DSW Q2 Results Top Estimates; Reiterates FY Adj. EPS Outlook

(RTTNews) - DSW Inc. (DSW), footwear and accessories retailer, announced financial results for the thirteen-week period ended July 30, 2016, reported that its net income for the second-quarter declined to $25.03 million, or $0.30 per share, from $37.61 million or $0.42 per share in the prior year quarter.

The latest-quarter result included pre-tax charges of $3.9 million, or $0.03 per share, from purchase accounting, transaction costs and fair market value accounting charges related to the acquisition of Ebuys, and $2.7 million, or $0.02 per share, from restructuring costs.

Adjusted net income was $29.1 million, or $0.35 per share, excluding costs related to the Ebuys acquisition and restructuring. Analysts polled by Thomson Reuters expected the company to report earnings of $0.30 per share for the quarter. Analysts' estimates typically exclude special items.

Sales for the quarter increased 5.1% to $659 million, including $19.6 million from Ebuys. Wall Street expected revenues of $658.68 million. Comparable sales decreased by 1.2% compared to last year's increase of 1.8%.

DSW Inc.'s Board declared a quarterly cash dividend payment of $0.20 per share. The dividend will be paid on September 30, 2016 to shareholders of record at the close of business on September 16, 2016.

The company completed a comprehensive expense review and identified approximately $25 million of annualized savings resulting from organization realignment and improvements in procurement and other business processes. Approximately 30% of these benefits, or $7 million, will be realized in 2016 and is included in the Company's full year guidance.

The company maintained its full year earnings guidance of $1.32 to $1.42 per share. Analysts expect annual earnings of $1.36 per share. Guidance excludes the impact of purchase price accounting, transaction costs and the fair market value accounting related to the acquisition of Ebuys and current and future charges related to its expense management review.