ACQUISITION

12 Months Ended

Jan. 31, 2026

ACQUISITION

ACQUISITION

3.    ACQUISITION

On February 16, 2025, the Company entered into a Sale and Purchase Agreement with Tapestry, Inc. (“Tapestry”) to acquire the Stuart Weitzman business (the “Acquisition”).  On August 4, 2025, the Company completed the Acquisition pursuant to the terms and conditions of that Sale and Purchase Agreement, as amended.  The aggregate purchase price for

the Acquisition was $108.9 million, net of the cash received at the closing.  The purchase price is subject to final adjustments for net working capital.  

Stuart Weitzman, which includes both wholesale and direct-to-consumer channels, has been an iconic global luxury women’s footwear brand for over 35 years.  The Acquisition strengthens the Company’s position in the global footwear market and adds an iconic name in luxury footwear to the Brand Portfolio segment.  Stuart Weitzman maintains a strong presence in North America, Europe and Asia across both wholesale and direct-to-consumer channels.  The acquisition was funded with borrowings from the revolving credit agreement.  

Preliminary Purchase Price Allocation

The acquisition was accounted for in accordance with ASC Topic 805, Business Combinations.  Accordingly, the assets and liabilities of Stuart Weitzman were recorded at their estimated fair values, and the excess of the purchase price over the fair value of the assets acquired and liabilities assumed, including identified intangible assets, was recorded as goodwill.  The following table summarizes the Company’s preliminary allocation of the purchase price as of the acquisition date:

($ thousands)	August 4, 2025
Assets
Current assets:
Cash and cash equivalents	$	10,683
Receivables		14,220
Inventories		84,472
Prepaid expenses and other current assets		10,607
Total current assets		119,982
Lease right-of-use assets		21,293
Property and equipment		7,899
Goodwill		10,430
Intangible assets		12,800
Other assets		2,241
Total assets	$	174,645
Liabilities and Equity
Current liabilities:
Trade accounts payable		5,458
Lease obligations		10,279
Other accrued expenses		21,745
Total current liabilities		37,482
Other liabilities:
Noncurrent lease obligations		16,496
Other liabilities		1,126
Total other liabilities		17,622
Net assets	$	119,541

The allocation of the purchase price was based on certain preliminary valuations and analyses. Any subsequent changes in the estimated fair values assumed upon the finalization of more detailed analyses within the measurement period will change the allocation of the purchase price and will be adjusted during the period in which the amounts are determined. The Company’s purchase price allocation required management to make assumptions and to apply judgment to estimate the fair value of the acquired assets and liabilities. A single estimate of fair value results from a complex series of judgments

about future events and uncertainties and relies heavily on estimates and assumptions. The judgments the Company used in estimating the fair values assigned to each class of the acquired assets and assumed liabilities could materially affect the results of its operations. Management estimated the fair value of the assets and liabilities based upon quoted market prices, the carrying value of the acquired assets and widely accepted valuation techniques, including discounted cash flows (Level 3 fair value measurements). A third-party valuation specialist assisted the Company with its preliminary fair value estimates for inventory, right-of-use lease assets and intangible assets. The Company used all available information to make its best estimate of fair values at the acquisition date.  During the fourth quarter of 2025, the Company recorded measurement period adjustments totaling $3.8 million, including a $2.3 million decrease to inventories, $1.3 million increase to other accrued expenses, $0.4 million decrease in right-of-use assets, $0.3 million increase to other assets, $0.2 million decrease to prepaid expenses and other current assets and $0.1 million increase in intangible assets.   The Company is still in the process of finalizing the net working capital adjustment, which is expected to be completed during the first quarter of 2026.

Goodwill and intangible assets reflected above were determined to meet the criteria for recognition apart from tangible assets acquired and liabilities assumed. The goodwill recognized, which is deductible for tax purposes, is primarily attributable to synergies and an assembled workforce.  Refer to Note 9 to the consolidated financial statements for additional information regarding goodwill and intangible assets.

The financial results of Stuart Weitzman are included in the Brand Portfolio segment beginning in the third quarter of 2025.  Stuart Weitzman contributed net sales of $102.2 million and reported an operating loss of $38.9 million during 2025.  The operating loss is due in part to $15.4 million in incremental cost of goods sold during 2025 related to the inventory fair value adjustment required for purchase accounting.  The operating loss does not include $12.2 million ($9.1 million on an after-tax basis, or $0.27 per diluted share) in acquisition and integration-related costs during 2025, and the incremental interest expense associated with the transaction.  Refer to Note 5 to the consolidated financial statements for additional information related to the acquisition and integration costs and Note 11 for discussion of the intangible assets acquired.

Unaudited Pro Forma Financial Information

The following unaudited pro forma financial information for 2025 and 2024 combines the historical results of Caleres, Inc. and Stuart Weitzman, assuming the acquisition had been completed as of February 4, 2024. The pro forma financial information includes various adjustments to reflect business combination accounting effects, including the incremental cost of goods sold related to the fair value step-up adjustment on inventory, acquisition and integration-related transaction costs, interest expense on incremental borrowings on the revolving credit agreement to fund the acquisition and amortization on the acquired intangible assets, and tax-related effects of the adjustments. The pro forma financial information, as presented below, is for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place on February 4, 2024, nor are they indicative of future operating results.

($ thousands)		2025		2024
Net sales	$	2,848,764	$	2,947,715
Net earnings attributable to Caleres, Inc.	$	5,509	$	61,758

The above unaudited pro forma financial information is presented for informational purposes only and does not purport to represent what the results of operations would have been had the Company completed the acquisition on the date assumed, nor is it necessarily indicative of the results of operations that may be expected in future periods.