DSW Beats Expectations Despite Profit Slip

If there’s a single retailer that is celebrating increases to both yearly and quarterly profits, they better bottle their luck and sell it on their shelves. However, merchants like DSW still have some bright spots in their annual reports.

The footwear and accessories retailer announced its Q4 2015 and yearly results on Tuesday (March 15), and CEO Roger Rawlins explained that the company’s profit margin edged down from its 2014 number of 27.6 percent to its new standing, 24.6 percent. However, heavy discounting and promotional activity boosted sales in Q4, leading to a 0.7 percent boost in same-store sales — a remarkable number considering Q3 saw that figure rest at a 3.9 percent decrease and that analysts had estimated a similar 3.5 percent slide for the period.

“During the fourth quarter, we acted quickly to drive sales and gain market share in the face of a challenging retail environment,” Rawlins said in a statement. “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. 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 and DSW also outlined the retailer’s hopes and dreams for the year to come. It pegged 2016 revenue growth between 8 and 10 percent, with same-store sales running anywhere from 1 to 2 percent. By Jan. 29, 2017, DSW said that it hopes to have closed two stores but opened an additional 34. Also of note is DSW’s recent acquisition of off-price eCommerce site Ebuys, which is expected to drive about $100 million in sales over the course of the year.