DSW reports double-digit sales growth, raises yearly outlook
After facing financial uncertainty in recent years, DSW appears to be back on track. The footwear specialist raised its full year outlook on Tuesday after reporting a double digit revenue jump for its third quarter.
The Columbus, Ohio-based company said revenue increased by 17.2 percent to $833 million for the three months ended November 3, 2018 with comparable sales up 7.3 percent.
Net income was $39.3 million, or $0.48 per diluted share, while adjusted net income soared 56 percent to $57.9 million, or $0.70 per diluted share.
The footwear and accessories retailer benefited from a number of sources including “investments in merchandising, marketing and talent," said CEO Roger Rawlins.
“The nationwide roll-out of DSW kids drove the most successful back-to-school season in our history, and our recently acquired Canadian business delivered the best results in the last five years," added Rawlins.
The company has been consolidating its Canadian retail business and despite exiting the Town Shoes banner this year, which operates 38 locations in Canada, contributed an 11 percent sales growth to the business.
Last month, DSW acquired the operations of Camuto Group, alongside brand management firm Authentic Brands Group. The unorthodox merger is expected to further give the retailer the push it needs to return to profitability.
"Our acquisition of Camuto Group brings powerful design and sourcing capabilities in-house and new streams of revenue from one of the leading lifestyle brands in fashion footwear. Integration efforts are on track, with supply chain and working capital improvements paving the way for a return to profitability,” Rawlins added.
“We have transformed our company to one of North America's largest footwear operators, with vertical product development expertise combined with a vast distribution network. This will accelerate market share growth by creating value for more customers and increasing our competitive differentiation.”
Looking ahead, DSW raised its full year outlook. It now expects adjusted EPS in the range of $1.70 to $1.85 per diluted share, compared to its previous range of $1.60 to $1.75 per diluted share.
Meanwhile, revenue is expected to increase 12 to 14 percent, instead of 6 to 9 percent.
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