Designer Brands post drop in Q2 sales, reiterates outlook

Designer Brands has reported a 7.8 percent drop in net sales in the second quarter of the year.

The US footwear and accessories retailer generated sales of 792.2 million dollars in the three months to July 29, down from 859.3 million dollars a year earlier. On a comparable basis, sales were down 8.9 percent.

The company’s net profit narrowed to 37.2 million dollars from 46.2 million dollars the prior year.

Chief executive officer Doug Howe said in a statement: “I am proud of the sequential improvement in both sales and profitability in the second quarter as well as the progress that has been made on our strategic initiatives, with several exciting milestones in the quarter - including new collaborations and celebrity partnerships.

“Our portfolio of Owned Brands and National Brand partners remains strong and we are excited to be rolling out our new athletic and athleisure offerings from Le Tigre and Keds while continuing to elevate our relationship with Nike during a time that athletic and athleisure demand continues to grow.”

The company reiterated its full-year outlook. It expects net sales, excluding from the Keds brand, to be down mid- to high-single digits year-on-year.

Designer Brands acquired Keds from Wolverine Worldwide at the beginning of the year.

The company said it expects full-year diluted earnings per share (EPS), excluding the Keds brand, to be between 1.20 dollars and 1.50 dollars.

Howe said: “As we look ahead, we do anticipate near-term headwinds will persist, but we are confident in our plans to continue optimizing and spotlighting our unparalleled assortment.”