) reported third-quarter fiscal 2013 earnings of 58 cents a
share, which were in line with the Zacks Consensus Estimate but
rose 14% from 51 cents delivered in the year-ago quarter.
Management cited top-line growth and effective inventory
management to be the driving factors for the bottom line's
Including results of luxury test and other charges, DSW posted
earnings of 60 cents a share, up from 55 cents in the prior-year
The Quarterly Numbers
Total sales climbed 6.8% year on year to $633 million, thanks
to improved traffic in the later part of the quarter. However,
sales fell short of the Zacks Consensus Estimate of $649 million.
By segments, the DSW segment witnessed growth of 6.8% to $597.3
million and Affiliated Business Group also increased 6.8% to
Comparable-store sales fell marginally by 0.7% versus an
increase of 6.3% in the prior-year quarter. By segments, comps
fell 1% at DSW, but jumped 3.6% at Affiliated Business Group
during the quarter.
Gross profit rose 6.3% to $212.9 million, whereas gross profit
margin contracted 20 basis points to 33.6%. Operating profit
increased 12.5% to $88.3 million, while operating margin expanded
70 basis points to 13.9%.
This branded footwear and accessories retailer opened 16 new
outlets, including 2 small format stores during the quarter. As
of Nov 26, 2013, DSW operated 393 outlets in 42 states, the
District of Columbia and Puerto Rico.
Other Financial Aspects
DSW ended the quarter with cash and equivalents of $84.4
million, short-term investments of $195.2 million, and
shareholders' equity of $981.2 million.
The company declared a quarterly dividend of 12.5 cents a
share, payable on Dec 31, 2013 to stakeholders of record as of
Dec 19. Capital expenditures in the quarter were $22.4 million.
The company did not repurchase any share in the quarter.
Management projects adjusted earnings between $1.80 and $1.90
per share for fiscal 2013, and expects comparable-store sales to
remain flat. DSW also forecasts adjusted sales growth of 4% to 5%
for fiscal 2013.
DSW currently holds a Zacks Rank #2 (Buy). Other better ranked
stocks worth considering in the retail sector include
), carrying a Zacks Rank #1 (Strong Buy), and
Deckers Outdoor Corp.
), both carrying a Zacks Rank #2 (Buy).
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DSW INC CL-A (DSW): Free Stock Analysis
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