Exhibit 99.1 - Slide Presentation

EX-99.1 2 bws8k031306ex99_1.htm EXHIBIT 99.1 - SLIDE PRESENTATION Exhibit 99.1 - Slide Presentation

Famous Footwear

Naturalizer

Franco Sarto

LifeStride

Via Spiga

Bass

Etienne Aigner

Dr. Scholl’s Original

Carlos

By Carlos Santana

Nickels Soft

HotKiss

Buster Brown

Shoes.com

Shoes.com

This presentation by Brown Shoe Company, Inc. contains certain forward-looking statements,including without limitation, statements made concerning forward looking guidance on Sales, Operating Earnings and future growth segments of the business. Such statements are subject to various risks and uncertainties that could cause actual results to differ materially. These include (i) general economic conditions and the consumer’s preferences and purchasing patterns, which may be influenced by consumers' disposable income; (ii) the uncertainties of pending litigation; (iii) intense competition and continuing consolidation within the footwear industry; (iv) political and economic conditions or other threats to continued and uninterrupted flow of inventory from China and Brazil, where the Company relies heavily on third-party manufacturing facilities for a significant amount of its inventory; (v) the integration of the Bennett business; and (vi) the Company’s ability to successfully implement its plan to strengthen the Naturalizer brand. The Company's reports to the Securities and Exchange Commission contain detailed information relating to such factors. Some of the statements herein, as indicated, speak only as of the date they were initially made. The Company does not undertake any obligation or plan to update these forward-looking statements, even though its situation may change.

— March 14, 2006

Agenda - NYSE: BWS

1) Reshaping our platform

2) Brown Shoe today

3) 2005 accomplishments

4) Strategies for long-term growth - 2006 Guidance

Reshaped our Platform - 2001 - 2005

5.8%

6.4%

7.6% 7.9%

12.2%

0.0%

2.5%

5.0%

7.5%

10.0%

12.5%

2001 2002 2003 2004 2005-

LTM

Department Store Market

Share Improvement at

Wholesale*

500

1,000

1,500

2,000

2001 2002 2003 2004 2005

Sales and Operating

Earnings Improvement

for BWS (millions $)

Operating

Earnings

0.7%

4.2%

4.8%

5.4% 5.6%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

2001 2002 2003 2004 2005

Operating Margin

Improvement at Famous

Footwear

§ Net sales increased

$1.76 à $2.29 billion

§ Operating earnings

$11 à $89 million

§ Operating margin

approaching 6% at

Famous Footwear

§ Wholesale market

share in dept. stores

more than doubled

* Reflects NPD Group Reported POS Dollar Volume. 12 Months ending January 2006.

Sales

Brown Shoe Today -- $2.5 Billion in Sales Projected for 2006

Unique wholesale-retail platform. Building our brands and retail concepts to gain

market share while delivering style to the consumer.

Department &

Specialty Stores

$650 million

Mass

Merchandisers

$300 million

Specialty

Retail

$250

million

950 retail stores

in the U.S.

$1.3 billion

39% Wholesale

§ 80 million pairs

§ 2000 retail

customers

61% Retail

§ 1300 stores

§ 120 million consumers

visit our stores/year

§ 9 e-commerce sites

§ 30+ million e-visitors/year

$100

$200

$300

$400

$500

$600

Nine West Group

Brown Shoe

Clarks Companies

Steve Madden

VCS Group

Nike

Kenneth Cole Productions

Liz Claiborne

H H Brown

Overview of our Branded Wholesale Business:

* Reflects NPD Group Reported POS Dollar Volume. 12 Months ending January 2006.

Our Rank among Wholesalers

Women’s Fashion Footwear Sales in U.S.

Department Stores*

Ranked by Parent Company

($ in millions)

After Acquisition

Brown Wholesale

Bennett Footwear Group

Bridge

Better

Moderate

Zone

Our Portfolio of Brands

No. 8

No. 9

No. 2

No. 11

No. 3

No. 1

Mass Private Label

* Reflects NPD Group Reported POS Dollar Volume. 12 Months ending January 2006.

No. 3

men;

No. 15

women

No. 11

junior

Wal-Mart

Payless

Federated

Footlocker

Famous Footwear

Nordstrom

Kohl's

Finish Line

JC Penny

Target

DSW

Dillard's

Sears

Shoe Carnival

Kmart

% Share of Dollars

* Source: Competitive Shares reported by NPD Consumer Panel Survey, 12 Months ending January 2006.

Our Rank Among Top Footwear Retailers

Share of Footwear Sales by Retailer*

Overview of our Retail Businesses:

No. 1- Family Branded

No. 4- Women's Specialty

No. 3- Internet Footwear

2005 Accomplishments

1) Gained traction at Famous Footwear:

§ Record 3Q/4Q; Traffic up; Same-store sales up 2.5% for year

2) Acquired Bennett: upscale brands; accretive by $0.17 per share

3) Achieved rebound in key areas of wholesale business: strengthened

operating margins

4) Restructured Naturalizer store base: closings completed, same-store

sales up 5.1% in Q4 for ongoing stores

5) Doubled e-commerce sales

2005 Financial Accomplishments

1) Sales growth of 18% to $2.3 billion (half from Bennett)

2) EPS $2.17 - up 29% on an adjusted basis* to $3.32

§ Famous Footwear operating earnings rise 11%

§ Wholesale operating earnings increased 78%

§ Bennett delivering as expected

3) Strengthened Balance Sheet and Cash Flow

§ Inventories down, well managed

§ Debt-to-cap of 31.5%

§ Net cash from operating activities of $146.8 million

4) Announced 3-for-2 stock split; Raised dividend 20%

(all EPS data herein is presented on a pre-split basis)

* This is a non-GAAP financial measure. See the Appendix for a Reconciliation of Net Earnings to Adjusted Net Earnings.

Key Strategies for Long-Term Growth:

1) Create differentiation - for our stores, our footwear, our brands

2) Create consumer preference with compelling footwear design & styles

3) Lead in Speed-to-Market - to increase sell-throughs and reduce

markdown risk.

4) Build our portfolio of brands

Balance Growth + Investment - delivering earnings performance while

investing for the future

2006 Guidance

Annual

§ Sales up 8% to $2.48 billion

§ EPS up 50% (8% on adjusted basis*)

§ Famous Footwear comps of 2 to 3%

§ Shifting of earnings between Q1/Q2

First Quarter

§ Sales up 8% to $560-$570 million

§ EPS double LY (down 30% on

adjusted basis*)

Second Quarter

§ Sales up 6% to $580-$590 million

§ EPS double LY (GAAP and adjusted)

2006 Growth drivers include:

§ Famous Footwear traction

§ Bennett acquisition

§ Wholesale "sell-through"

business model

§ Specialty Retail initiative

§ E-commerce growth

* This is a non-GAAP financial measure. See the Appendix for a Reconciliation of Net Earnings to Adjusted Net Earnings.

Long-Term Goal - Targeting high single-digit revenue growth

and 10-15% compound earnings growth rate.

Longer term growth drivers:

n Famous Footwear - creating differentiation with preference

to provide the basis for significant door count expansion

n Wholesale - achieving margin and market share

opportunities via strong, well-differentiated brands.

n Specialty Retail - building a multi-channel, cost-effective

specialty store and e-commerce platform for growing our

brands, while contributing gross margin dollars

n Platform Efficiency - continuing to reshape our platform to

increase our earnings potential

Financial Highlights

Appendix

-$0.50

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

2001 2002 2003 2004 2005 2006

Sales and EPS - 2001 to Estimated 2006

Charges and recoveries included in net earnings and EPS for 2003, 2004, 2005 and estimated 2006, are listed in the Reconciliation of

Net Earnings to Adjusted Net Earnings in the Appendix pages.

Sales in Billions Earnings Per Share

Implement

Project IMPACT

$2.48 Billion

$3.35 - $3.45

Estimated Estimated

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

2001 2002 2003 2004 2005 2006

* Includes $1.15

per share of

charges from

closing

unproductive

stores, acquiring

Bennett and

repatriating

foreign earnings.

Debt to Capital Ratio

(Millions of dollars, except for Debt to Capital Ratio)

* Total Debt Obligations include long term debt, borrowings under revolving credit agreement and capital lease

obligations. 2005 total debt obligations include additional debt related to the Bennett Footwear acquisition.

** Total Debt Obligations divided by Total Capital

Debt to Capital Ratio 2005 2004 2003 2002 2001

Total Debt Obligations* 200 $ 142 $ 120 $ 152 $ 216 $

Total Shareholders' Equity 434 391 350 292 253

Total Capital 634 $ 533 $ 470 $ 444 $ 469 $

Debt to Capital Ratio** 31.5% 26.6% 26.0% 34.0% 46.0%

Distinct Wholesale Portfolio

Projected for 2006

Famous Footwear -- Sales by category

Based on 12 months ended January 2006

15%

17%

21%

29%

15%

17%

21%

29%

Women’s Women’s

Men’s Men’s

Kid’s Kid’s

Athletic

Accessories

Athletic

Net

Earnings EPS

Net

Earnings EPS

Net

Earnings EPS

Net

Earnings EPS

GAAP Results 46.2 $ 2.48 $ 43.3 $ 2.30 $ 41.0 $ 2.17 $ 64.7-66.7 $ 3.35-3.45 $

Special Charges and Recoveries:

Naturalizer Restructuring - - - - 9.2 0.49

Tax Repatriation - - - - 12.0 0.63

Bass Transition Costs - - 3.5 0.18 - - - -

Bond Guarantee Charge - - 2.2 0.12 - - - -

Tax Reserve Recovery - - (1.0) (0.05) - - - -

Environmental Litigation 2.0 0.11 0.4 0.02 - - - -

Canada Factory Closure 2.7 0.14 - - - - - -

Adjusted Earnings 50.9 $ 2.73 $ 48.3 $ 2.57 $ 62.9 $ 3.32 $ 68.7-70.7 $ 3.55-3.65 $

2003 2004

Reconciliation of Net Earnings to Adjusted Net Earnings

2003 - 2006 Estimated

Non-GAAP Financial Measures

In this presentation, 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 net earnings per diluted share excluding certain 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 indicate underlying trends in the Company’s business and provide useful information to both management and investors by excluding certain items that are not indicative of the Company’s core operating results. These measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results.

2006 Estimated Range

Low - High

Bridge Loan Fee 0.6 0.03

2005

Stock Option Expense 0.20 4.0

Appendix: Schedule 1

Reconciliation of EPS Guidance (GAAP Basis) to EPS Guidance Adjusted to

Exclude Charges (Non-GAAP)

Non-GAAP Financial Measures

Estimated

1st Quarter 2006

1st Quarter

2005

Estimated

2nd Quarter 2006

2nd Quarter

2005

Diluted

EPS (low)

Diluted

EPS(high)

Diluted EPS Diluted

EPS (low)

Diluted

EPS (high)

Diluted EPS

GAAP Earnings $0.45 $0.50 $0.20 $0.55 $0.65 $0.22

Charges / Other Items:

Stock Option Expense 0.05 0.05 - 0.05 0.05 -

Naturalizer Store

Closing Charges

- - - - - 0.09

Tax Repatriation

Charge

- - 0.51 - - -

Bridge Loan Fee - - 0.03 - - -

Total Charges / Items 0.05 0.05 0.54 0.05 0.05 0.09

Adjusted Net Earnings $0.50 $0.55 $0.74 $0.60 $0.70 $0.31

Appendix: Schedule 2

Reconciliation of Operating Earnings to Adjusted Operating Earnings

(in millions) 2005 2004 2003 2002 2001

Operating Earnings 88.6 $ 63.8 $ 72.9 $ 71.7 $ 11.1 $

Special Charges and Recoveries

Naturalizer Restructuring 14.7 - - (0.5) 16.8

Famous Footwear Inventory Write-Down - - - - 16.0

Shared Services Platform Implementation - - - (0.7) 3.5

Famous Footwear New Management Transition - - - - 3.9

Impairment of Shoes.com Goodwill - - - - 1.2

Bass Transition Costs - 5.6 - - -

Bond Guarantee Charge - 3.5 - - -

Environmental Litigation - 0.6 3.1 - -

Canada Factory Closure - - 4.5 - -

Adjusted Operating Earnings 103.3 $ 73.5 $ 80.5 $ 70.5 $ 52.5 $

Non-GAAP Financial Measures

In this presentation, 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 operating earnings excluding certain 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 indicate underlying trends in the Company’s business and provide useful information to both management and investors by excluding certain items that are not indicative of the Company’s core operating results. These measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results.

Appendix: Schedule 3

EBITDA* 103.5 $ 95.7 $ 128.9 $

Special Charges

Naturalizer Restructuring - - 14.7

Bass Transition Costs - 5.6 -

Bond Guarantee Charge - 3.5 -

Environmental Litigation 3.1 0.6 -

Canada Factory Closure 4.5 - -

Adjusted EBITDA 111.1 $ 105.4 $ 143.6 $

Reconciliation of Net Earnings to EBITDA* and Adjusted EBITDA

2003 2004

Net Earnings 46.2 $ 43.3 $ 41.0 $

Interest Expense, net

Income Tax Provision

Depreciation and Amortization

9.3 7.5 17.5

17.3 13.0 30.1

30.7 31.9 40.3

* EBITDA represents earnings before interest, taxes, depreciation and amortization.

Non-GAAP Financial Measures

EBITDA and Adjusted EBITDA are not measures of financial perform ance under GAAP, but are used by some investors to determine a company's ability to service or incur indebtedness. EBITDA and Adjusted EBITDA are not calculated in the same manner by all companies and accordingly are not necessarily comparable to similarly entitled measures of other companies and may not be an appropriate measure for performance relative to other companies. EBITDA and Adjusted EBITDA should not be construed as indicators of a company's operating performance or liquidity, and should not be considered in isolation from or as a substitute for net earnings (loss) or cash flows from operations which are prepared in accordance with GAAP. We have presented EBITDA and Adjusted EBITDA solely as supplemental disclosure because we believe they allow for a more complete analysis of results of operations. EBITDA and Adjusted EBITDA are not intended to represent and should not be considered more meaningful than, or as an alternative to, measures of operating performance as determined in accordance with GAAP.

2005

Appendix: Schedule 4