Wed, Sep 11, 8:20 PM (101 days ago)
For the second quarter ended August 3, 2024, Designer Brands Inc. reported a 2.6% decline in net sales to $771.9 million, with comparable sales down 1.4%. Gross profit margin fell to 32.8%, down from 34.5% the previous year, primarily due to a shift towards lower-margin athletic and casual products and increased promotional pricing. Net income attributable to the company dropped 62.8% to $13.8 million, or $0.24 per diluted share, affected by restructuring and acquisition-related charges. The U.S. Retail segment saw a 1.1% decline in comparable sales, while Canada Retail reported a 3.1% decline, despite benefiting from the acquisition of Rubino, contributing $7.5 million in sales. The Brand Portfolio segment's sales rose due to a change in sourcing strategy to a wholesale model. Operationally, cash flow from operations decreased significantly to $21.9 million, attributed to increased inventory investments. The company maintains a strong liquidity position with available credit under its ABL Revolver, allowing it to support operations and growth despite economic uncertainties.