Shoe Carnival gave a deeper look at its rebanner strategy on Thursday during its third-quarter earnings report.
The Fort Mill, S.C.-based footwear retailer reported that net income in the third quarter was $14.6 million, or 53 cents per diluted share, compared to $19.2 million, or 70 cents per diluted share in the prior year.
Net sales were $297.2 million compared to $306.9 million in third quarter 2024, a decrease of 3.2 percent.
By banner, the company noted that Q3 trends continued to highlight the strength of its “One Banner” strategy, with Shoe Station net sales growing 5.3 percent in the period and Shoe Carnival net sales declining 5.2 percent as lower-income consumers remained pressured. At Rogan’s, net sales exceeded $21 million in Q3, consistent with integration plans.
These results come one week after the company announced that its board of directors unanimously approved changing the corporate name to Shoe Station Group. The name change is subject to shareholder approval at the annual meeting in June 2026.
As of Nov. 20, Shoe Station represents 144 stores and 34 percent of the company’s 428-store fleet, up from 10 percent at the start of fiscal 2025. The company completed integration of its 28-store Rogan’s acquisition into the Shoe Station banner in October 2025. Beginning in fourth quarter 2025, the company noted that Rogan’s results will be reported as part of Shoe Station.
The company added that it is on track to operate 215 Shoe Station stores by back-to-school 2026, representing 51 percent of the fleet. It noted that it expects well over 90 percent of its fleet to operate as Shoe Station before the end of fiscal 2028, with remaining locations evaluated for rebannering, outlet repositioning, or closure.
The transition to Shoe Station as the primary operating banner is expected to deliver $20 million in annual cost savings from reduced dual-brand complexity across merchandising, marketing, systems, supply chain, and back office; $100 million reduction in inventory investment (20-25 percent) as Shoe Station’s merchandising model requires less inventory per store to deliver a superior customer experience; and a return to comparable store sales growth as Shoe Station becomes the dominant banner.
To reach the critical 51 percent Shoe Station threshold by back-to-school 2026, the company expects to rebanner 70 stores, requiring capital expenditures of $25 million to $35 million and rebanner investment of $25 million to $30 million. This rebanner investment includes lost sales, store closing costs, including inventory liquidation, additional depreciation, customer acquisition costs and other costs. The company continues to expect payback of this investment within two to three years following each store’s conversion.
“Third quarter results exceeded expectations,” said Mark Worden, president and chief executive officer, in a statement. “Shoe Station is winning – up over 5 percent in sales with 260 basis point margin expansion. We’re consolidating to one brand because the performance gap is undeniable.”
Looking ahead, Shoe Carnival reaffirmed its yearly guidance of net sales in fiscal 2025 between $1.12 billion to $1.15 billion.
In fiscal 2026, the company expects net sales to decline low-to-mid single digits in the first half before returning to flat-to-low single digit growth in the second half as Shoe Station surpasses 51 percent of the fleet.
The company also expects earnings per share in fiscal 2026 will be lower than fiscal 2025 due to lower sales and store investments. Approximately $50 million to $60 million in inventory reduction is expected in fiscal 2026, which more than fully funds the rebanner capital expenditures.
