DSW parent company Q1 sales climb; tops Street
Designer Brands Inc. reported fiscal first-quarter profit and net sales ahead of expectations, with strong growth in its owned brands.
The parent company of DSW Designer Shoe Warehouse said it is on track to achieve its goal of doubling its owned brands sales by 2026. Designer Brands announced the goal at its investor day in April, at which it said it also set a target of revenue of $4 billion in revenue in fiscal 2026.
“Our strong first quarter 2022 results demonstrate the progress we are making towards our long-range plan that we outlined at our recent Investor Day,” stated CEO Roger Rawlins. “In addition, we are further building our relationships with our top national brands and our new prototype warehouse reimagined store, which opened in May, brings to bear a wealth of capabilities and opportunities that will help us to strengthen these relationships and provide a more seamless omnichannel experience for our customers. “
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Designer Brands’ net income rose to $26.2 million, or $.34 a share, for the quarter ended April 30, from $17.0 million, or $0.22 a share, in the year-ago period. Adjusted earnings were $0.48 cents, easily topping analysts’ estimates of $0.24 a share.
Net sales rose 18.1% to $830.5 million, above estimates of $815.4 million. Same-store sales were up 15.3%.
Cost of sales rose 13.9%, or less than sales, to push gross margin up to 33.2% from 30.7%.
“In an increasingly direct-to-consumer world, we continue to acquire opportunities to meet customers at a range of touchpoints,” Rawlins said. “Most recently, this includes our partnership with Wolverine and the Hush Puppies brand, our partnership with ABG and the Reebok brand, and our purchase of the 'shoes.com' digital domain.
For fiscal 2022, the company raised its earnings per share guidance range from $1.90 to $2.00 from $1.80 to $1.90. It cut its same-store sales growth outlook to the mid-single digits percentage range from high-single digits.
Designer Brands operates 510 stores across the U.S. and 140 stores in Canada under the DSW Designer Shoe Warehouse and The Shoe Company banners.
The company also designs and produces footwear and accessories through Camuto Group, a leading manufacturer selling in more than 5,400 stores worldwide.
Camuto Group owns licensing rights for the Jessica Simpson footwear business and footwear and handbag licenses for Lucky Brand. In partnership with a joint venture with Authentic Brands Group, the company also owns a stake in Vince Camuto, Louise et Cie and others.