DSW Inc. reported sales increased 10.9 percent to $558.6 million in the first quarter ended April 30, compared to last year's first quarter sales of $503.6 million. Comparable sales for the first quarter 2012 increased by 7.6 percent. This follows an increase of 10.8 percent in comparable sales in the first quarter of 2011.

Reported net income was $39.9 million, or 89 cents per diluted share, which included a $4.3 million after-tax net charge related to RVI. This compares to reported net loss in the first quarter of 2011 of $38.1 million, or $1.74 per diluted share on 21.9 million weighted average shares outstanding, which included a $77.7 million after-tax net charge related to the merger with RVI.

“Earnings were at record levels despite absorbing incremental costs related to the acceleration in our store expansion,” said stated Mike MacDonald, President and Chief Executive Officer, DSW Inc. “Our new stores continue to perform well and we are on track to open 35 to 40 new stores in 2012. We are confident that we will meet our objective of another year of profitable growth and as such as we are raising our full year guidance to $3.25 to 3.40, an increase of $0.05 over our prior guidance of $3.20 to 3.35.”

As of May 22, 2012, DSW operated 336 stores in 41 states and operated an e-commerce site, www.dsw.com , and a mobile website, m.dsw.com . DSW also supplied footwear to 341 leased locations in the United States.

Net income, adjusted for the impact of items related to RVI was $44.1 million, or 98 cents per diluted share on 45.2 million weighted average shares outstanding. This compares to adjusted net income for the same period last year of $39.6 million, or 87 cents per diluted share on 45.3 million weighted average shares outstanding.

Reported net loss and loss per share for the first quarter 2011 now reflect the impact of the merger with RVI as if the merger had taken place at the beginning of fiscal 2011. Adjusted net income and earnings per share for the first quarter 2011 now exclude any impact from the merger with RVI. The Company has provided a table that includes the recast historical quarterly results for the first quarter 2011 at the conclusion of this press release.
First Quarter Balance Sheet Highlights
Cash and investments totaled $448 million compared to $400 million at the end of the first quarter 2011.
Inventories were $373 million compared to $334 million at the end of the first quarter of 2011, an increase of 11.6 percent. Inventories cost per square foot for DSW stores increased by 5 percent at the end of the quarter.
Fiscal 2012 Annual Outlook
The company is raising its annual 2012 guidance to a range of $3.25 to $3.40 for fiscal 2012 compared to prior guidance of $3.20 to $3.35. Comparable sales are projected to increase in the range of 3 percent to 5 percent, compared to earlier guidance for an increase in the 2 percent to 4 percent range. The company's fiscal year 2012 retail calendar includes a fifty-third week compared to a fifty-two week year in fiscal year 2011. This guidance includes only the minimal ongoing operating expenses related to RVI; the impact of the mark-to-market adjustment on the warrants and one-time items will continue to be excluded from the Adjusted earnings for Fiscal 2012.

DSW INC.
Q1 SEGMENT RESULTS

Net sales by reportable segment:













Three Months Ended

April 28, 2012

April 30, 2011

% increase


(in millions)









DSW

$

521.2

$

462.4

12.7

%

Leased Business Division

37.4

41.2

(9.2)

%

Total DSW Inc.

$

558.6

$

503.6

10.9

%


Comparable sales change by reportable segment:







Three Months Ended

April 28, 2012

April 30, 2011




DSW

8.0

%

10.9

%

Leased Business Division

2.3

%

9.2

%

Total DSW Inc.

7.6

%

10.8

%