Footwear retailer DSW announced adjusted net income in the fourth quarter while simultaneously missing the mark for sales.
On Tuesday, the retailer reported an adjusted net income in the fourth quarter of $16.5 million, or $0.20 per diluted share, an increase of 43 percent compared to the same period last year.
Sales saw a conservative increase in the fourth quarter of 0.4% to $674.6 million, which includes $27.9 million of income from Ebuys, missing predictions. The retailer saw a comparable sales decrease of 7 percent in the fourth quarter, compared to a 0.7% increase the same time last year.
“Our fourth quarter continued our return to year over year profitability growth, with top line results that met our comp guidance,” said Roger Rawlins, DSW CEO.
Rawlins also attributed a product-driven campaign and inventory management to helping drive a higher gross margin. This added with better expense control gave the company a 22 percent increase in adjusted earnings per share this fall, according to Rawlins.
“After making fundamental changes to our core business last year, we are laser focused on driving comp growth through our merchandise and allocation initiatives and the elevation of our customer’s digital experience,” said Rawlins. “Furthermore, we are building a foundation to support the growth of Ebuys and Town Shoes and to leverage synergies across all of our retail brands.”
Meanwhile, fiscal year 2016 saw an adjusted net income of $120.1 million, or $1.46 per diluted share, a 5 percent decrease from the same period last year. However, sales increased in 2016 3.5% to $2.7 billion, including $83.9 million from the Company’s acquisition of Ebuys. Comparable sales decreased 3 percent.
DSW reports a fiscal year 2017 outlook of 3-5 percent in expected revenue growth, with comparable sales expected in a flat to low single digit decline compared to last year. Full year adjusted earnings per share is expected between $1.45 to $1.55 per diluted share.