DSW Inc., (NYSE: DSW)
Shares of DSW rose more than 20% on Tuesday after the footwear and accessories retailer reported better-than-expected second quarter earnings and revenue. The company also raised both its earnings and revenue outlook for the full year. During the quarter, revenue increased 16% thanks to incredible same-store sales.
DSW also added that it is going to sell its Town Shoes unit (its smallest footwear brand) in order to concentrate on its three major retail segments; DSW Designer Shoe Warehouse, Shoe Company and Shoe Warehouse.
DSW Earnings & Outlook
DSW reported adjusted earnings per share of $0.63 beating Wall Street estimate of $0.46 per share. In the second quarter of the previous year, the company reported adjusted earnings of $0.38 per share. The firm has topped analyst earnings per
share estimates three times over the last four quarters.
Revenue increased to $795 million from $681 million in the year ago period. Revenue also surpassed analyst estimate of $691 million. The company has surpassed Wall Street revenue estimates two times over the last two years.
DSW also boosted its adjusted earnings for the full year to between $1.60 and $1.75 per share from the previous range of $1.52 to $1.67 per share. The consensus adjusted earnings estimate is $0.49 per share for the current quarter, and $1.61 per share for the full year.
DSW expects its full-year revenue to increase by between 6% to 9%, compared with its previous outlook of between 1% to 3%. Analysts estimate revenue of $704.82 million for the third quarter and $2.80 billion for the full year.
DSW CEO Comments
The Chief Executive Officer of DSW, Roger Rawlins issued the following remarks, “We are thrilled to report record sales and earnings results this quarter as our merchandise strategy and marketing investment fueled strong customer engagement, traffic and transaction activity, resulting in a 10% comp. The strong results we’ve had this spring demonstrate we’re successfully activating customers and increasing lifetime value. I’m proud of the progress we’re making and with our updated earnings outlook, we look forward to sales reaching $3 billion for the first time in DSW’s history.”
Rawlins continued, “After completing our strategic assessment of the Canadian marketplace, we have decided to close its smallest retail banner and focus on the three largest family footwear banners which we believe have the most potential for future growth and profitability.”
DSW Inc., Company Profile
DSW, Inc. is engaged in the distribution of footwear and accessory brands. It offers a range of casual and athletic footwear, dresses, as well as accessories for women, men, and kids. It operates through the DSW segment, which is responsible for the operation of DSW stores and dsw.com website that offers women’s footwear; men’s footwear; accessories, and kids’ footwear.
DSW was incorporated in 1969 and is headquartered in Columbus, Ohio. The company competes with Deckers Outdoor Corporation, L.L. Bean, Payless Shoesource Inc., Citi trends Inc. and J.C. Penney Company Inc. –Reuters
