Financial Information for the Company and its Subsidiaries

12 Months Ended

Feb. 03, 2018

Financial Information For The Company And Its Subsidiaries [Abstract]

Financial Information for the Company and its Subsidiaries

FINANCIAL INFORMATION FOR THE COMPANY AND ITS SUBSIDIARIES

The Company's 2023 Senior Notes are fully and unconditionally and jointly and severally guaranteed by all of its existing and future subsidiaries that are guarantors under the Credit Agreement, as further discussed in Note 11 to the consolidated financial statements. The following table presents the condensed consolidating financial information for each of Caleres, Inc. (“Parent”), the Guarantors, and subsidiaries of the Parent that are not Guarantors (the “Non-Guarantors”), together with consolidating eliminations, as of and for the periods indicated. Guarantors are 100% owned by the Parent. On December 13, 2016, Allen Edmonds was joined to the Credit Agreement as a guarantor. After giving effect to the joinder, the Company is the lead borrower, and Sidney Rich Associates, Inc., BG Retail, LLC and Allen Edmonds are each co-borrowers and guarantors under the Credit Agreement.

The condensed consolidating financial statements have been prepared using the equity method of accounting in accordance with the requirements for presentation of such information. Management believes that the information, presented in lieu of complete financial statements for each of the Guarantors, provides meaningful information to allow investors to determine the nature of the assets held by, and operations and cash flows of, each of the consolidated groups.

CONDENSED CONSOLIDATING BALANCE SHEET
AS OF FEBRUARY 3, 2018
					Non-Guarantors
($ thousands)	Parent		Guarantors					Eliminations			Total
Assets
Current assets:
Cash and cash equivalents	$	26,089	$	—	$	37,958		$	—		$	64,047
Receivables, net	124,957		3,663		23,993			—			152,613
Inventories, net	146,068		394,438		28,873			—			569,379
Prepaid expenses and other current assets	26,284		30,456		8,394			(4,384		)	60,750
Intercompany receivable - current	521		74		9,250			(9,845		)	—
Total current assets	323,919		428,631		108,468			(14,229		)	846,789
Property and equipment, net	35,474		165,227		12,098			—			212,799
Goodwill and intangible assets, net	111,108		40,937		187,123			—			339,168
Other assets	76,317		13,610		732			—			90,659
Investment in subsidiaries	1,329,428		—		(23,565		)	(1,305,863		)	—
Intercompany receivable - noncurrent	774,588		520,362		704,810			(1,999,760		)	—
Total assets	$	2,650,834	$	1,168,767	$	989,666		$	(3,319,852	)	$	1,489,415
Liabilities and Equity
Current liabilities:
Trade accounts payable	$	136,797	$	102,420	$	33,745		$	—		$	272,962
Other accrued expenses	65,817		74,006		21,758			(4,384		)	157,197
Intercompany payable - current	5,524		—		4,321			(9,845		)	—
Total current liabilities	208,138		176,426		59,824			(14,229		)	430,159
Other liabilities:
Long-term debt	197,472		—		—			—			197,472
Other liabilities	101,784		35,574		5,464			—			142,822
Intercompany payable - noncurrent	1,425,951		98,610		475,199			(1,999,760		)	—
Total other liabilities	1,725,207		134,184		480,663			(1,999,760		)	340,294
Equity:
Caleres, Inc. shareholders’ equity	717,489		858,157		447,706			(1,305,863		)	717,489
Noncontrolling interests	—		—		1,473			—			1,473
Total equity	717,489		858,157		449,179			(1,305,863		)	718,962
Total liabilities and equity	$	2,650,834	$	1,168,767	$	989,666		$	(3,319,852	)	$	1,489,415

CONDENSED CONSOLIDATING STATEMENT OF EARNINGS
FOR THE FISCAL YEAR ENDED FEBRUARY 3, 2018
($ thousands)	Parent			Guarantors			Non-Guarantors			Eliminations			Total
Net sales	$	837,849		$	1,935,265		$	211,815		$	(199,345	)	$	2,785,584
Cost of goods sold	580,038			1,090,354			109,104			(162,561		)	1,616,935
Gross profit	257,811			844,911			102,711			(36,784		)	1,168,649
Selling and administrative expenses	233,860			771,027			55,600			(36,784		)	1,023,703
Restructuring and other special charges, net	3,942			756			217			—			4,915
Operating earnings	20,009			73,128			46,894			—			140,031
Interest expense	(18,075		)	(14		)	—			—			(18,089		)
Interest income	332			—			432			—			764
Intercompany interest income (expense)	8,354			(8,813		)	459			—			—
Earnings before income taxes	10,620			64,301			47,785			—			122,706
Income tax provision	(24,963		)	(175		)	(10,337		)	—			(35,475		)
Equity in earnings (loss) of subsidiaries, net of tax	101,543			—			(1,619		)	(99,924		)	—
Net earnings	87,200			64,126			35,829			(99,924		)	87,231
Less: Net earnings attributable to noncontrolling interests	—			—			31			—			31
Net earnings attributable to Caleres, Inc.	$	87,200		$	64,126		$	35,798		$	(99,924	)	$	87,200

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME
FOR THE FISCAL YEAR ENDED FEBRUARY 3, 2018
					Non-Guarantors
($ thousands)	Parent		Guarantors					Eliminations			Total
Net earnings	$	87,200	$	64,126	$	35,829		$	(99,924	)	$	87,231
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment	—		—		1,116			—			1,116
Pension and other postretirement benefits adjustments	18,855		—		(61		)	—			18,794
Derivative financial instruments	1,539		14		(452		)	—			1,101
Other comprehensive income from investment in subsidiaries	544		—		—			(544		)	—
Other comprehensive income, net of tax	20,938		14		603			(544		)	21,011
Comprehensive income	108,138		64,140		36,432			(100,468		)	108,242
Comprehensive income attributable to noncontrolling interests	—		—		104			—			104
Comprehensive income attributable to Caleres, Inc.	$	108,138	$	64,140	$	36,328		$	(100,468	)	$	108,138

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE FISCAL YEAR ENDED FEBRUARY 3, 2018
							Non-Guarantors
($ thousands)	Parent			Guarantors						Eliminations		Total
Net cash provided by operating activities	$	40,601		$	90,745		$	60,029		$	—	$	191,375
Investing activities
Purchases of property and equipment	(9,522		)	(31,159		)	(4,039		)	—		(44,720		)
Capitalized software	(5,950		)	(483		)	(25		)	—		(6,458		)
Intercompany investing	(20,224		)	197,929			(177,705		)	—		—
Net cash (used for) provided by investing activities	(35,696		)	166,287			(181,769		)	—		(51,178		)
Financing activities
Borrowings under revolving credit agreement	454,000			—			—			—		454,000
Repayments under revolving credit agreement	(564,000		)	—			—			—		(564,000		)
Dividends paid	(12,027		)	—			—			—		(12,027		)
Acquisition of treasury stock	(5,993		)	—			—			—		(5,993		)
Issuance of common stock under share-based plans, net	(3,816		)	—			—			—		(3,816		)
Intercompany financing	129,021			(266,061		)	137,040			—		—
Net cash (used for) provided by financing activities	(2,815		)	(266,061		)	137,040			—		(131,836		)
Effect of exchange rate changes on cash and cash equivalents	—			—			354			—		354
Increase (decrease) in cash and cash equivalents	2,090			(9,029		)	15,654			—		8,715
Cash and cash equivalents at beginning of year	23,999			9,029			22,304			—		55,332
Cash and cash equivalents at end of year	$	26,089		$	—		$	37,958		$	—	$	64,047

CONDENSED CONSOLIDATING BALANCE SHEET
AS OF JANUARY 28, 2017
					Non- Guarantors
($ thousands)	Parent		Guarantors					Eliminations			Total
Assets
Current assets:
Cash and cash equivalents	$	23,999	$	9,029	$	22,304		$	—		$	55,332
Receivables, net	118,746		5,414		28,961			—			153,121
Inventories, net	150,098		410,867		24,799			—			585,764
Prepaid expenses and other current assets	24,293		23,040		8,058			(5,863		)	49,528
Intercompany receivable - current	695		263		22,091			(23,049		)	—
Total current assets	317,831		448,613		106,213			(28,912		)	843,745
Property and equipment, net	31,424		176,358		11,414			—			219,196
Goodwill and intangible assets, net	113,333		219,337		11,088			—			343,758
Other assets	51,181		16,567		826			—			68,574
Investment in subsidiaries	1,343,954		—		(21,946		)	(1,322,008		)	—
Intercompany receivable - noncurrent	568,541		366,902		581,624			(1,517,067		)	—
Total assets	$	2,426,264	$	1,227,777	$	689,219		$	(2,867,987	)	$	1,475,273
Liabilities and Equity
Current liabilities:
Borrowings under revolving credit agreement	$	110,000	$	—	$	—		$	—		$	110,000
Trade accounts payable	116,783		112,434		37,153			—			266,370
Other accrued expenses	74,941		65,228		16,919			(5,863		)	151,225
Intercompany payable - current	12,794		—		10,255			(23,049		)	—
Total current liabilities	314,518		177,662		64,327			(28,912		)	527,595
Other liabilities:
Long-term debt	197,003		—		—			—			197,003
Other liabilities	91,683		40,507		3,999			—			136,189
Intercompany payable - noncurrent	1,209,943		98,982		208,142			(1,517,067		)	—
Total other liabilities	1,498,629		139,489		212,141			(1,517,067		)	333,192
Equity:
Caleres, Inc. shareholders’ equity	613,117		910,626		411,382			(1,322,008		)	613,117
Noncontrolling interests	—		—		1,369			—			1,369
Total equity	613,117		910,626		412,751			(1,322,008		)	614,486
Total liabilities and equity	$	2,426,264	$	1,227,777	$	689,219		$	(2,867,987	)	$	1,475,273

CONDENSED CONSOLIDATING STATEMENT OF EARNINGS
FOR THE FISCAL YEAR ENDED JANUARY 28, 2017
							Non-Guarantors
($ thousands)	Parent			Guarantors						Eliminations			Total
Net sales	$	825,654		$	1,692,093		$	227,557		$	(165,916	)	$	2,579,388
Cost of goods sold	583,131			938,169			129,410			(133,313		)	1,517,397
Gross profit	242,523			753,924			98,147			(32,603		)	1,061,991
Selling and administrative expenses	212,156			690,292			57,757			(32,603		)	927,602
Restructuring and other special charges, net	15,333			433			7,638			—			23,404
Operating earnings	15,034			63,199			32,752			—			110,985
Interest expense	(15,102		)	(9		)	—			—			(15,111		)
Interest income	811			—			569			—			1,380
Intercompany interest income (expense)	8,888			(9,033		)	145			—			—
Earnings before income taxes	9,631			54,157			33,466			—			97,254
Income tax provision	(5,075		)	(20,084		)	(6,009		)	—			(31,168		)
Equity in earnings (loss) of subsidiaries, net of tax	61,102			—			(2,422		)	(58,680		)	—
Net earnings	65,658			34,073			25,035			(58,680		)	66,086
Less: Net earnings attributable to noncontrolling interests	—			—			428			—			428
Net earnings attributable to Caleres, Inc.	$	65,658		$	34,073		$	24,607		$	(58,680	)	$	65,658

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME
FOR THE FISCAL YEAR ENDED JANUARY 28, 2017
						Non-Guarantors
($ thousands)	Parent			Guarantors					Eliminations			Total
Net earnings	$	65,658		$	34,073	$	25,035		$	(58,680	)	$	66,086
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment	—			—		1,045			—			1,045
Pension and other postretirement benefits adjustments	(24,790		)	—		62			—			(24,728		)
Derivative financial instruments	181			—		(1,115		)	—			(934		)
Other comprehensive income from investment in subsidiaries	39			—		—			(39		)	—
Other comprehensive loss, net of tax	(24,570		)	—		(8		)	(39		)	(24,617		)
Comprehensive income	41,088			34,073		25,027			(58,719		)	41,469
Comprehensive income attributable to noncontrolling interests	—			—		381			—			381
Comprehensive income attributable to Caleres, Inc.	$	41,088		$	34,073	$	24,646		$	(58,719	)	$	41,088

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE FISCAL YEAR ENDED JANUARY 28, 2017
							Non-Guarantors
($ thousands)	Parent			Guarantors						Eliminations		Total
Net cash provided by operating activities	$	66,800		$	71,781		$	45,041		$	—	$	183,622
Investing activities
Purchases of property and equipment	(4,769		)	(41,606		)	(4,148		)	—		(50,523		)
Capitalized software	(5,521		)	(3,481		)	(37		)	—		(9,039		)
Acquisition cost, net of cash received	(259,932		)	—			—			—		(259,932		)
Intercompany investing	(3,257		)	3,257			—			—		—
Net cash used for investing activities	(273,479		)	(41,830		)	(4,185		)	—		(319,494		)
Financing activities
Borrowings under revolving credit agreement	623,000			—			—			—		623,000
Repayments under revolving credit agreement	(513,000		)	—			—			—		(513,000		)
Dividends paid	(12,104		)	—			—			—		(12,104		)
Acquisition of treasury stock	(23,139		)	—			—			—		(23,139		)
Issuance of common stock under share-based plans, net	(4,188		)	—			—			—		(4,188		)
Excess tax benefit related to share-based plans	2,251			—			—			—		2,251
Intercompany financing	126,858			(20,922		)	(105,936		)	—		—
Net cash provided by (used for) financing activities	199,678			(20,922		)	(105,936		)	—		72,820
Effect of exchange rate changes on cash and cash equivalents	—			—			233			—		233
(Decrease) increase in cash and cash equivalents	(7,001		)	9,029			(64,847		)	—		(62,819		)
Cash and cash equivalents at beginning of year	31,000			—			87,151			—		118,151
Cash and cash equivalents at end of year	$	23,999		$	9,029		$	22,304		—		$	55,332

CONDENSED CONSOLIDATING STATEMENT OF EARNINGS
FOR THE FISCAL YEAR ENDED JANUARY 30, 2016
							Non-Guarantors
($ thousands)	Parent			Guarantors						Eliminations			Total
Net sales	$	819,148		$	1,652,444		$	268,779		$	(162,941	)	$	2,577,430
Cost of goods sold	591,539			905,412			162,384			(129,708		)	1,529,627
Gross profit	227,609			747,032			106,395			(33,233		)	1,047,803
Selling and administrative expenses	235,210			649,020			61,699			(33,233		)	912,696
Operating (loss) earnings	(7,601		)	98,012			44,696			—			135,107
Interest expense	(16,588		)	(1		)	—			—			(16,589		)
Loss on early extinguishment of debt	(10,651		)	—			—			—			(10,651		)
Interest income	695			—			204			—			899
Intercompany interest income (expense)	14,363			(14,581		)	218			—			—
(Loss) earnings before income taxes	(19,782		)	83,430			45,118			—			108,766
Income tax benefit (provision)	8,755			(29,475		)	(6,222		)	—			(26,942		)
Equity in earnings (loss) of subsidiaries, net of tax	92,506			—			(616		)	(91,890		)	—
Net earnings	81,479			53,955			38,280			(91,890		)	81,824
Less: Net earnings attributable to noncontrolling interests	—			—			345			—			345
Net earnings attributable to Caleres, Inc.	$	81,479		$	53,955		$	37,935		$	(91,890	)	$	81,479

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME
FOR THE FISCAL YEAR ENDED JANUARY 30, 2016
						Non-Guarantors
($ thousands)	Parent			Guarantors					Eliminations			Total
Net earnings	$	81,479		$	53,955	$	38,280		$	(91,890	)	$	81,824
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment	—			—		(224		)	—			(224		)
Pension and other postretirement benefits adjustments	(8,838		)	—		249			—			(8,589		)
Derivative financial instruments	628			—		(460		)	—			168
Other comprehensive loss from investment in subsidiaries	(366		)	—		—			366			—
Other comprehensive loss, net of tax	(8,576		)	—		(435		)	366			(8,645		)
Comprehensive income	72,903			53,955		37,845			(91,524		)	73,179
Comprehensive income attributable to noncontrolling interests	—			—		276			—			276
Comprehensive income attributable to Caleres, Inc.	$	72,903		$	53,955	$	37,569		$	(91,524	)	$	72,903

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE FISCAL YEAR ENDED JANUARY 30, 2016
							Non-Guarantors
($ thousands)	Parent			Guarantors						Eliminations		Total
Net cash (used for) provided by operating activities	$	(1,259	)	$	99,222		$	51,189		$	—	$	149,152
Investing activities
Purchases of property and equipment	(14,585		)	(56,382		)	(2,512		)	—		(73,479		)
Proceeds from disposal of property and equipment	7,111			—			322			—		7,433
Capitalized software	(5,197		)	(2,538		)	—			—		(7,735		)
Intercompany investing	(568		)	568			—			—		—
Net cash used for investing activities	(13,239		)	(58,352		)	(2,190		)	—		(73,781		)
Financing activities
Borrowings under revolving credit agreement	198,000			—			—			—		198,000
Repayments under revolving credit agreement	(198,000		)	—			—			—		(198,000		)
Proceeds from issuance of 2023 senior notes	200,000			—			—			—		200,000
Redemption of 2019 senior notes	(200,000		)	—			—			—		(200,000		)
Dividends paid	(12,253		)	—			—			—		(12,253		)
Debt issuance costs	(3,650		)	—			—			—		(3,650		)
Acquisition of treasury stock	(4,921		)	—			—			—		(4,921		)
Issuance of common stock under share-based plans, net	(5,297		)	—			—			—		(5,297		)
Excess tax benefit related to share-based plans	2,651			—			—			—		2,651
Intercompany financing	55,077			(40,870		)	(14,207		)	—		—
Net cash provided by (used for) financing activities	31,607			(40,870		)	(14,207		)	—		(23,470		)
Effect of exchange rate changes on cash and cash equivalents	—			—			(1,153		)	—		(1,153		)
Increase in cash and cash equivalents	17,109			—			33,639			—		50,748
Cash and cash equivalents at beginning of year	13,891			—			53,512			—		67,403
Cash and cash equivalents at end of year	$	31,000		$	—		$	87,151		$	—	$	118,151