DSW Inc. raised its guidance for the year after a strong Q3 capped better-than-expected YTD results. Management said that it was “pleased” with its women’s results for the third quarter, with comps driven by a strong performance in casual footwear, better dress, casual performance, and core basics. Contemporary and moderate dress under-performed for the period, but total dress stayed positive thanks to the better segment. The men’s business was flat for the quarter, with strength in men’s boots, young men’s casual, and sport. Athletic performance was said to be “very strong” for the period, with women’s street fashion called out as particularly strong.

Total sales were up 9.9% for the third quarter to $332.2 million from $302.2 million in the year-ago period. Gross margins were up 220 basis points to 29.7% of sales from 27.5% of sales in Q3 last year. Net income jumped 46.7% to $16.0 million, or 36 cents per diluted share, compared to $10.9 million, or 25 cents per diluted share., in the year-ago quarter. Comp store sales were up 2.6% for the quarter on top of a 3.5% increase in Q3 2005.

Based on the strength of the nine-month year-to-date results, DSW raised its guidance for the full fiscal year. Diluted EPS is now seen in the range of $1.35 to $1.38 per share, up from previous estimates of $1.24 to $1.27 per diluted share for the year in a comp increase in the 1% to 3% range.