DSW Inc.(NYSE: DSW) stock rose 1% on December 12th, 2018 (as of 9:54 am GMT-5; Source: Google finance) after the company posted better than expected results for the third quarter of 2018. The Company raised its full year outlook for Adjusted earnings per share to be in the range of $1.70 to $1.85 per diluted share, compared to its previous range of $1.60 to $1.75 per diluted share. The Company noted the impact of the Camuto Group acquisition reflects the seasonality of the business and the timing of the integration process, which is expected to yield benefits starting in 2019. Cash and investments totaled $294 million compared to $330 million last year.
The Company ended the quarter with inventories of $624 million compared to $547 million last year. Excluding inventories from the Canadian acquisition, inventories per square foot increased by 10.4% and increased by 7.9% on a two-year basis, in line with the Company’s two-year comparable sales growth of 6.9%
DSW in the third quarter of FY 18 has reported the adjusted earnings per share of 70 cents, beating the analysts’ estimates for the adjusted earnings per share of 53 cents, as per analysts surveyed by Zacks Investment Research. The company had reported the adjusted revenue growth of 17.2 percent to $833 million in the third quarter of FY 18, including $80 million from the Canadian retail segment and beating the analysts’ estimates for revenue of $788.4 million. On an organic basis, excluding the acquisition and business exits, total sales increased 10%, driven by a 7% increase in comparable sales. The strong volume growth, coupled with gross profit rate expanding by 320 basis points, drove outstanding profitability this quarter.
Moreover, from a product standpoint, all categories posted positive comp growth for the second quarter in a row. The Footwear category exceeded the company’s expectations with an 8% comp increase, the sixth quarter in a row of positive comp. Women’s Footwear comped in the high single digits, Men’s in the low single digits, and Accessories in the low double digits. The company’s strategy for growing the business through key product distortions continued, as Kids’ and Boot categories drove over 79% of the volume increase versus last year. Customer demand for fresh fashion drove the exceptional Boot business this quarter, which was the highest in three years.
DSW has declared a quarterly cash dividend of $0.25 per share. The dividend will be paid on January 4, 2019 to shareholders of record at the close of business on December 21, 2018.