General Financial Releases

BROWN SHOE LOWERS 2nd QUARTER AND FULL-YEAR EARNINGS GUIDANCE

ST. LOUIS, MISSOURI, July 6, 2001-- Brown Shoe Company, Inc. (NYSE: BWS) today announced that ongoing difficulties in the footwear retailing sector have resulted in lower-than-anticipated sales at its 907-store Famous Footwear division. This trend, when combined with higher-than-planned markdowns during Famous Footwear's spring inventory clearance, is likely to result in earnings per share in the range of $0.37 to $0.40 for the second quarter, which ends August 4, compared to $0.51 in the year-ago quarter. Full year earnings will also be affected.

Continuing gains in the company's wholesale divisions, particularly Naturalizer, will not be enough to offset second quarter shortfalls at Famous Footwear. Naturalizer, Brown Shoe's flagship women's brand, continues to capture market share; its sales for the quarter are expected to be up 40 percent over year-ago levels, and unshipped orders continue to run well ahead of last year. In contrast, Famous Footwear, the company's largest division, now expects to report mid- to high-single-digit negative same-store sales comparisons for the fiscal month of June, which ends July 7.

"At Famous Footwear, we are aggressively executing a second-quarter inventory clearance program, timed so that by mid-July our inventories will be fresh for the back-to-school selling season," said Brown Shoe Chairman and CEO Ron Fromm. "While pairs sold for the month-to-date are up more than 5 percent on a store-for-store basis, the difficult retail climate forced us to take steeper price cuts than originally planned, leading to a greater trade-off in second-quarter profitability."

As announced last month, Famous Footwear also has been strengthening its merchandising and buying talent, adding a number of industry-respected executives. In addition, Brown Shoe is moving forward with enterprise-wide initiatives to improve its inventory management and logistics systems for both Famous Footwear and Naturalizer Retail. The company expects to be in a position to further discuss these initiatives and provide forward-looking guidance relating to the project during its second quarter conference call, scheduled for August 21.

"With the infusion of new merchandising/buying talent and better inventory management processes, our goal is to reduce exposure to future adverse market conditions, and capitalize on the inevitable improvement in the retailing environment," Fromm said.

Looking ahead to the back-to-school period, Fromm continued, "Although it is still early to project outcomes for Famous Footwear's back-to-school season, we believe that our inventory and merchandising position, coupled with a number of economic/consumer-buying factors, will support a better tone of business. Such factors include strengthening consumer confidence levels, and the retroactive tax relief expected in July, August, and September."

Historically, nearly 10 percent of all consumers shop in a Famous Footwear store during the back-to-school season.

As a result of this second quarter earnings guidance and the weakened retail climate, the company is lowering its annual earnings estimate to between $1.65 and $1.80 per share from the previous estimate of $2.25. In fiscal 2000, Brown Shoe earned $2.04 per share. Such forecasting, however, is particularly difficult at this time, given the completion of only five months of fiscal 2001, and the uncertain economic and retail climate. If the retail climate were to improve markedly, this forecast could prove conservative.

Second Quarter Earnings and Conference Call
Brown Shoe will issue its second quarter earnings after market close on August 21, 2001 and hold a conference call to discuss results at 4:30 p.m. EST. 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. Brown Shoe Company, Inc. reports to the Securities and Exchange Commission including its Annual Report on Form 10-K 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, Buster Brown, and licensed brands including Dr. Scholl's, Barbie, and other kids' character footwear. Brown Shoe press releases are available by fax through PR Newswire's Company News On-Call fax service at 800-758-5804, extension 109435. Brown Shoe information also is available on the Company's web site at http://www.brownshoe.com.