DSW Names New CEO, Blames Slow Traffic for Weak Results
November 03 2015 - 5:00PM
Dow Jones News
DSW Inc. named a company insider as its next chief executive as
the footwear company warned slowing U.S. retail traffic and weak
sales within the women's category would dent its results.
Shares declined 12% after hours and have dropped 34% so far this
year through Tuesday's close.
DSW has sought to expand its business by opening new stores as
well as through deals. But those moves come as U.S. retailers are
facing a steep and persistent drop in store traffic as shoppers
make more of their purchases online.
The company said Roger Rawlins will succeed Michael MacDonald as
CEO at the start of next year as part of its succession planning
process. Mr. Rawlins, who will join the board, is currently the
company's chief innovation officer, and before joining DSW in 2006,
he worked at HER Real Living and L Brands Inc.
As for Mr. MacDonald, DSW highlighted that sales nearly doubled
and earnings increased fivefold during his six years at the helm.
He will also retire from the company's board.
The footwear and accessories retailer partly blamed unseasonably
warm temperatures for the weakness in its women's category and
called its results for the quarter ended Saturday weaker than
expected.
It guided for earnings of 41 cents to 44 cents a share on
revenue of about $665 million. Sales at existing locations declined
3.9%. Analysts polled by Thomson Reuters were looking for earnings
of 55 cents a share on revenue of $709 million.
Pointing to the challenging sales trends and an
inventory-related charge, DSW also cut is guidance for the year
ending in January, now calling for earnings of $1.40 to $1.50 a
share, down from its previous guidance for $1.80 to $1.90.
The board approved a $200 million share repurchase plan.
Write to Lauren Pollock at lauren.pollock@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
November 03, 2015 17:45 ET (22:45 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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