DSW Inc. said it estimates comparable store sales of approximately positive 6% to 8% for the third quarter ending Oct. 31, 2009. The company experienced increased traffic and conversion since the end of the second quarter, resulting in positive comparable store sales.
As a result of better-than-expected sales performance, margin improvement and operational expense leverage for the ten week period ended Oct. 10, 2009, the company now estimates flat annual comparable store sales and annual diluted earnings per share of 70 cents to 80 cents for fiscal 2009. This is updated from the company's previous estimate of annual comparable store sales in the negative mid-single digits and annual diluted earnings per share of 37 cents to 45 cents for fiscal 2009.
Although its outlook for the third quarter has improved, the company remains cautious in its expectations for the fourth quarter as it expects the economic environment to remain challenging.
For DSW’s fiscal second quarter ended August 1, the company exceeded analysts’ predictions but posted earnings that fell 31% due to falling margins and higher costs. Same-store sales declines slowed in the quarter, while a net sales gain was somewhat inflated due to a year-to-date store increase of 32, including three that opened in the second quarter.
