Designer Brands Inc. reported that net sales plunged by 44.7 percent to $482.8 million in the first quarter of fiscal year 2020, compared to the same period the previous year. The company operates almost 1,000 retail stores under names like DSW Designer Shoe Warehouse and The Shoe Company.
Comparable sales fell 42.3 percent for the first quarter of 2020, in comparison to a 3 percent rise in the same quarter of fiscal 2019, according to an announcement. The company’s net loss for the first quarter was $215.9 million.
Designer Brands Chief Executive Officer Roger Rawlins said in the announcement, "As we said last quarter, the effect of COVID-19 on our industry has been unprecedented and has created many significant near-term challenges. The pandemic necessitated store closures and heavily impacted consumers, resulting in total comparable sales being down 42% during the first quarter."
Designer Brands said it has successfully opened roughly 90 percent of its overall store base, and it foresees having almost all of its North American locations open by the conclusion of June. The retailer said it has put into place many procedures to safeguard the wellness and safety of shoppers as well as staff members as retail locations open again.
The company said it amended its credit facility of $400 million and bolstered its borrowings by $203 million “as a precautionary measure to increase its cash position and preserve financial flexibility considering uncertainty in the U.S. and global markets resulting from COVID-19.”
It noted that an urgent need to raise capital does not currently exist but it “intends to evaluate assessing the financing markets and may look to raise capital, when and if the Company deems it prudent, to further strengthen its balance sheet.”
In separate news, retailer Express Inc. said that consolidated net sales plummeted by 53 percent to $210.3 million in the first quarter of 2020 from Q1 2019’s $451.3 million. The brand said it had opened 303 retail stores as of June 3 while following the newest state and federal guidelines. The firm also introduced a bolstered buy online, pick up in store (BOPIS) customer experience in some locations.