UPDATE: March 19, 2019: DSW has changed its corporate name to Designer Brands Inc. "which supports its vision for the future and reflects its expertise in building brands and delivering differentiated experiences," according to a company press release. The company also revealed a three-year strategic plan to build exclusive brands through Camuto Group's design and sourcing capabilities; expand services, including nail bars and repairs; enhance the VIP loyalty program; and launch a new loyalty program for The Shoe Company.
Dive Brief:
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In fiscal 2018, DSW crossed the $3 billion revenue threshold for the first time, with a 13.3% increase over the year prior, the company announced Tuesday morning when it reported full-year and and fourth quarter results.
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The company also recorded its best annual comparable sales since 2011, with a 6.1% rise, and its strongest adjusted EPS growth since 2013. "Digital demand" also grew over 30%, according to the release.
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Reported net loss, however, was $20.5 million, or 26 cents per diluted share, and adjusted net income was $134.9 million, which included a loss of 12 cents per diluted share from the wind-down of operations like Town Shoes and e-commerce site Ebuys. The company ended the fiscal year with $160 million in debt accumulated as a result of two recent acquisitions, including the Camuto Group.
Dive Insight:
DSW today looks much different than it did this time a year ago. While investors may be disappointed by a hit to profitability, the shoe retailer appears moving toward a long-term strategy for growth and relevance with today's shoppers.
That's so far meant shedding businesses weighing it down, buying up companies that expand its reach, relaunching its VIP loyalty program and doubling down on nail bars. DSW has also taken advantage of the strife in the children's category, left by the liquidation of Toys R Us last year, the spin off of bankrupt Gymboree's brands to The Children's Place and the Gap, and more recently the liquidation of Payless.
The shoe store chain on Tuesday also announced a three-year plan, which it plans to discuss later in the day, when it will also share its outlook for fiscal 2019.
CEO Roger Rawlins has previously said that the Camuto Group acquisition will give the company more control of its product assortment. Central to the growth of that unit is a ramp-up of the DSW private brand, Simon Nankervis, president of the Camuto Group, told investors Tuesday morning. He also noted that direct-to-consumer sales present a big opportunity.
