Payless ShoeSource Inc., stymied by sluggish sales and heavy markdowns needed to clear summer shoes, warned that its second-quarter and full-year profit and revenue will be sharply below analysts' expectations.
North America's largest family footwear retailer, which operates 4,907 stores, said profit will come in at $1.45 to $1.50 a share.
Analysts polled by First Call/Thomson Financial were expecting $2.44.
The company's shares fell $7.63, or 12%, to $56.95 on the NYSE.
The company's earnings estimate is well below last year's second-quarter profit of $2.16 a share.
The Topeka, Kan.-based retailer now expects sales at stores to be down by the mid-single digits for its second quarter.
For the full year, Payless now projects an 8% to 10% decline in earnings from the year earlier's $5.37 a share--or $4.83 to $5.20. The analyst consensus estimate has been for $6.08.
Payless will announce second-quarter results Aug. 15.