DSW Inc. doubled its earnings per diluted share in the quarter ended Oct. 31 on the strength of strong comp store sales gains.


The company reported net income of $26.6 million on net sales of $444.6 million for the quarter ended Oct. 31, 2009, compared with net income of $13.2 million on net sales of $391.4 million for the quarter ended Nov. 1, 2008. Same store sales increased 8.7% versus a decrease of 4.1% last year.

Diluted earnings per share were 60 cents for the third quarter of fiscal 2009 compared with diluted earnings per share of 30 cents for the same period last year.


Nine Month Results


Net income was $41.3 million on net sales of $1.2 billion for the thirty-nine weeks ended Oct. 31, 2009, compared with net income of $34.4 million on net sales of $1.1 billion for the thirty-nine weeks ended Nov. 1, 2008. Same store sales increased 0.4% for the comparable thirty-nine week period versus a decrease of 5.5% last year.


Diluted earnings per share were 93 cents for the period compared with 78 cents for the same period last year.


Fiscal 2009 Outlook


Based on the performance through the third quarter reported today, the company now estimates annual 2009 diluted earnings per share of 90 cents to $1.00 and annual comparable store sales of approximately 1%. This is updated from the company's previous estimate of annual 2009 diluted earnings per share of 70 to 80 cents, and flat annual comparable store sales.


DSW INC.
               CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                (In thousands, except per share amounts)
                               (Unaudited)



                       Three months ended           Nine months ended

                       ——————           —————–

                    October 31,   November 1,   October 31,  November 1,

                        2009          2008          2009         2008

                   ———–   ———–   ———–   ———–


Net sales              $444,621      $391,355    $1,199,957    $1,114,794

Cost of sales          (297,462)     (282,280)     (850,029)     (807,578)

————-          ——–      ——–      ——–      ——–

Gross profit            147,159       109,075       349,928       307,216

Operating

 expenses              (102,438)      (88,158)     (281,743)     (252,614)

———              ——–       ——-      ——–      ——–

Operating profit         44,721        20,917        68,185        54,602

Interest income,

 net                        445           686         1,277         1,829

Non-operating

 expense, net              (754)                       (621)

————-              —-                        —-

Earnings before

 income taxes            44,412        21,603        68,841        56,431

Income tax

 provision              (17,781)       (8,425)      (27,498)      (22,008)

———-              ——-        ——       ——-       ——-

Net income              $26,631       $13,178       $41,343       $34,423

———-              ——-       ——-       ——-       ——-


Basic and diluted

 earnings per share:

    Basic                 $0.60         $0.30         $0.94         $0.78

    Diluted               $0.60         $0.30         $0.93         $0.78