Earnings Releases

BROWN SHOE REPORTS YEAR-END EARNINGS PER SHARE OF $2.04, FOURTH QUARTER EARNINGS PER SHARE UP 32 PERCENT -- .29 VERSUS .22

ST. LOUIS, MISSOURI, February 28, 2001 -- Brown Shoe Company, Inc. (NYSE: BWS) today reported net earnings for its fiscal year, ended February 3, 2001, rose to $36,365,000 or $2.04 per diluted share, compared to $35,501,000 or $1.96 per diluted share in 1999.

Consolidated net sales for the 53 weeks of fiscal 2000 increased 5.7 percent to $1,684,859,000 versus $1,594,131,000 for the 52 weeks of fiscal 1999.

Net earnings for the 14-week fourth quarter were up 28.1 percent to $5,004,000 versus $3,905,000 in the 13-week period last year. Diluted earnings per share increased 31.8 percent to $0.29 from $0.22 for the year-ago period. Consolidated net sales for the quarter were $407,643,000 compared with $356,877,000 in 1999.

"We finished the year with an outstanding fourth quarter," said Ron Fromm, chairman and chief executive officer, "and full-year results reflect real progress in our retail and wholesale businesses. Our Famous Footwear division passed the $1 billion sales mark for the first time in its history, and posted record operating earnings for the third consecutive year. Our Naturalizer flagship brand again recorded significant gains with department stores, and begins 2001 with a very strong on-order position that supports the continued momentum of this brand. Additionally, our wholesale women's private label group made a substantial earnings contribution, reflecting strong product development, relevant merchandising and excellent execution."

Operating earnings for Famous Footwear grew to $58.0 million, a 7.4 percent increase over 1999. Famous Footwear sales increased 11.4 percent to $1,033.7 million in 2000. Store productivity improved as sales-per-square-foot rose 0.6 percent over 1999, on top of last year's 4.2 percent increase. Same-store sales for the 52-week period ending January 27, 2001 were down 0.6 percent.

"During fiscal 2000, the Famous Footwear team took on significant challenges with the assimilation of the Mil-Mar chain and the introduction of our concept into larger, more prominent power strip center locations," said Fromm.

Famous Footwear opened 118 stores and closed 60 stores. The net 58 openings included the 26-store Milwaukee-based Mil-Mar chain.
"Famous Footwear will step up its performance in 2001," Fromm said. "We are proceeding with our program of opening larger, more productive 8,000 to 10,000 square foot stores in highly desirable power strip centers, which represent destination retailing for the American family."

Wholesale sales were $447.6 million versus $470.8 million in the year-ago period. Operating earnings were $31.0 million versus $32.8 million in 1999. These declines were primarily a result of the discontinued, unprofitable NaturalSport brand, and timing associated with the Star Wars license for children's shoes, which caused a large jump in the 1999 children's business. Brown Shoe announced last week that it had reached preliminary agreement with Lucas Films to design and market children's shoes associated with the next Star Wars film, due out in spring 2002.

The Naturalizer brand continued to gain additional wholesale distribution, despite the general retail malaise, as sales to major department stores increased 25 percent versus last year. "We will continue to invest in the new image and marketing of our flagship Naturalizer brand, and are targeting significant gains in market share over the next three years," Fromm said.

The Brown Wholesale division continued to build upon its strategic business partnerships with major mass merchandisers in the United States. Strong performance in product development, sourcing and execution produced sales gains in the women's private label business. Mr. Fromm added, "We also are pleased to report that our LifeStride business, which had been soft, has turned the corner and is starting to grow again -- and is doing so at good margins."

Naturalizer Retail stores, located throughout the U.S. and Canada, posted sales of $203.5 million in 2000, versus $186.6 million last year. Same-store sales for the 52 weeks ending January 27, 2001 for Naturalizer Retail's U.S. stores increased 0.5 percent and were up 5.9 percent in Canada. The operating loss widened slightly to $3.8 million in 2000 from $3.7 million in 1999, and was attributable to same-store sales declines and store closing costs in the U.S. during the second half of 2000.

"Overall, Naturalizer Retail's financial performance for 2000 was unacceptable," said Fromm. "We have stepped up our efforts to strengthen the product and merchandising strategies in our own stores, identify more productive store locations and close lesser-performing stores." The division closed 31 stores in January and February, 2001. There were 481 Naturalizer stores in operation at fiscal year-end, including 331 in the U.S. and 150 in Canada.

In fiscal 2000, the Company's total debt increased $56.5 million as a result of cash usage for the Mil-Mar acquisition, the planned investment in additional inventories related to larger stores at Famous Footwear, and the repurchase of 783,000 shares of Company stock at a cost of $8.7 million. In addition, capital expenditures were $30.5 million in 2000, up from $28.7 million in 1999, primarily related to the opening of 167 new stores and store remodelings.

"We are optimistic about 2001 as we look to build on this year's gains," Fromm said. "I am extremely pleased with our improved product offering at both retail and wholesale. Initiatives focused on product design and sourcing will continue to be the drivers of our future success as we deliver the right product at the right price to the right channel of distribution.

"Our real estate repositioning and store productivity programs aim to achieve same-store sales growth in the low single digits for the full fiscal year 2001," Fromm continued, "although the calendar shift from a 53-week year will cause comparisons to vary in any particular month.

"Our unshipped wholesale order position is strong for first and second quarter, and marketing expenditures have been planned to continue to build on the momentum of our Naturalizer and Famous Footwear branded businesses.

"In addition, Brown Shoe is planning major initiatives to streamline overhead and improve margins. The first, already underway, focuses on new logistics and inventory management systems that, not only reduce expenses, but also will enhance productivity."

The company remains comfortable with the First Call estimate for earnings per share of $2.25 for fiscal year 2001.


Fourth Quarter Earnings and Conference Call
A conference call to discuss fourth quarter results will be held at 4:30 p.m. EST this afternoon. While the question-and-answer session of the call will be limited to institutional analysts and investors, retail brokers and individual investors are invited to attend via a live web-cast to be hosted at http://www.streetevents.com. At the website, click on the Individual Investor Center to locate the broadcast. To listen to the webcast, your computer must have RealPlayer installed. If you do not have RealPlayer, go to http://www.streetevents.com prior to the call, where you can download RealPlayer for free.

Safe Harbor Statement Under the Private Securities Litigation Act of 1995: This press release contains certain forward-looking statements that are subject to various risks and uncertainties that could cause actual results to differ materially. These include general economic conditions, competition, consumer apparel and footwear buying trends, and political and economic conditions in Brazil and China, which are significant footwear sourcing countries. The Company's reports to the Securities and Exchange Commission contain detailed information relating to such factors.

Brown Shoe is a $1.7 billion footwear company with worldwide operations. The company operates the Famous Footwear and Naturalizer chains of footwear retail stores and markets leading brands including Naturalizer, LifeStride, NightLife, Buster Brown, and licensed brands including Dr. Scholl's, Carlos by Carlos Santana, Barbie, Digimon and RugRats character footwear. Brown Shoe press releases are available by fax through PR Newswire's Company News On-Call at 800-758-5804, extension 109435. Brown Shoe information also is available on the Company's web site at http://www.brownshoe.com.

(Thousands, except per share)	14 Weeks Ended	13 Weeks Ended	53 Weeks Ended	52 Weeks Ended
	February 3,	January 29,	February 3,	January 29,
	2001	2000	2001	2000
Net Sales	$ 407,643	$ 356,877	$ 1,684,859	$ 1,594,131
Cost of Goods Sold	239,933	221,829	1,002,727	967,161
Gross Profit	167,710	135,048	682,132	626,970
Selling and Administrative Expenses	155,403	128,975	610,788	558,436
Interest Expense	5,497	4,038	18,823	17,349
Other (Income) Expense	839	279	164	(580)
Earnings Before Income Taxes	5,971	1,756	52,357	51,765
Income Tax (Provision) Benefit	(967)	2,149	(15,992)	(16,264)
Net Earnings	$ 5,004	$ 3,905	$ 36,365	$ 35,501
Basic Net Earnings per Common Share	$ .29	$ .22	$ 2.06	$ 1.99
Diluted Net Earnings per Common Share	.29	$ .22	2.04	$ 1.96
Basic Number of Shares	17,279	17,911	17,670	17,859
Diluted Number of Shares	17,504	18,071	17,846	18,125

(Thousands)			February 3,		January 29,
			2001		2000
ASSETS
Cash and Cash Investments			$ 50,491		$ 34,158
Receivables, Net			64,403		68,236
Inventories, Net			427,830		365,989
Other Current Assets			20,008		19,391
Total Current Assets			562,732		487,774
Property, Plant and Equipment – Net			90,605		84,600
Other Assets			86,732		77,964
			$ 740,069		$ 650,338
LIABILITIES AND SHAREHOLDERS' EQUITY
Notes Payable			$ 66,500		$ -
Trade Accounts Payable			127,887		113,820
Accrued Expenses			89,954		89,547
Income Taxes			1,850		4,402
Current Maturities of Long-Term Debt			10,000		10,000
Total Current Liabilities			296,191		217,769
Long-Term Debt and Capitalized Leases			152,037		162,034
Other Liabilities			21,869		20,590
Shareholders' Equity			269,972		249,945
			$ 740,069		$ 650,338