeks Ended February 1, 2014    53 Weeks Ended February 2, 2013
                           Pre-Tax    Net Earnings                        Net Earnings
                           Impact     Attributable Diluted    Pre-Tax     Attributable Diluted
(Thousands, except per     of        to           Earnings  Impact of   to           Earnings
share data)                Charges/   Brown Shoe   Per        Charges/    Brown Shoe   Per
                           Other      Company,     Share      Other Items Company,     Share
                           Items      Inc.                                Inc.
                                                                                       
GAAP earnings                         $   38,073   $  0.88                $  27,491    $  0.64
                                                                                       
Charges/Other Items -
Continuing Operations:
Portfolio realignment
Business exits and cost    $ 1,262        803         0.02    $ 21,855       14,291       0.33
reductions
Non-cash                     4,660        4,660       0.11      -            -            -
impairments/dispositions
Organizational change       -           -          -        2,283      1,395      0.03
Total Continuing             5,922        5,463       0.13      24,138       15,686       0.36
Operations
                                                                                       
Charges/Other Items -
Discontinued Operations:
Portfolio realignment
Business exits and cost      13,233       6,414       0.13      2,312        1,445        0.04
reductions
Non-cash                     11,512       11,512      0.27      5,777        3,530        0.08
impairments/dispositions
ASG integration-related     -           -          -        675        441        0.01
costs
Total Discontinued           24,745       17,926      0.40      8,764        5,416        0.13
Operations
                                                                                  
Total charges/other        $ 30,667      23,389     0.53    $ 32,902     21,102     0.49
items
                                                                                       
Adjusted earnings                     $   61,462   $  1.41                $  48,593   $  1.13
                                                                                          

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     14 Weeks     13 Weeks     14 Weeks     13 Weeks     14 Weeks     13 Weeks     14 Weeks     13 Weeks     14 Weeks
                 Ended          Ended         Ended         Ended         Ended         Ended         Ended         Ended         Ended         Ended
                 February       February 2,   February 1,   February 2,   February 1,   February 2,   February 1,   February 2,   February 1,   February 2,
                 1,
(Thousands)       2014         2013        2014        2013        2014        2013        2014        2013        2014        2013    
                                                                                                                                                
Net Sales        $ 347,394      $ 380,112     $ 196,336     $ 173,011     $ 56,232      $ 65,612      $ -           $ -           $ 599,962     $ 618,735
                                                                                                                                                
Gross Profit     $ 158,095      $ 167,376     $ 60,334      $ 53,734      $ 22,978      $ 26,222      $ -           $ -           $ 241,407     $ 247,332
Adjusted Gross   $ 158,095      $ 167,376     $ 60,334      $ 53,862      $ 22,978      $ 26,305      $ -           $ -           $ 241,407     $ 247,543
Profit
                                                                                                                                                
Gross Profit       45.5    %      44.0    %     30.7    %     31.1    %     40.9   %      40.0   %      -             -             40.2    %     40.0    %
Rate
Adjusted Gross     45.5    %      44.0    %     30.7    %     31.1    %     40.9   %      40.1   %      -             -             40.2    %     40.0    %
Profit Rate
                                                                                                                                                
Operating
Earnings         $ 12,068       $ 19,731      $ 15,043      $ 4,413       $ (2,031 )    $ (1,299 )    $ (14,902 )   $ (10,573 )   $ 10,178      $ 12,272
(Loss)
Adjusted
Operating        $ 12,068       $ 19,813      $ 15,043      $ 7,123       $ (2,031 )    $ (1,108 )    $ (14,902 )   $ (10,573 )   $ 10,178      $ 15,255
Earnings
(Loss)
                                                                                                                                                
Operating
Earnings           3.5     %      5.2     %     7.7     %     2.6     %     (3.6   %)     (2.0   %)     -             -             1.7     %     2.0     %
(Loss) %
Adjusted
Operating          3.5     %      5.2     %     7.7     %     4.1     %     (3.6   %)     (1.7   %)     -             -             1.7     %     2.5     %
Earnings
(Loss) %
                                                                                                                                                
Same-store
Sales % (on a      (1.8    %)     4.4     %     -             -             1.3    %      (7.1   %)     -             -             -             -
13-week basis)
                                                                                                                                                
Number of          1,044          1,055         -             -             179           222           -             -             1,223         1,277
Stores
                                                                                                                            
                                                                                                                                                

RECONCILIATION
OF ADJUSTED
RESULTS
(NON-GAAP)
                                                                                                                                                
                 Famous Footwear              Wholesale Operations        Specialty Retail            Other                       Consolidated
                 13 Weeks     14 Weeks     13 Weeks     14 Weeks     13 Weeks     14 Weeks     13 Weeks     14 Weeks     13 Weeks     14 Weeks
                 Ended          Ended         Ended         Ended         Ended         Ended         Ended         Ended         Ended         Ended
                 February       February 2,   February 1,   February 2,   February 1,   February 2,   February 1,   February 2,   February 1,   February 2,
                 1,
(Thousands)       2014         2013        2014        2013        2014        2013        2014        2013        2014        2013    
                                                                                                                                                
Gross Profit     $ 158,095      $ 167,376     $ 60,334      $ 53,734      $ 22,978      $ 26,222      $ -           $ -           $ 241,407     $ 247,332
                                                                                                                                                
Charges/Other
Items:
Portfolio
realignment
Business exits
and cost           -              -             -             128           -             83            -             -             -             211
reductions
                                                                                                                                      
Total
charges/other     -            -           -           128         -           83          -           -           -           211     
items
                                                                                                                                                
Adjusted Gross   $ 158,095     $ 167,376    $ 60,334     $ 53,862     $ 22,978     $ 26,305     $ -          $ -          $ 241,407    $ 247,543 
Profit
                                                                                                                                                
                                                                                                                                                
Operating
Earnings         $ 12,068       $ 19,731      $ 15,043      $ 4,413       $ (2,031 )    $ (1,299 )    $ (14,902 )   $ (10,573 )   $ 10,178      $ 12,272
(Loss)
                                                                                                                                                
Charges/Other
Items:
Portfolio
realignment
Business exits
and cost           -              82            -             2,710         -             191           -             -             -             2,983
reductions
                                                                                                                                      
Total
charges/other     -            82          -           2,710       -           191         -           -           -           2,983   
items
                                                                                                                                                
Adjusted
Operating        $ 12,068      $ 19,813     $ 15,043     $ 7,123      $ (2,031 )    $ (1,108 )    $ (14,902 )   $ (10,573 )   $ 10,178     $ 15,255  
Earnings
(Loss)

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

SUMMARY
FINANCIAL
RESULTS
                                                                                                                                                                         
                 Famous Footwear                    Wholesale Operations           Specialty Retail                 Other                        Consolidated
                 52 Weeks Ended    53 Weeks Ended    52 Weeks        53 Weeks        52 Weeks Ended   53 Weeks Ended   52 Weeks        53 Weeks        52 Weeks Ended    53 Weeks
                                                     Ended           Ended                                             Ended           Ended                             Ended
                 February 1,       February 2,       February 1,     February 2,     February 1,      February 2,      February 1,     February 2,     February 1,       February 2,
(Thousands)       2014           2013           2014         2013         2014          2013          2014         2013         2014           2013      
                                                                                                                                                                         
Net Sales        $ 1,527,537       $ 1,514,349       $ 763,670       $ 724,907       $ 221,906        $ 238,540        $ -             $ -             $ 2,513,113       $ 2,477,796
                                                                                                                                                                         
Gross Profit     $ 681,117         $ 666,094         $ 239,192       $ 223,798       $ 93,979         $ 98,683         $ -             $ -             $ 1,014,288       $ 988,575
Adjusted Gross   $ 681,117         $ 666,094         $ 239,192       $ 225,125       $ 93,979         $ 99,062         $ -             $ -             $ 1,014,288       $ 990,281
Profit
                                                                                                                                                                         
Gross Profit       44.6      %       44.0      %       31.3    %       30.9    %       42.4    %        41.4    %        -               -               40.4      %       39.9      %
Rate
Adjusted Gross     44.6      %       44.0      %       31.3    %       31.1    %       42.4    %        41.5    %        -               -               40.4      %       40.0      %
Profit Rate
                                                                                                                                                                         
Operating
Earnings         $ 107,126         $ 94,096          $ 43,130        $ 30,247        $ (4,965  )      $ (8,850  )      $ (46,674 )     $ (41,015 )     $ 98,617          $ 74,478
(Loss)
Adjusted
Operating        $ 107,126         $ 101,865         $ 49,036        $ 39,445        $ (4,965  )      $ (4,755  )      $ (46,658 )     $ (37,939 )     $ 104,539         $ 98,616
Earnings
(Loss)
                                                                                                                                                                         
Operating
Earnings           7.0       %       6.2       %       5.6     %       4.2     %       (2.2    %)       (3.7    %)       -               -               3.9       %       3.0       %
(Loss) %
Adjusted
Operating          7.0       %       6.7       %       6.4     %       5.4     %       (2.2    %)       (2.0    %)       -               -               4.2       %       4.0       %
Earnings
(Loss) %
                                                                                                                                                                         
Same-store
Sales % (on a      2.9       %       4.5       %       -               -               1.6     %        0.6     %        -               -               -                 -
52-week basis)
                                                                                                                                                                         
Number of          1,044             1,055             -               -               179              222              -               -               1,223             1,277
Stores
                                                                                                                                                      
                                                                                                                                                                         

RECONCILIATION
OF ADJUSTED
RESULTS
(NON-GAAP)
                                                                                                                                                                         
                 Famous Footwear                    Wholesale Operations           Specialty Retail                 Other                          Consolidated
                 52 Weeks Ended    53 Weeks Ended    52 Weeks        53 Weeks        52 Weeks Ended   53 Weeks Ended   52 Weeks        53 Weeks        52 Weeks Ended    53 Weeks
                                                     Ended           Ended                                             Ended           Ended                             Ended
                 February 1,       February 2,       February 1,     February 2,     February 1,      February 2,      February 1,     February 2,     February 1,       February 2,
(Thousands)       2014           2013           2014         2013          2014          2013          2014         2013         2014           2013      
                                                                                                                                                                         
Gross Profit     $ 681,117         $ 666,094         $ 239,192       $ 223,798       $ 93,979         $ 98,683         $ -             $ -             $ 1,014,288       $ 988,575
                                                                                                                                                                         
Charges/Other
Items:
Portfolio
realignment
Business exits
and cost           -                 -                 -               1,327           -                379              -               -               -                 1,706
reductions
                                                                                                                                                                
Total
charges/other     -               -               -             1,327         -              379            -             -             -               1,706     
items
                                                                                                                                                                         
Adjusted Gross   $ 681,117        $ 666,094        $ 239,192      $ 225,125      $ 93,979        $ 99,062        $ -            $ -            $ 1,014,288      $ 990,281   
Profit
                                                                                                                                                                         
                                                                                                                                                                         
Operating
Earnings         $ 107,126         $ 94,096          $ 43,130        $ 30,247        $ (4,965  )      $ (8,850  )      $ (46,674 )     $ (41,015 )     $ 98,617          $ 74,478
(Loss)
                                                                                                                                                                         
Charges/Other
Items:
Portfolio
realignment
Non-cash
impairment         -                 -                 4,660           -               -                -                -               -               4,660             -
charges
Business exits
and cost           -                 7,769             1,246           9,198           -                4,095            16              793             1,262             21,855
reductions
Organizational     -                 -                 -               -               -                -                -               2,283           -                 2,283
change
                                                                                                                                                                
Total
charges/other     -               7,769           5,906         9,198         -              4,095          16            3,076         5,922           24,138    
items
                                                                                                                                                                         
Adjusted
Operating        $ 107,126        $ 101,865        $ 49,036       $ 39,445       $ (4,965  )      $ (4,755  )      $ (46,658 )     $ (37,939 )     $ 104,539        $ 98,616    
Earnings
(Loss)

                                                              
SCHEDULE 6
                                                                    
BROWN SHOE COMPANY, INC.
BASIC AND DILUTED EARNINGS (LOSS) PER SHARE RECONCILIATION
                                                                    
                  (Unaudited)                     (Unaudited)
                  13 Weeks       14 Weeks       52 Weeks         53 Weeks
                  Ended           Ended           Ended             Ended
                  February 1,     February 2,     February 1,       February
                                                                    2,
(Thousands,
except per          2014          2013          2014           2013   
share data)
                                                                    
Net earnings
attributable to
Brown Shoe
Company, Inc.:
Net earnings
from continuing   $  5,951        $  5,083        $  53,982         $ 35,171
operations
Net loss
attributable to      3               36              177              287
noncontrolling
interests
Net earnings
allocated to        (235    )      (252    )      (2,304   )      (1,757 )
participating
securities
Net earnings
from continuing     5,719         4,867         51,855         33,701 
operations
                                                                    
Net earnings
(loss) from          210             (1,080  )       (16,086  )       (7,967 )
discontinued
operations
Net (earnings)
loss allocated
to                  (8      )      53            687            392    
participating
securities
Net earnings
(loss) from         202           (1,027  )      (15,399  )      (7,575 )
discontinued
operations
                                                                    
Net earnings
attributable to
Brown Shoe
Company, Inc.
after             $  5,921       $  3,840       $  36,456        $ 26,126 
allocation of
earnings to
participating
securities
                                                                    
                                                                    
Basic and
diluted common
shares
attributable to
Brown Shoe
Company, Inc.:
Basic common
shares for
continuing           41,560          40,774          41,356           40,659
operations and
discontinued
operations
Dilutive effect
of share-based
awards for
continuing          326           335           297            135    
operations and
discontinued
operations
Diluted common
shares for
continuing
operations and
discontinued        41,886        41,109        41,653         40,794 
operations
attributable to
Brown Shoe
Company, Inc.
                                                                    
Basic earnings
(loss) per
common share:
From continuing   $  0.14         $  0.12         $  1.25           $ 0.83
operations
From
discontinued        -             (0.03   )      (0.37    )      (0.19  )
operations
Basic earnings
per common
share
attributable to   $  0.14        $  0.09        $  0.88          $ 0.64   
Brown Shoe
Company, Inc.
shareholders
                                                                    
Diluted
earnings (loss)
per common
share:
From continuing   $  0.14         $  0.12         $  1.25           $ 0.83
operations
From
discontinued        -             (0.03   )      (0.37    )      (0.19  )
operations
Diluted
earnings per
common share
attributable to   $  0.14        $  0.09        $  0.88          $ 0.64   
Brown Shoe
Company, Inc.
shareholders
                                                                    

SCHEDULE 7                                                    
                                                                   
BROWN SHOE
COMPANY, INC.
BASIC AND
DILUTED ADJUSTED
EARNINGS (LOSS)  
PER SHARE
RECONCILIATION
                                                                   
                   (Unaudited)                     (Unaudited)
                   13 Weeks       14 Weeks       52 Weeks       53 Weeks
                   Ended           Ended           Ended           Ended
                   February 1,     February 2,     February 1,     February 2,
(Thousands,
except per share     2014          2013          2014          2013   
data)
                                                                   
Adjusted net
earnings
attributable to
Brown Shoe
Company, Inc.:
Adjusted net
earnings from      $  5,951        $  6,934        $  59,445       $  50,857
continuing
operations
Net loss
attributable to       3               36              177             287
noncontrolling
interests
Net earnings
allocated to         (235    )      (344    )      (2,538  )      (2,529 )
participating
securities
Adjusted net
earnings from        5,719         6,626         57,084        48,615 
continuing
operations
                                                                   
Adjusted net
earnings (loss)
from                  210             (1,104  )       1,840           (2,551 )
discontinued
operations
Net (earnings)
loss allocated       (8      )      55            (79     )      125    
to participating
securities
Net earnings
(loss) from          202           (1,049  )      1,761         (2,426 )
discontinued
operations
                                                                   
Adjusted net
earnings
attributable to
Brown Shoe
Company, Inc.      $  5,921       $  5,577       $  58,845      $  46,189 
after allocation
of earnings to
participating
securities
                                                                   
                                                                   
Basic and
diluted common
shares
attributable to
Brown Shoe
Company, Inc.:
Basic common
shares for
continuing            41,560          40,774          41,356          40,659
operations and
discontinued
operations
Dilutive effect
of share-based
awards for
continuing           326           335           297           135    
operations and
discontinued
operations
Diluted common
shares for
continuing
operations and
discontinued         41,886        41,109        41,653        40,794 
operations
attributable to
Brown Shoe
Company, Inc.
                                                                   
Basic adjusted
earnings (loss)
per common
share:
From continuing    $  0.14         $  0.16         $  1.38         $  1.20
operations
From
discontinued         -             (0.02   )      0.04          (0.06  )
operations
Basic adjusted
earnings per
common share
attributable to    $  0.14        $  0.14        $  1.42        $  1.14   
Brown Shoe
Company, Inc.
shareholders
                                                                   
Diluted adjusted
earnings (loss)
per common
share:
From continuing    $  0.14         $  0.16         $  1.37         $  1.19
operations
From
discontinued         -             (0.02   )      0.04          (0.06  )
operations
Diluted adjusted
earnings per
common share
attributable to    $  0.14        $  0.14        $  1.41        $  1.13   
Brown Shoe
Company, Inc.
shareholders

Contact:

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