Designer Brands is one of North America’s largest designers, producers and retailers of footwear and accessories. Our business segments include world-class design and sourcing operations, a robust wholesaling business, and more than 1,000 points of distribution.
COLUMBUS, Ohio, Aug 31, 2010 /PRNewswire via COMTEX/ -- DSW Inc. (NYSE: DSW), a leading branded footwear specialty retailer, announced net income of $23.5 million on net sales of $415.1 million for the second quarter ended July 31, 2010, compared with net income of $7.6 million on net sales of $369.5 million for the quarter ended August 1, 2009. Same store sales increased 12.0% for the comparable period versus a decrease of 2.9% last year.
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Diluted earnings per share were $0.52 for the second quarter of fiscal 2010 compared with diluted earnings per share of $0.17 last year.
Six-month Results
Net income was $53.6 million on net sales of $864.7 million for the twenty-six week year-to-date period ended July 31, 2010, compared with net income of $14.7 million on net sales of $755.3 million for the twenty-six week year-to-date period ended August 1, 2009. Same store sales increased 14.1% for the comparable twenty-six week period versus a decrease of 3.8% last year.
Diluted earnings per share were $1.20 for the twenty-six week period compared with $0.33 for the same period last year.
Fiscal 2010 Annual Outlook
The Company reiterated its estimate of an annual comparable store sales increase of approximately 7% to 9% and annual diluted earnings per share of approximately $1.80 to $1.95 for fiscal 2010. Fiscal 2009 annual diluted earnings per share were $1.23.
The second half performance implied in the guidance recognizes the more challenging last year comparisons for both sales growth and merchandise margins.
The Company will discuss its 2010 annual outlook on its webcasted conference call to be held today.
Webcast and Conference Call
To hear the Company's live earnings conference call, log on to http://www.dswinc.com/ today at 8:00 AM Eastern, or call 866-831-6234 and reference passcode 16875673. To hear a replay of the earnings call, which will be available approximately two hours after the conference call ends, dial 1-888-286-8010, followed by passcode 59172207. An audio replay of the conference call, as well as additional financial information, will also be available at http://www.dswinc.com/.
About DSW Inc.
DSW Inc. is a leading branded footwear specialty retailer that offers a wide selection of brand name and designer dress, casual and athletic footwear for women and men. As of August 31, 2010, DSW operated 309 stores in 39 states and operated an e-commerce site, www.dsw.com. DSW also supplied footwear to 353 leased locations in the United States. For store locations and additional information about DSW, visit http://www.dswinc.com/.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Any statements in this release that are not historical facts, including the statements made in our "Outlook," are forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on the Company's current expectations and involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These factors include, but are not limited to: our success in opening and operating new stores on a timely and profitable basis; continuation of supply agreements and the financial condition of our leased business partners; maintaining good relationships with our vendors; our ability to anticipate and respond to fashion trends; fluctuation of our comparable sales and quarterly financial performance; disruption of our distribution operations; failure to retain our key executives or attract qualified new personnel; our competitiveness with respect to style, price, brand availability and customer service; uncertain general economic conditions; risks inherent to international trade with countries that are major manufacturers of footwear; risks related to our cash and investments; the success of dsw.com; RVI's lease of an office facility; and liquidity risks at Retail Ventures and their impact on DSW. Additional factors that could cause our actual results to differ materially from our expectations are described in the Company's latest annual or quarterly report, as filed with the SEC. All forward-looking statements speak only as of the time when made. The Company undertakes no obligation to revise the forward-looking statements included in this press release to reflect any future events or circumstances.
DSW INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
January
July 31, 30,
2010 2010
---- ----
ASSETS
Cash and equivalents $72,986 $125,020
Short-term investments 198,964 164,265
Accounts receivable, net 10,297 5,529
Inventories 309,143 262,284
Prepaid expenses and other
current assets 21,658 20,762
Deferred income taxes 32,774 29,130
--------------------- ------ ------
Total current assets 645,822 606,990
-------------------- ------- -------
Property and equipment, net 201,578 206,424
Goodwill 25,899 25,899
Other assets 31,132 11,443
------------ ------ ------
Total assets $904,431 $850,756
------------ -------- --------
LIABILITIES AND SHAREHOLDERS'
EQUITY
Accounts payable $140,443 $120,559
Accrued expenses 83,757 104,160
---------------- ------ -------
Total current liabilities 224,200 224,719
------------------------- ------- -------
Non-current liabilities 96,308 101,156
Total shareholders' equity 583,923 524,881
-------------------------- ------- -------
Total liabilities and
shareholders' equity $904,431 $850,756
--------------------- -------- --------
DSW INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(Unaudited)
Three months ended Six months ended
------------------ ----------------
August
July 31, August July 31, 1,
2010 1, 2009 2010 2009
--------- ------- --------- -------
Net sales $415,120 $369,490 $864,657 $755,336
Cost of sales (289,402) (271,702) (591,574) (552,567)
------------- -------- -------- -------- --------
Gross profit 125,718 97,788 273,083 202,769
Operating
expenses (87,623) (86,427) (185,843) (179,305)
--------- ------- ------- -------- --------
Operating
profit 38,095 11,361 87,240 23,464
Interest
income, net 137 578 922 832
Non-operating income,
net 528 133
--------------------- --- ---
Earnings before
income taxes 38,232 12,467 88,162 24,429
Income tax
provision (14,778) (4,900) (34,524) (9,717)
---------- ------- ------ ------- ------
Net income $23,454 $7,567 $53,638 $14,712
---------- ------- ------ ------- -------
Basic and diluted
earnings per share:
Basic $0.53 $0.17 $1.22 $0.33
Diluted $0.52 $0.17 $1.20 $0.33
Shares used in per
share calculations:
Basic 43,988 44,074 43,948 44,046
Diluted 44,826 44,420 44,800 44,355
SOURCE DSW Inc.
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