Designer Brands reported a net sales decrease of 7.3% to $3.1bn for the full year ended 3 February 2024 (FY23) and a gross profit decrease to $1bn versus $1.1bn in the same period the year before.

CEO Doug Howe explained 2023 was a “difficult year” as the company was “impacted by a softening footwear market, highly promotional retail environment, and the impact of unseasonably warm weather” on its seasonal footwear business.

Designer Brands FY23 results

  • Net sales decreased 7.3% to $3.1bn in FY23 from $3.3bn
  • Operating profit was $72.4m in FY23 compared to $187.3m in the same period in the prior year.
  • Reported net income attributable to Designer Brands Inc. was $29.1m compared to $162.7m the year before with a diluted earnings per share of $0.46.

The company’s fourth quarter (three months ended 3 February 2024) saw net sales decrease 0.8% to $754.3m and gross profit decrease to $207.4m million compared $222.0m in the same period the year before.

Designer Brands Q4 results

  • Net sales decreased 0.8% to $754.3m in Q4 from $760.5m
  • Operating profit was -$36.0m in Q4 compared to +$2.07m in the same period the year before.
  • Reported net loss attributable to Designer Brands Inc. was $29.7m, or loss per diluted share of $0.52.

Howe said: “We ended the year strong, with a solid finish to the fourth quarter above the top end of our revised EPS guidance range, led by strength in our brand portfolio segment as a result of acquiring Keds, Topo, and launching Le Tigre.”

Designer Brands acquired the Keds brand from Wolverine Worldwide in February 2023.

Designer Brands opened one store and closed one store in the US and closed one store in Canada in Q4, resulting in a total of 499 stores in the US and 143 stores in Canada as of 3 February 2024.

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Designer Brands’ 2024 financial outlook

Designer Brands hopes to return to growth across its business in FY24 with a 2024 guidance of low to single digits for Designer Brands’ net sales growth and a diluted earnings per share of $0.70 to $0.80.

Howe shared: “Looking ahead to 2024, we have an important transition year ahead as we plan to return to growth across our business. We are laser focused on assembling a fresher and more trend-right assortment for our customers, providing an increasingly convenient shopping experience across our channels and executing on operational improvements in our brands business bolstered by our new hires. We expect these initiatives will underpin improved financial performance throughout the year, and combined with disciplined cost savings, will lead to continued strong cash flow generation.”