Sales of dress shoes and boots were challenged at Designer Brands Inc. in the second quarter. But the retailer’s Jessica Simpson brand still managed to see strong results.
“We are seeing a lot of traction with Jessica Simpson at the moment,” said DBI chief financial officer Jared Poff in Wednesday call with analysts. “And ironically, that’s a dress-focused brand, but she very much has a vibe and a kind of aesthetic that right now is really resonating. So, we’re doing quite well with that brand.”
In the second quarter, the Jessica Simpson brand saw high double-digit sales increases. Wholesale distribution was up 70 percent in the quarter. According to DBI chief executive officer Doug Howe, the brand “sustained the momentum” it saw in the first quarter and “continues to appeal to customers for its colorful and unique stock.”
The standout performance was at odds with a generally challenged dress category for DBI in Q2. Overall, the DSW parent company said its penetration in dress and seasonal footwear has declined from close to 60 percent in 2017 to about 49 percent today. As such, the company said it expects boots sales to be down in the double digits compared to the prior year as seasonal and dress penetration continues to shrink. Meanwhile, penetration in athletic and athleisure has grown from 32 percent in 2017 to 42 percent today, buoyed by a revived pipeline of products from Nike.
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In the company’s portfolio of owned brands, strong sales Jessica Simpson and Topo Athletic are expected to balance out declines from the broader DTC business, making for flat sales overall in the segment.
Jessica Simpson women’s footwear line is licensed through the DBI-owned Camuto Group as part of a long-term partnership. In 2021, Simpson and her mother Tina Simpson officially re-acquired full ownership of The Jessica Simpson Lifestyle Brand after Sequential, which bought the majority share from Camuto Group in 2015, filed for Chapter 11 bankruptcy protection. Camuto Group still licenses the brand.
DBI downgraded its 2024 outlook after it delivered fiscal second quarter earnings and sales results that fell short of expectations on Wednesday. Net sales for the DSW parent company decreased 2.6 percent to $771.9 million in the second quarter and comparable sales decreased 1.4 percent in the period. Adjusted net income was $17.1 million, with adjusted diluted EPS of 29 cents.
