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Shoe retailer earnings bested projections in most areas

DSW's Q4 results were mostly positive despite a big dip in net income.

March 21, 2016

While net income took a bit of a dive, retailer DSW enjoyed a decent revenue boost and doubled earnings per share that industry watchers expected in Q4.

The shoe and accessory retailer saw a 5 percent revenue jump, hitting $672 million, a much more robust increase than forecasted. Net income, however, dropped 60 percent, to $11.8 million, in the quarter. Comparable stores sales increased 0.7 percent.

"During the fourth quarter, we acted quickly to drive sales and gain market share, in the face of a challenging retail environment. While these actions negatively impacted operating margin in the near term, we believe they were the right steps to expand our customer base and exit the year with a clean inventory position," CEO Roger Rawlins stated in an announcement.

"In 2016, we will move decisively to improve our execution, intensify our focus on delivering value to our customers and drive additional growth by entering new categories, markets and digital channels. We recognize there is much more we need to accomplish and we are committed to returning DSW to sustainable and profitable growth while delivering strong shareholder returns," Rawlins said.

DSW noted several important milestones in 2015 in the earnings announcement:

• Opened 40 new stores in the U.S.

• Expanded presence in Canada with the opening of 11 locations by Town Shoes

• Grew digital demand by 22 percent in the full year, aided by the roll-out of Buy Online Pick-Up In Store and Buy Online Ship to Store

• Re-vamped its website with significant enhancements to search engine optimization and new personalization capabilities