Caleres, Inc.

Good morning, and welcome to the Calaris third quarter earnings conference call. My name is Melissa, and I'll be your conference coordinator. At this time, all participants are in a listen-only mode. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. At this time, I'd like to turn the call over to Logan Bonacosti, Vice President of Investor Relations. Please go ahead, Miss.

Good morning. I would like to thank you for joining our third quarter 2022 earnings call and webcast. A press release with detailed financial tables, as well as our quarterly slide presentation, are available at calaris.com. Please be aware today's discussion contains forward-looking statements, which are subject to a number of risks and uncertainties. Actual results may differ materially due to various risk factors, including but not limited to the factors disclosed in the company's Form 10-K and other filings with the U.S. Securities and Exchange Commission. Please refer to today's press release and our SEC filings for more information on risk factors and other factors which could impact forward-looking statements. Copies of these reports are available online. In discussing the results of our operations, we will be providing and referring to certain non-GAAP financial measures. You can find additional information regarding these non-GAAP financial measures as well as others used in today's earnings release and our presentation on the investor section of our website. The company undertakes no obligation to update any information discussed in this call at any time. Joining me on the call today is Diane Sullivan, Chairman and CEO, Jay Schmidt, President, and Jack Calandra, Senior Vice President and CFO. We will begin this morning's call with our prepared remarks and thereafter we will be happy to take your questions. I would now like to turn the call over to Diane. Diane?

Thank you, Logan, and good morning, everyone. It's an exciting time at Calaris with our team's energy running high as our momentum continues. Today, I'm very happy to report that Calaris continued its strong performance in the third quarter of 2022. We built on our excellent first half results, which were driven by another period of outstanding operational and financial execution. These results are further proof of the strength of our brands, of our compelling product and product creation power, of our disciplined inventory management, and of course, the agility and resiliency of our operating model that is showing strength. For the third quarter, and even as the consumer navigates this challenging macroeconomic environment, we achieved record quarterly sales of 798 million, nearly 2% higher than the third quarter of 2021. with improvement once again driven by a 7.6% year-over-year increase from the brand portfolio segment. And we delivered another strong return on sales, reaching more than 7% as the brand portfolio recorded robust third quarter earnings. And Famous held its operating margin in the double digits, achieving 12.3%. And all in, this generated operating earnings of $57 million and earnings per share of $1.15. I will note that at $1.15, we've ended the first nine months of 2022 with $3.86 of earnings per share, or $1.66 above our pre-pandemic record. In addition, during the period, we also grew total Calaris market share, We continue to manage our inventory well and ultimately ended the period nearly 16% lower than the second quarter of 2022. And we returned 24 million to our shareholders through share repurchases and dividends. All in excellent results with a team that is determined to continue to drive this momentum. Now, as you know, this will be the last time that I speak with all of you as CEOs, as I will transition to executive chairman in mid-January. I cannot express how much of an honor serving as CEO of Calaris has been for me. I'm proud of what we've accomplished and proud of the diversified portfolio, the consumer and product-driven organization, and the inclusive culture that we've built during that time. You can absolutely count on the fact that the strategic focus areas of delighting consumers, building product that fits and is relevant, creating inspiring experience and engaged teams are well embedded into the fabric of who we are. That will never change. I want to thank my leadership team for their collaboration, creativity and drive for results and of course their commitment to all of our colleagues, consumers and our partners. And I want to thank all of you in the investment community for your interest and support of me and our organization. To say that I'm excited about the future of Calaris would be an understatement. I see tremendous potential for the earnings power of the company. In fact, with the record earnings performance in 21 and our expectations for another record this year, I am confident our pre-pandemic earnings level is firmly in the rear view. Furthermore, I believe in the resiliency in the portfolio, and I'm completely confident in our ability to create long-term value for our many stakeholders. I believe our expertise and capabilities in brand building and product creation, marketing, digital commerce, and our supply chain management provide a unique foundation from which to continue to build. And I'm also confident that this will be a successful executive transition. As you well know, Jay and I have been working side by side for many years. And I can say that without reservation, he has an unending commitment to excellence. He knows the footwear category, our business, and our consumers very well. And he is ideally suited to lead the organization through its next chapter. And his leadership roles, numerous ones at Calaris, and his distinctive merchant mind, have prepared him well to steer the company into the future. And although many of you may have met him by now, I would like to take a moment to introduce Jack as well, who joined us in September as CFO and is joining his first Calaris Quarterly Earnings Call today. As you get to know Jack in this role, I'm confident that you'll be impressed by his strong financial background and his consumer goods expertise. As you can imagine, this next step in my personal career is as exciting as it is bittersweet. That said, I'm thrilled to move to my new role as Executive Chairman, and I look forward to supporting JJAC and the rest of the Calaris leadership team as they build on what we've accomplished together. And I also look forward to focusing on continuing to enhance the Calaris culture, drive strategic initiatives to unlock growth, and assist in ensuring we have a value-enhancing pipeline of growth opportunities ready for when the timing is right. Now I'll turn the call over to Jay to share more details about our third quarter results. Jay?