Footwear and accessories retailer Designer Brands saw net sales decline in the third quarter amid difficult macroeconomic conditions and unseasonably warm weather.
Net sales fell 9.1 per cent year over year to $786.3 million in the three months ended October 28 as sales dropped across all segments. The company’s brands include Vince Camuto, Jessica Simpson, Lucky, JLO and Jennifer Lopez.
US retail sales slid 10.6 per cent to $631.6 million while Canadian retail sales dropped 8.1 per cent to $75.6 million. Brand portfolio net sales declined 12.5 per cent to $94.1 million.
Attributable net income plunged 77.5 per cent to $10.1 million with gross margin falling to 32.6 per cent.
“This quarter, we were impacted by a footwear market that contracted for the first time since Covid coupled with unseasonably warm weather, which significantly reduced customer demand for shoes and pressured our heavily seasonal assortment,” said Doug Howe, CEO at Designer Brands.
“We saw improved performance in casual and clearance categories this quarter, but this was not enough to offset the broader lack of demand.”
During the quarter, the company opened one store in the US and six stores in Canada.
Meanwhile, for the full year, Designer Brands forecasts net sales to decline by the “high single digits” from last year.
“As we look ahead, we do not anticipate pressures alleviating in the near term, and we will continue to adjust accordingly. Our team is already executing several initiatives to address areas for improvement within our business,” said Howe.
“Ongoing refreshment of our assortment, including new specialty sizes, and new marketing initiatives are two ways we actively reinforce our business as the best in shoes.”
