DSW Q2 sales jump 5 percent

DSW sales increased 5.1 percent to 659 million dollars, including 19.6 million dollars from Ebuys. Comparable sales decreased by 1.2 percent compared to last year's increase of 1.8 percent. Reported and adjusted gross profit decreased by 210 bps.

Commenting on the company’s financial performance, Roger Rawlins, Chief Executive Officer of DSW stated, "We are on track to deliver our outlook for the full year and we've made progress on a number of initiatives to drive sales and improve our financial trajectory. We are committed to getting back to sustained earnings growth while planting the seeds for long term success.”

Second quarter operating results

Reported operating expense rate increased by 100 bps, which includes charges from purchase accounting and transaction costs related to the Ebuys acquisition. Adjusted operating expense rate increased by 40 bps primarily due to higher marketing and technology investments.

Reported net income was 25 million dollars, or 0.30 dollar per diluted share, including pre-tax charges of 3.9 million dollars, or 0.03 dollar per share. Adjusted net income was 29.1 million dollars, or 0.35 dollar per diluted share, excluding costs related to the Ebuys acquisition and restructuring.

Six months operating results

For the first six months, sales increased 4.5 percent to 1.3 billion dollars, including 34.7 million dollars from Ebuys. Comparable sales decreased by 1.4 percent compared to last year's increase of 3.5 percent.

Reported net income was 55 million dollars, or 0.67 dollar per diluted share, including pre-tax charges of 8.4 million dollars, or 0.06 dollar per share. Adjusted net income was 61.9 million dollars, or 0.75 dollar per diluted share, excluding costs related to the Ebuys acquisition and the company's restructuring costs.

Declares quarterly dividend and outlook

DSW's Board of Directors declared a quarterly cash dividend payment of 0.20 dollar per share.

The company maintained its full year earnings guidance of 1.32 dollars to 1.42 dollars per share. Guidance excludes the impact of purchase price accounting, transaction costs and the fair market value accounting related to the acquisition of Ebuys and current and future charges related to its expense management review.

Picture:Facebook/DSW