Designer Brands Inc (DBI) 2023 Q3 法說會逐字稿

Welcome to the Designer Brands Third Quarter 2023 earnings conference call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions please note, this event is being recorded.

歡迎參加 Designer Brands 2023 年第三季財報電話會議。所有參與者將處於僅聽模式。今天的演講結束後，將有機會提問，請注意，活動正在錄製中。

I'd now like to turn the conference over to Ashley for Olin with Ellman Smithfield. Please go ahead.

我現在想將會議轉交給阿什利，由奧林和埃爾曼·史密斯菲爾德主持。請繼續。

Good morning. Earlier today, the company issued a press release comparing results of operations for the 13-week period ending October 28, 2023 for the 13-week period ended October 29, 2022. Please note that the financial results that we will reference during the remainder of today's call exclude certain adjustments recorded under GAAP, unless specified otherwise for a complete reconciliation of GAAP to adjusted earnings, please reference our press release. Additionally, please note that remarks made about the future expectations, plans and prospects of the Company constitute forward-looking statements. Results may differ materially due to various factors listed in today's press release and the Company's public filings with the SEC. The Company assumes no obligation to update any forward-looking statements.

早安.今天早些時候，該公司發布了一份新聞稿，比較了截至2023 年10 月28 日的13 週期間和截至2022 年10 月29 日的13 週期間的營運結果。請注意，我們將在剩餘時間內參考的財務業績今天的電話會議不包括根據 GAAP 記錄的某些調整，除非另有說明，有關 GAAP 與調整後收益的完整調節，請參閱我們的新聞稿。此外，請注意，有關公司未來預期、計劃和前景的言論構成前瞻性陳述。由於今天的新聞稿和公司向 SEC 公開提交的文件中列出的各種因素，結果可能會存在重大差異。本公司不承擔更新任何前瞻性陳述的義務。

Joining us today are Doug Hao, Chief Executive Officer, Jerry Pellizzon, Chief Financial Officer, and Laura de (unk), President of DSW. I'll now turn the call over to Doug.

今天加入我們的還有 DSW 執行長 Doughao、財務長 Jerry Pellizzon 和總裁 Laura de（英國）。我現在會把電話轉給道格。

Good morning, everyone.

大家，早安。

Thank you for joining us today. the third quarter was difficult for our business. Macro headwinds continue to impact us most acutely within our retail segment traffic as consumers remain under pressure and the overall footwear market contracted for the first time since the pandemic because our business is heavily weighted towards dress and seasonal, unseasonably warm weather also had an outsized impact on our top line. We also faced headwinds that we believe demonstrate our need to operate with even greater speed while increasing the level of innovation, newness and fashion in our assortments. To this end, we have made several strategic decisions regarding leadership across our organization, and we will be diligent as we embark on the journey of backfilling these roles in order to best position our business for the future.

感謝您今天加入我們。第三季對我們的業務來說很困難。宏觀逆風繼續對我們的零售業務產生最嚴重的影響，因為消費者仍然面臨壓力，整個鞋類市場自大流行以來首次萎縮，因為我們的業務主要集中在服裝上，季節性、反常的溫暖天氣也產生了巨大的影響在我們的頂線上。我們也面臨一些逆風，我們認為這表明我們需要以更快的速度運營，同時提高我們品種的創新、新穎和時尚水平。為此，我們就整個組織的領導力做出了幾項策略決策，我們將在踏上填補這些職位的旅程時勤奮工作，以便為我們的未來業務做好最佳定位。

During our second quarter earnings call, we communicated that our full year guidance assumed we set at a key inflection point and a retail comp performance would need to meaningfully improve, supported by a strong September throughout the balance of the year. In order to meet our expectations, we also noted the possibility for headwinds to worsen further something that could hamper the sequential improvement we require during the third quarter, we experienced a sales shortfall within the fall season, specifically September, particularly related to broad-based weakness in seasonal and dress. Conversely, the casual portion of our retail business continued to perform well, delivering comp sales growth in the mid-single digits. We also see the retail customer continuing to lean into value and the intentional rebuild of our clearance business within our US retail segment helped to slightly offset broader declines. Clearance sales were down only 3%, significantly better than our total sales, which were down 9%. However, none of these were significant enough to offset the precipitous decreases we experienced in dress and more notably in boots within our retail segment, which includes DSW stores, Shoe Company and their related e-commerce site. Our top line fell short of our expectations, driven by seasonal product demand. Specifically boot demand falling meaningfully year over year. This was a dynamic felt industry-wide. We have long been a market leader in seasonal footwear, which is boots and sandals, and this continued to represent a material portion of our sales in Q3. According to circ on a third quarter, seasonal footwear was down 16% based on dollar sales over the last year in the total market, which was in line with our performance at DSW. However, while seasonal footwear represents about 20% of the total market in the third quarter, it represented nearly 40% of DSW's business, resulting in disproportionate pressure on our performance as we look across our entire assortment and continue to learn more about evolving consumer preferences in both category mix and shopping channels. We are adapting our own strategic approach. We know we can perform better across all categories, including nonseasonal and get back to our roots of being a product lead, data-driven merchant organization, quick to supply a product that meets the trends the customer is leaning into to that end. I am excited by the skilled and experienced merchant leadership we have brought to the business and Laura Danek, our newest President of DSW, will speak to strategic initiatives. Her team is pursuing shortly, we met our expectations in our Brand Portfolio segment with overall sales down 12.5%, in line with our expectations. Declines in our legacy brands. Wholesale business were offset by the additions of Keds, towboat and Hush Puppies as well as strong performance at ABC.com. We are building momentum and gaining traction across our brand portfolio as we continue to prioritize long-term sustainable growth within this segment.

在第二季財報電話會議上，我們表示，我們的全年指引假設我們處於關鍵拐點，並且零售業績需要在全年強勁的 9 月支撐下顯著改善。為了滿足我們的預期，我們還注意到逆風可能進一步惡化，這可能會阻礙我們在第三季度所需的連續改善，我們在秋季（特別是9 月份）經歷了銷售短缺，特別是與廣泛的基礎相關季節和穿著方面的弱點。相反，我們零售業務的休閒部分繼續表現良好，實現了中個位數的銷售額成長。我們也看到零售客戶繼續傾向於價值，並且我們在美國零售部門有意重建清關業務，有助於略微抵消更廣泛的下滑。清倉銷售額僅下降了 3%，明顯優於我們下降 9% 的總銷售額。然而，這些都不足以抵消我們在零售領域（包括 DSW 商店、鞋業公司及其相關電子商務網站）的服裝，尤其是靴子方面經歷的急劇下降。受季節性產品需求的推動，我們的營收未能達到我們的預期。具體而言，靴子需求較去年同期大幅下降。這是整個產業充滿活力的感覺。長期以來，我們一直是季節性鞋類（靴子和涼鞋）的市場領導者，這仍然占我們第三季銷售額的重要部分。根據 Circ 第三季的數據，以美元銷售額計算，整個市場的季節性鞋類銷售額比去年下降了 16%，這與我們在 DSW 的表現一致。然而，雖然季節性鞋類產品在第三季度約佔整個市場的20%，但它佔DSW 業務的近40%，這對我們的業績造成了不成比例的壓力，因為我們審視整個產品系列並繼續了解不斷變化的消費者偏好在品類組合和購物管道上。我們正在調整我們自己的戰略方法。我們知道，我們可以在所有類別（包括非季節性）中表現更好，並回到我們作為產品領先、數據驅動的商業組織的根源，快速提供滿足客戶為此傾向的趨勢的產品。我對我們為企業帶來的技術精湛且經驗豐富的商業領導力感到興奮，我們新任 DSW 總裁 Laura Danek 將就戰略舉措發表講話。她的團隊很快就追求，我們在品牌組合領域達到了我們的預期，整體銷售額下降了 12.5%，符合我們的預期。我們的傳統品牌的衰落。批發業務被 Keds、towboat 和 Hush Puppies 的增加以及 ABC.com 的強勁表​​現所抵消。隨著我們繼續優先考慮該細分市場的長期可持續成長，我們正在為我們的品牌組合打造動力並獲得吸引力。

At the beginning of our brand-building journey, the portfolio we controlled was highly focused on dress and seasonal with significant whitespace opportunities in the casual and athleisure space, which drove us to make key acquisitions. Since that time, we have made notable progress, growing our portfolio and doubling the sales of our own brands across DBI.'s business continues to be central to our growth story moving forward. At telco specifically, we saw a sequential increase in the quarter and a significant improvement in our DTC. site throughput. In October, we launched three new shoes, including a new waterproof trail runner and new low top hiker. We also refreshed the ST. five, which pairs a minimally Christian zero drop platform with topo signature fit for a natural comfortable run experience and or workout session at the gym.

在我們品牌建立之旅的開始，我們控制的投資組合高度關注服裝和季節性，在休閒和運動休閒領域有大量的空白機會，這促使我們進行了關鍵收購。從那時起，我們取得了顯著的進步，擴大了我們的產品組合，並將 DBI 中自有品牌的銷售額翻了一番。業務仍然是我們未來發展故事的核心。特別是在電信公司，我們看到本季連續成長，且 DTC 顯著改善。站點吞吐量。十月，我們推出了三款新鞋，包括新款防水越野跑鞋和新款低筒健行鞋。我們也刷新了ST。 5 款，將簡約的 Christian 零落差平台與 topo 標誌性貼合相結合，帶來自然舒適的跑步體驗和/或在健身房鍛鍊。

I want to take a moment to thank our partners at REI., a key retail partner for us as we continue to expand our partnership and increase brand awareness for Turbo. Vince Camuto, the brand posted its highest demand day of 2023 in the quarter, as well as the largest full-price non-promotional day in DC.com history, spurred by the incredibly successful first-ever influencer collaboration with Dress Up butter cup a lifestyle brand by DD. red, who has over $1 million followers on Instagram to celebrate the launch influencers attended a branch in Nashville, Tennessee, helping to drive significant publicity as we look to expand our specialty size business, which Laura will speak to in a moment. This recent launch has given us yet another proof point that Wildcat boots are in high demand and given the limited options available that address this market, we will continue to provide new offerings to capture share another way we are strategically evolving our assortment and listening to our customers year over year VC. dot com comp sales were up 7% for the quarter. Importantly, Vince Camuto remains in an excellent position to expand the total addressable market for our own brands with significant opportunity in both men's and women's wide with shoes.

我想花點時間感謝 REI. 的合作夥伴，REI. 是我們的重要零售合作夥伴，我們將繼續擴大我們的合作夥伴關係並提高 Turbo 的品牌知名度。 Vince Camuto 表示，該品牌在本季度創下了2023 年最高需求日，也是DC.com 歷史上最大的全價非促銷日，這得益於與Dress Up butter cup 的首次影響力合作，取得了令人難以置信的成功DD 的生活方式品牌。 red 在Instagram 上擁有超過100 萬美元的粉絲，以慶祝產品發布。有影響力的人出席了田納西州納什維爾的一家分店，在我們尋求擴大我們的專業規模業務之際，幫助推動了重大宣傳，勞拉稍後將談到這一點。最近的推出再次證明了Wildcat 靴子的需求量很大，並且考慮到可滿足這一市場需求的產品有限，我們將繼續提供新產品，以另一種方式佔領市場份額，我們正在戰略性地發展我們的產品系列，並傾聽我們的意見客戶逐年增加 VC。本季網路公司銷售額成長了 7%。重要的是，Vince Camuto 在擴大我們自有品牌的整體目標市場方面仍然處於有利地位，在男鞋和女鞋領域都擁有巨大的機會。

Before I hand it over to Laura, I want to thank our team for their dedicated execution in this very challenging environment we are digging in, we will adapt, and I'm confident in our ability to navigate this backdrop and make progress on our long-term vision. Designer Brands is unlike any other company in the footwear industry. And I believe this unique model will allow us to grow our competitive edge as we aim to ride our business for the future.

在我將其交給勞拉之前，我要感謝我們的團隊在這個非常具有挑戰性的環境中的專注執行，我們正在挖掘，我們將適應，我對我們有能力駕馭這一背景並在我們的長期發展中取得進展充滿信心長期願景。 Designer Brands 不同於鞋類產業的任何其他公司。我相信，這種獨特的模式將使我們能夠增強競爭優勢，因為我們的目標是推動我們的業務走向未來。

We continue to prioritize building out our leadership team with the right skill set to ensure our product focus aligns within our customers' preferences. As a first step, Laura has hit the ground running and has begun laying the groundwork for key strategic updates. To elaborate on some of these priorities for DSW, please join me in welcoming DSW's President, Laura Danek, Laura, thank you, Doug, and hello, everyone.

我們繼續優先建立具有適當技能的領導團隊，以確保我們的產品重點符合客戶的偏好。作為第一步，勞拉已經開始行動，並開始為關鍵策略更新奠定基礎。為了詳細說明 DSW 的一些優先事項，請和我一起歡迎 DSW 主席 Laura Danek，Laura，謝謝你，Doug，大家好。

It's an honor to speak with you all today. And my first 100 days, my priority has been to work closely with the management team and great associates at DBI. to learn ins and outs of the business. I've also talked of customers and national brand partners and visited many stores throughout the country. There is a universal passion for DSW, and it's been exciting to witness. The power of our brand has also been important to me to hear firsthand where the biggest issues and therefore, areas of opportunity are as I boil this down. I believe that while DSW is certainly feeling the brunt of a very pressured industry, there are elements of our business where we can employ more focus and discipline. According to STAR Kona, the total footwear market was down in the third quarter year over year. The first quarter has seen a decline since Q4 of 2020, but DSW's performance also lagged the overall market as they work to unpack why and what we need to prioritize. I'm intently focused on three key areas in the near term to drive improvement, one, reinvigorating our assortment to optimizing our market investments and three, enhancing our in-store and digital shopping experiences. First, our assortment at DSW and across all of designer brands. It starts and ends with product. We can't lose sight of how important an optimal and differentiated assortment is our assortment. The size of which was historically unparalleled is what made DSW, the dominant retailer it is today and maintaining an energizing and trend-right assortment is even more critical today. And the customer has substantially more options from brands that are moving more quickly than ever over the last few years, designer brands has contended with a number of unforeseen events, not the least of which included the COVID pandemic and subsequent recovery demand further complicated by global supply chain issues amidst these external challenges, we've also been focused on driving vertical integration internally with a number of these challenges now behind us and an evolved business model, I believe we can turn more of our focus to accelerating the alignment of our overall assortment more closely to what customers are demanding as it stands currently, we can do more to bring the hottest brand and the excitement that comes with them to DSW's assortments to reinforce a differentiated and relevant offerings.

今天很榮幸能與大家交談。在我上任的前 100 天，我的首要任務是與 DBI 的管理團隊和優秀同事密切合作。了解業務的來龍去脈。我還與客戶和國家品牌合作夥伴進行了交談，並參觀了全國各地的許多商店。人們對 DSW 抱持著普遍的熱情，見證這一點令人興奮。我們品牌的力量對我來說也很重要，讓我能夠親耳聽到最大的問題以及機會領域，正如我總結的那樣。我相信，雖然 DSW 肯定首當其沖地感受到了這個壓力很大的行業的衝擊，但我們業務的某些方面我們可以更加專注和自律。根據 STAR Kona 統計，第三季鞋類市場總量較去年同期下降。自 2020 年第四季以來，第一季出現了下滑，但 DSW 的表現也落後於整體市場，因為他們致力於揭示原因以及我們需要優先考慮的事項。短期內我將專注於三個關鍵領域來推動改進，一是重振我們的產品組合以優化我們的市場投資，三是增強我們的店內和數位購物體驗。首先，我們在 DSW 以及所有設計師品牌的產品分類。它以產品開始和結束。我們不能忽視最佳和差異化的品種對我們的品種有多重要。 DSW 的規模史無前例，如今已成為占主導地位的零售商，而如今，保持充滿活力且緊跟潮流的產品種類顯得尤為重要。在過去的幾年裡，客戶從比以往任何時候都更快發展的品牌中獲得了更多的選擇，設計師品牌已經應對了許多不可預見的事件，其中最重要的是包括新冠病毒大流行和隨後的復甦需求，這些事件因全球疫情而變得更加複雜。除了這些外部挑戰中的供應鏈問題之外，我們還一直致力於推動內部垂直整合，現在我們已經克服了許多這些挑戰，並且業務模式不斷發展，我相信我們可以將更多的注意力轉向加速我們整體的協調我們可以採取更多措施，將最熱門的品牌及其帶來的興奮帶入DSW 的產品組合中，以強化差異化和相關的產品。

My vision for DSW's assortment is trend-right shoes that align with consumer demand, we need to get back to our heritage with a relentless flow of newness, key designer fines and creating SoMo in order to ensure we can maintain our position as a fashion footwear retailer. I have given our buyers a direction to maintain greater liquidity, listen to our consumers and seize opportunistic buys more tactically, I plan to leverage DSW's unique data and insights from our database of nearly 30 million loyalty members to identify trends and dynamically adjust our offerings and our marketing to provide a selection that resonates with evolving consumer preferences. This product-led data-driven assortment strategy brings back the passion and creativity that good merchants thrive on, including building strong and growing relationships with our national brand partners. We remain a sought-after partner for top national brands. Given our highly attractive customer base with our unparalleled access to the female athlete and the growing demand for athletic and athleisure product, these brands continue to prioritize placement in our channels. For example, Nike product began coming back online in September and as of early November is fully rolled out in all DBI. channels. Nike has instantly become one of our top national brands, both in stores and through our e-commerce site, and we couldn't be happier with this relationship. We are also pleased to see other national brands returning to DSW. And this spring, we plan to bring Under Armour back into our collection of high quality offerings. We're also excited for our dominant and growing relationships with Birkin stock and Skechers. And while the assortment must be relevant, we need to remind the consumer why DSW should be their preferred footwear retailer because we remain a leader in the industry, but in recent years has started to see DSW brand awareness at Road. We are still leading the footwear industry with our award winning VIP. program, which boasts nearly 30 million members. We have not been as diligent about one driving awareness among potential new customers and to communicate our continuously refreshed and renewed assortment and convenient shopping experience to our existing loyalty members. As such, I gain conviction that we must start investing again in top of funnel marketing and broad communications to grow the awareness that we are the best in shoes. As a first step in October, we significantly increased investment and top of funnel marketing, inclusive of an inspiring video campaign to reach over 75% of DSW's female target audience. While top-of-funnel marketing takes time to translate into tangible transactions today, early reads are encouraging that more simply having the right assortment is only half the battle DSW needs to continue to more loudly, articulate the variety and quality of our assortment to emphasize our unique position of footwear and remind the customer why they should choose DSW for all of their footwear needs.

我對DSW 產品系列的願景是順應潮流的鞋子，符合消費者的需求，我們需要透過不斷的創新、關鍵設計師的精品和創造SoMo 來回歸我們的傳統，以確保我們能夠保持我們作為時尚鞋類的地位零售商。我為我們的買家提供了保持更大流動性、傾聽消費者意見並更有策略地抓住機會性購買的方向，我計劃利用DSW 的獨特數據和來自我們近3000 萬忠誠會員數據庫的見解來識別趨勢並動態調整我們的產品和服務我們的行銷旨在提供與不斷變化的消費者偏好產生共鳴的選擇。這種以產品為主導、數據驅動的分類策略帶回了優秀商家蓬勃發展的熱情和創造力，包括與我們的全國品牌合作夥伴建立牢固且不斷發展的關係。我們仍然是頂級民族品牌廣受歡迎的合作夥伴。鑑於我們極具吸引力的客戶群、無與倫比的接觸女性運動員的機會以及對運動和運動休閒產品不斷增長的需求，這些品牌繼續優先考慮在我們的管道中的投放。例如，Nike 產品於 9 月開始重新上線，並於 11 月初在所有 DBI 中全面推出。渠道。耐吉已立即成為我們頂級的全國品牌之一，無論是在商店還是透過我們的電子商務網站，我們對這種關係感到非常高興。我們也很高興看到其他民族品牌重返 DSW。今年春天，我們計劃將 Under Armour 重新納入我們的高品質產品系列中。我們也對我們與 Birkin stock 和 Skechers 的主導且不斷發展的關係感到興奮。雖然品種必須相關，但我們需要提醒消費者為什麼 DSW 應該成為他們首選的鞋類零售商，因為我們仍然是行業的領導者，但近年來 DSW 的品牌知名度開始在 Road 上顯現。我們憑藉屢獲殊榮的 VIP 仍然引領鞋業。該計劃擁有近 3000 萬會員。我們沒有那麼努力地提高潛在新客戶的認知度，也沒有努力向我們現有的忠誠會員傳達我們不斷更新的品種和便捷的購物體驗。因此，我堅信我們必須再次開始投資漏斗行銷和廣泛的溝通，以提高人們對我們是最好的鞋子的認識。作為 10 月的第一步，我們大幅增加了投資和漏斗頂部行銷，其中包括鼓舞人心的影片活動，以吸引超過 75% 的 DSW 女性目標受眾。雖然今天的漏斗頂部行銷需要時間才能轉化為有形交易，但早期的解讀令人鼓舞，更簡單地擁有正確的產品組合只是成功的一半，DSW 需要繼續更大聲地闡明我們的產品組合的多樣性和質量，以強調我們在鞋類領域的獨特地位，並提醒客戶為什麼應該選擇 DSW 來滿足他們所有的鞋類需求。

Finally, I also feel strongly that we must always be invest in our customer experience, including our store fleet. The customer has more choices than ever as to where and how to shop for footwear, and we must provide an experience as frictionless and easy to navigate. In addition to constantly evolving our digital and omni capabilities to improve conversion and engagement. We are looking across our store footprint and evaluating opportunities to selectively invest in refreshing this experience to stay modern, relevant and provide an experience that Internet pure plays cannot. We've taken a thoughtful customer first approach asking what is important to them and subsequently testing new approaches to certain aspects of the shopping experience. We are analyzing feedback from test stores in Houston, Columbus and Oregon and prioritizing those aspects, which will have the biggest impact. We are in the early stages on this, but the customer reaction has been encouraging, and we are excited to continue testing and learning. As we move forward. Our teams will continue to develop a holistic strategy that we'll lean into a fresh, exciting assortment, new marketing initiatives and refreshed in-store and digital experiences.

最後，我還強烈認為，我們必須始終投資於我們的客戶體驗，包括我們的商店團隊。顧客在哪裡以及如何購買鞋類方面擁有比以往更多的選擇，我們必須提供無摩擦且易於導航的體驗。除了不斷發展我們的數位和全方位能力以提高轉換率和參與度。我們正在審視我們的商店足跡，並評估選擇性地投資刷新這種體驗的機會，以保持現代性、相關性，並提供純網路遊戲無法提供的體驗。我們採取了深思熟慮的客戶至上的方法，詢問什麼對他們來說是重要的，然後測試購物體驗某些方面的新方法。我們正在分析休士頓、哥倫布和俄勒岡州測試商店的回饋，並優先考慮那些將產生最大影響的方面。我們仍處於早期階段，但客戶的反應令人鼓舞，我們很高興能夠繼續測試和學習。當我們前進時。我們的團隊將繼續制定整體策略，致力於推出新鮮、令人興奮的產品組合、新的行銷舉措以及煥然一新的店內和數位體驗。

Thank you again, Doug, for having me join the conversation today. And with this, I will turn the call over to Jared for an overview of our financial results.

道格，再次感謝您邀請我參加今天的對話。至此，我將把電話轉給賈里德，以了解我們的財務表現概況。

Jared Thank you, Laura, and good morning, everyone. I want to reiterate Doug's comments as this is a difficult time for our business and the broader footwear industry. As he mentioned, the improvements that we were anticipating on both top and bottom line did not materialize. And the net risk position that I had called out on our last earnings call came to fruition. This quarter. The top line weakness ultimately flowed through leading to operating deleverage against a largely fixed expense base and resulted in an adjusted EPS of $0.24. Our team is aware of the factors that led to this situation and is making progress on sustainable improvements across all elements of the business based on what we have seen through the fourth quarter to date. We do not expect these sales pressures to alleviate as we wrap up this year, especially given the ongoing uncertainty in the macro environment.

賈里德 謝謝你，蘿拉，大家早安。我想重申道格的評論，因為這對我們的業務和更廣泛的鞋業來說是一個困難時期。正如他所提到的，我們預期的營收和利潤的改善並未實現。我在上次財報電話會議上提出的淨風險部位已經實現。本季。營收疲軟最終導致營運去槓桿化，而支出基礎基本固定，調整後每股收益為 0.24 美元。我們的團隊意識到導致這種情況的因素，並根據我們第四季度迄今為止所看到的情況，正在業務所有要素的可持續改進方面取得進展。我們預計這些銷售壓力在今年結束時不會減輕，特別是考慮到宏觀環境持續存在的不確定性。

Let me provide a bit more detail on our Q3 financial results for the third quarter, sales decreased 9.1% from last year to $786.3 million. From a wholesale perspective, sales were down roughly 22.7% in line with expectations as we lapped strong wholesale sales unlocked by pent-up demand in that channel last year following supply chain disruptions, US retail comps specifically were down 9.8% in the quarter, while Canada posted comps down 7.7% in the quarter. One bright spot was our Vince Camuto.com business, one of our premier DTC channels with comps up 7% in the quarter on top of a 27% comp last year and up 26.3% for the month of October. This quarter's success was largely driven by the brand's decision to lean into strong consumer demand for wide and Extra Wide shafted boots. Consolidated gross margin was 32.6% in the third quarter compared to 33% last year, a decrease of 40 basis points, driven primarily by an increase in promotional pricing and the deleverage of our fixed store occupancy costs offset by lower freight and shipping costs. That being said, our gross margin continues to be fundamentally stronger than pre-pandemic with consolidated gross margin up 330 basis points compared to the third quarter of 2019. And we will continue to look for ways to bring further efficiencies to our operating model. Our adjusted SG&A ratio for the third quarter was 28.9% of sales compared to 25.5% in the third quarter of 2022, driven primarily by deleverage from the top line pressures against an increasingly fixed expense base, along with an increase in marketing expense.

讓我更詳細地介紹一下我們第三季的財務業績，第三季銷售額較去年下降 9.1%，至 7.863 億美元。從批發角度來看，銷售額下降了約22.7%，與預期相符，因為去年供應鏈中斷後，該通路的被壓抑需求釋放了強勁的批發銷售額，美國零售企業本季度具體下降了9.8%，而加拿大本季的綜合指數下降了 7.7%。其中一個亮點是我們的 Vince Camuto.com 業務，它是我們主要的 DTC 管道之一，本季的比較增長了 7%，而去年的比較為 27%，10 月份的比較增長了 26.3%。本季的成功很大程度上得益於該品牌決定迎合消費者對寬靴和超寬靴的強勁需求。第三季綜合毛利率為32.6%，與去年同期的33% 相比，下降了40 個基點，這主要是由於促銷價格的增加以及我們的固定商店佔用成本的去槓桿化（被運費和運輸成本的下降所抵消）所致。話雖如此，我們的毛利率仍然比大流行前強，綜合毛利率比 2019 年第三季度增長了 330 個基點。我們將繼續尋找方法來進一步提高我們的營運模式效率。我們第三季調整後的 SG&A 比率佔銷售額的 28.9%，而 2022 年第三季為 25.5%，這主要是由於支出基礎日益固定的頂線壓力帶來的去槓桿化以及行銷費用的增加。

As Laura mentioned, for the third quarter, adjusted operating profit was 4% of sales compared to 7.8% for the prior prior year quarter. In the third quarter, we had $8.8 million of net interest expense and our effective tax rate on our adjusted results was 34.6% compared to 25.9% last year. Finally, our third quarter adjusted net income was $14.8 million or $0.24 diluted EPS versus $46.1 million or $0.67 last year. We ended the third quarter with inventories of $601.5 million, down roughly 12% compared to $681.8 million last year and down sequentially from $606.8 million in the second quarter. On a retail inventory per square footage basis, we ended down 11.5% versus the third quarter of 2022. Wholesale inventory ended the third quarter, up 2% and adjusted for the acquisition of Turbo and kids, inventory would have been down roughly 20% when compared to last year. Headed into the fall, we were acutely aware of the net risk position we were facing. And as such, we were very strategic with our inventory investments. We continue to remain nimble in our approach to our assortment as we prioritize maintaining a healthy inventory position, we strategically deployed promotions for Black Friday and Cyber Monday, which helped to drive traffic in stores and online. While the current environment is operationally challenging. Our strong and steady cash flow generation and liquidity remain a bright spot. Year to date through Q3, we have generated approximately $203 million of net cash provided by operating activities compared to $38 million during the same period last year and the third quarter of fiscal 2023. We also returned $82.5 million to shareholders through dividends and share repurchases year to date, that is a total of $111.5 million. In addition to generating meaningful cash flow from operating activities we further bolstered our liquidity position by arranging for a term loan in the second quarter. This action has given us ample liquidity to manage through turbulent times like this, while also allowing us to return cash to shareholders in the form of dividends and opportunistic share repurchases, something that we believe showcases our conviction and DBI.'s long-term strategy. We ended the quarter in a solid liquidity position with $54.6 million of cash and our total liquidity, which includes cash and availability under our revolver of $267.9 million. As of the end of the quarter, we had $213.3 million available to draw on our revolving credit facility on October 31, 2023, we borrowed $25 million of the $85 million available under our new term loan with any remaining delayed draw loans to be taken by January 31 of 2024. We remain well inside of all covenants and have strong relationships with all of our credit providers. Total debt outstanding was $375.5 million as of the end of the quarter. We continue to await the receipt of our remaining 40 million of our CARES Act tax refund due to us from the IRS. As a reminder, the IRS has formally closed our standard audit for which this refund applies with no adjustments. And as such, we are now simply waiting on the refund request to work its way through the approved appropriate approval channels at the IRS and TREASURY DEPARTMENT for ultimate funding. Given the quarter's results, we are addressing our full year outlook. We are now planning for DBI. net sales to be down high single digits, with retail comps also down high single digits for the year, implying DBI. net sales to be flat to down low single digits for the fourth quarter when taking into account the 53rd week. While we don't anticipate, we will see the demand that we lost in September boot sales materialize in the fourth quarter, we will remain in a competitive posture to keep our inventory at an appropriate level in order to do so. Higher promotions will continue to be necessary. This all results in expected adjusted EPS for the full year in the range of $0.4 to $0.7. The change in this revised adjusted EPS expectation is a substantially larger percentage change than the change in top line expectations as a result of a highly fixed expense base, which is anticipated to come in as originally communicated, our weighted average diluted shares outstanding are anticipated to be approximately $57 million for the fourth quarter and approximately $64 million for the fiscal year. Given the share repurchase activity that has occurred thus far throughout the year. With this, we are immediately taking actions dog and Laura mentioned to address the top line issues that are unique to us and believe we have identified areas that will yield meaningful results in the future for DSW. We have also discussed these the changes we are making in our Brand Portfolio segment, including finding an experienced and seasoned leader to run this business and anticipate outsized growth from this part of our business as we look across our longer-term horizon. And as always, we will be looking for ways to bring further efficiencies to our operating model moving forward, including efficiencies in operating expenses and interest expense. This will take time and we anticipate that our current fixed expense structure will continue to result in operating deleverage in Q4. As Doug noted, we are laser focused on accelerating our ongoing strategies that are working and tactically addressing areas of the business that are not performing as desired. While our results were disappointing, our team is more energized than ever to build solutions towards a more resilient and dynamic enterprise model.

正如 Laura 所提到的，第三季調整後營業利潤佔銷售額的 4%，而去年同期為 7.8%。第三季度，我們的淨利息支出為 880 萬美元，調整後業績的有效稅率為 34.6%，而去年為 25.9%。最後，我們第三季調整後淨利為 1,480 萬美元，稀釋後每股收益為 0.24 美元，去年為 4,610 萬美元，稀釋後每股收益為 0.67 美元。第三季末，我們的庫存為 6.015 億美元，比去年的 6.818 億美元下降了約 12%，比第二季的 6.068 億美元連續下降。以每平方英尺零售庫存計算，我們最終比 2022 年第三季下降了 11.5%。第三季末批發庫存成長了 2%，並根據收購 Turbo 和 kids 進行了調整，當與去年相比。進入秋季，我們敏銳地意識到我們面臨的淨風險狀況。因此，我們對庫存投資非常具有戰略意義。我們繼續保持靈活的分類方式，優先考慮保持健康的庫存狀況，策略性地部署了黑色星期五和網路星期一的促銷活動，這有助於增加商店和網路上的流量。儘管當前的營運環境充滿挑戰。我們強勁而穩定的現金流產生和流動性仍然是一個亮點。今年迄今到第三季度，我們透過經營活動產生了約2.03 億美元的淨現金，而去年同期和2023 財年第三季的淨現金為3,800 萬美元。我們也透過股利和股票回購向股東返還了8250 萬美元。迄今為止，該資金總額為 1.115 億美元。除了從經營活動中產生有意義的現金流之外，我們還透過在第二季安排定期貸款進一步增強了我們的流動性狀況。這項行動為我們提供了充足的流動性來應對這樣的動盪時期，同時也使我們能夠以股息和機會性股票回購的形式向股東返還現金，我們相信這體現了我們的信念和DBI 的長期戰略。 。本季末，我們的流動性狀況良好，擁有 5,460 萬美元現金，總流動性包括現金和可用資金 2.679 億美元。截至本季末，我們有2.133 億美元可用於於2023 年10 月31 日利用我們的循環信貸安排，我們藉了新定期貸款下可用的8500 萬美元中的2500 萬美元，任何剩餘的延遲提款貸款將由2024 年 1 月 31 日。我們始終遵守所有契約，並與所有信貸提供者建立了牢固的關係。截至本季末，未償債務總額為 3.755 億美元。我們繼續等待收到美國國稅局 (IRS) 應付給我們的剩餘 4,000 萬美元退稅款。謹此提醒，美國國稅局 (IRS) 已正式結束我們的標準審計，此退款適用於且無需任何調整。因此，我們現在只是等待退款請求通過美國國稅局和財政部批准的適當審批管道以獲得最終資金。鑑於本季的業績，我們正在討論全年展望。我們現在正在計劃 DBI。淨銷售額將下降高個位數，零售公司今年也將下降高個位數，這意味著 DBI。考慮到第 53 週，第四季淨銷售額將持平至低個位數。雖然我們預計 9 月靴子銷售中損失的需求不會在第四季度實現，但我們將保持競爭態勢，將庫存保持在適當的水平，以便做到這一點。更高的促銷活動仍然是必要的。這一切導致全年調整後每股收益預計在 0.4 美元至 0.7 美元之間。由於費用基數高度固定，因此修訂後調整後每股收益預期的變化比收入預期的變化要大得多，預計費用基礎將按照最初傳達的那樣進行，我們的加權平均稀釋後流通股預計將第四季度約5,700 萬美元，本財年約6,400 萬美元。鑑於全年迄今發生的股票回購活動。由此，我們立即採取狗和勞拉提到的行動來解決我們特有的首要問題，並相信我們已經確定了將在未來為 DSW 帶來有意義成果的領域。我們還討論了我們在品牌組合部門所做的這些改變，包括尋找一位經驗豐富、經驗豐富的領導者來運營這項業務，並在我們放眼長遠的同時，預計這部分業務將實現大幅增長。與往常一樣，我們將尋找方法來進一步提高營運模式的效率，包括營運費用和利息費用的效率。這需要時間，我們預計我們目前的固定費用結構將繼續導致第四季度的營運去槓桿化。正如道格所指出的那樣，我們專注於加速我們正在進行的策略，這些策略正在發揮作用，並從戰術上解決業績未達到預期的業務領域。雖然我們的結果令人失望，但我們的團隊比以往任何時候都更有活力，致力於建立更具彈性和動態的企業模型解決方案。

With that, I would like to turn to the operator for Q&A.

說到這裡，我想向接線員詢問一下。

Operator, we will now begin the question and answer session. To ask a question. You may press star then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw from the question queue, please press star then two. First question is from Gabby Carbone of Deutsche Bank. Please go ahead.

接線員，我們現在開始問答環節。問一個問題。您可以按按鍵式電話上的星號，然後按一個。如果您使用免持電話，請在按鍵前拿起聽筒。若要退出問題佇列，請按星號然後按兩顆。第一個問題來自德意志銀行的 Gabby Carbone。請繼續。

I think so much for taking my question. So I just wanted to dig in on your brand awareness comments. You mentioned that's eroded a bit. Maybe if you dig a little further into the investments you're making to bring the customer back to the store, do you think your target customer has changed at all? And then maybe how should we be thinking about the impact from that top of funnel marketing you mentioned on kind of SG&A moving ahead?

我想了很多來回答我的問題。所以我只是想深入了解您的品牌知名度評論。你提到這有點被侵蝕了。也許如果您進一步深入了解為吸引顧客回到商店而進行的投資，您是否認為您的目標客戶發生了根本變化？然後，也許我們應該如何考慮您提到的漏斗頂部行銷對 SG&A 的影響？

Thank you.

謝謝。

Good morning, Gary, this is Doug.

早安，加里，我是道格。

Thanks for your question?

謝謝你的提問？

Yes.

是的。

As we talked about, we invested in top-of-funnel marketing, which was episodic video in the quarter. As you know, those take time to be able to measure the impact of that. We are encouraged by those initial results, and it's something that we'll continue to lean into on as we move into Q1 and beyond. I don't know that our customer has changed dramatically other than just the continued strength of the penetration of the casual and the athletic area, which we have been leaning into obviously on. But we wanted to do that just based on the fact that we did see a erosion in kind of our awareness. And so we wanted to continue to make sure that we were increasing our overall customer file as we move forward. We're still working through on next year with regard to balance of top of funnel marketing as well as performance marketing. And just knowing that there's a latency impact, obviously top of funnel investment.

正如我們所說，我們投資了漏斗頂部行銷，即本季的情境影片。如您所知，需要時間來衡量其影響。我們對這些初步結果感到鼓舞，在進入第一季及以後的過程中，我們將繼續依靠這一點。我不知道除了休閒和運動領域的持續滲透之外，我們的客戶發生了巨大的變化，而我們顯然一直在關注休閒和運動領域。但我們之所以這麼做只是基於這樣一個事實：我們確實看到了我們的意識被侵蝕。因此，我們希望繼續確保在前進的過程中增加我們的整體客戶檔案。明年我們仍在努力平衡漏斗頂部行銷和效果行銷。只要知道有延遲影響，顯然是通路投資的頂部。

Got it.

知道了。

And then just a follow up, I wanted to dig into casual athletic a bit more. I think you mentioned last quarter that Nike came in about a month earlier than you originally planned. Maybe just how does the flow of Nike product transpire? How has the customer response been? And then has your other athletic kind of inventory competition changed at all with taking on more Nike product?

接下來，我想進一步深入研究休閒運動。我想你上個季度提到耐吉比你原計劃提前了大約一個月。也許耐吉產品的流通是如何發生的？客戶的反應如何？那麼，您的其他運動類庫存競爭是否因採用更多耐吉產品而發生了變化？

Yes, great question. Thank you. Obviously, we're very pleased with the initial Nike results on pure content and the product did come in a little bit earlier than we originally anticipated, which was originally planned for Q4. And so it was about midway through the quarter where it started to flow in the initial reaction has been quite strong within the first few weeks. It's on we now become one of our top five brands handily, and it still represented just a little over 1% of sales for the quarter, obviously. So we're still ramping up. And, you know, in historical times that was between 7% and 8%. So very encouraged by initial results.

是的，很好的問題。謝謝。顯然，我們對耐吉在純內容方面的初步結果非常滿意，而且該產品確實比我們最初預期的要早一些，最初計劃在第四季度推出。因此，大約在本季中期，資金開始流動，最初的反應在最初幾週內相當強烈。正是如此，我們現在輕鬆地成為了我們的前五個品牌之一，而且顯然它仍然只佔本季銷售額的 1% 多一點。所以我們仍在加緊努力。而且，你知道，在歷史時期，這比例在 7% 到 8% 之間。初步結果非常令人鼓舞。

As we move through Q4, we continued to see really strong momentum in the overall athletic category, which again, is part of our strategy as we tried to de seasonalized our business moving forward.

當我們進入第四季度時，我們繼續看到整個運動類別的強勁勢頭，這再次成為我們策略的一部分，因為我們試圖向前推進業務去季節性化。

And then Gaby, one thing I would add, and I think we've talked about this as well. In addition to the Nike product itself that we're very excited to see resonate with the customer. We also feel that the loss of Nike's certainly impacted other brands and that people would find their way into DSW through Google searching or some other way of the Nike brand and ended up buying somewhere else. Hard to quantify the exact impact of that. But we definitely think that that was a drag on our overall digital demand after we lost Nike across other brands. So we've been seeing that also come back. It will take time and the algorithms have to pick it up and bring you back to the top, but we're excited for what that might mean as well.

然後蓋比，我要補充一件事，我想我們也討論過這個問題。除了耐吉產品本身之外，我們很高興看到與客戶產生共鳴。我們也認為，Nike 的損失肯定會影響其他品牌，人們會透過 Google 搜尋或 Nike 品牌的其他方式找到進入 DSW 的方式，並最終在其他地方購買。很難量化其確切影響。但我們肯定認為，在我們失去耐吉並超越其他品牌後，這拖累了我們的整體數位需求。所以我們已經看到這種情況又回來了。這需要時間，演算法必須拾取它並帶您回到頂部，但我們也對這可能意味著什麼感到興奮。

Great.

偉大的。

Thank you so much.

太感謝了。

Again, if you have a question, please press star then one next question comes from Jay Sole of UBS.

再次強調，如果您有問題，請按星號，然後下一個問題將由瑞銀 (UBS) 的傑伊·索爾 (Jay Sole) 提出。

Please go ahead.

請繼續。

Super, thank you so much. And you mentioned that you expect some of these macro pressures to persist for a while. You obviously don't have a crystal ball and I would expect that. But you what would you think the macro pressures might alleviate some of this glass into first half of next year?

超級好，非常感謝。您提到您預計其中一些宏觀壓力將持續一段時間。顯然你沒有水晶球，我也預料到了。但您認為宏觀壓力可能會在明年上半年緩解部分玻璃壓力嗎？

Or I mean, how do you think about it?

或者我的意思是，你怎麼看待這個問題？

P.j., this is Doug.

P.j.，這是道格。

Thanks for your question.

謝謝你的提問。

Yes, your point we don't have a crystal ball. I would say kind of what we're seeing in Q4, which we've incorporated in our guidance is consistent with what we saw in Q3. There definitely was an outsized impact. We saw, obviously, in seasonal. We think partially attributable to warmer weather as we move into spring and that pivots into sandals.

是的，你的觀點是我們沒有水晶球。我想說的是，我們在第四季度看到的情況與我們在第三季度看到的情況一致，我們已將其納入我們的指導中。確實產生了巨大的影響。顯然，我們看到的是季節性的。我們認為，部分原因是隨著春天的到來，天氣變暖，涼鞋也隨之流行。

Obviously, our assortment dramatically changes.

顯然，我們的產品種類發生了巨大變化。

And we also we're seeing, like I said, buoyancy with the athletic trend and we're being very opportunistic and chase into inventory there to take advantage of what the customers are looking for. Having said that, I would say on customers continue to be very choosy and very selective with regards to discretionary purchases. And I think our clearance trend kind of indicates the fact that customers are still looking for value. That's always been a core strength of specifically DSW. We'll continue to lean into that on, but we're conservatively planning it and we'll be in a position to react and reacting to it real time.

正如我所說，我們也看到了運動趨勢的蓬勃發展，我們非常機會主義並追逐那裡的庫存，以利用客戶正在尋找的東西。話雖如此，我想說的是，顧客在隨意購買時仍然非常挑剔。我認為我們的清倉趨勢顯示了客戶仍在尋找價值的事實。這一直是 DSW 的核心優勢。我們將繼續關注這一點，但我們正在保守地計劃它，我們將能夠即時做出反應。

Got it.

知道了。

And maybe, Doug, just to put a finer point on it, can you just talk a little bit about how the sales trended, say the week before the Thanksgiving weekend and then obviously through Cyber Monday, how sales trended and what you've seen sort of since then the week post that, I mean, did you see that spike? And then like last week as it had been noted normalization back to the sales growth rates that you saw for or you give us maybe a little bit color around that, that would be helpful.

道格，也許為了更詳細地闡述這一點，您能否稍微談談銷售趨勢，例如感恩節週末前一周，然後顯然是整個網絡星期一，銷售趨勢如何以及您所看到的情況從那時起，我的意思是，你看到那個高峰了嗎？然後就像上週一樣，人們注意到銷售成長率正常化，或者您給我們了一些關於這一點的信息，這將會有所幫助。

Sure.

當然。

Yes.

是的。

Thanks for your question. We were very promotional because we wanted to make sure that we didn't lose share specifically as we went into that Cyber Week. And so we were very aggressive on promotions.

謝謝你的提問。我們非常促銷，因為我們希望確保在進入網路週時我們不會失去份額。因此我們在促銷方面非常積極。

We did see a nice performance there.

我們確實在那裡看到了精彩的表演。

And so again, you know, kind of mission accomplished with regard to not losing share. Having said that, there definitely has been a little coming out of Cyber Monday and then even the continuation of those from promos through Tuesday. So there's four weekends between Thanksgiving and Christmas. There's always historically been a bit of a lull between on Black Friday and the holidays, and we're definitely seeing that on. But what we're seeing, obviously for the quarter is still and is obviously incorporated into our guidance, but I think customers are waiting to the very last minute. They're being very selective. As I said, we were pleased with what we saw coming out of Black Friday, but again, we were very promotional and leaning into that.

再說一次，你知道，在不失去市場份額方面完成了某種使命。話雖如此，網路星期一確實有一些成果，甚至促銷活動也延續到了星期二。所以感恩節和聖誕節之間有四個週末。從歷史上看，黑色星期五和假期之間總是會有一段平靜的時間，我們肯定會看到這種情況。但我們所看到的情況顯然是本季度的情況，並且顯然已納入我們的指導中，但我認為客戶正在等待最後一刻。他們非常有選擇性。正如我所說，我們對黑色星期五所看到的結果感到滿意，但同樣，我們非常促銷並傾向於這一點。

Okay.

好的。

And then if I can ask one more, if you just elaborate a little bit on the brand portfolio within the brand portfolio, which brands do you see the most strength, maybe which brands you know, is there room for improvement? If you could just touch on the brands within the portfolio, maybe would be helpful.

然後我再問一個問題，如果您稍微詳細說明一下品牌組合中的品牌組合，您認為哪些品牌最有實力，也許您知道哪些品牌，是否還有改進的空間？如果您只能觸及投資組合中的品牌，那麼可能會有所幫助。

Thank you.

謝謝。

Yes.

是的。

And as Joe said in his comments, I mean that brand portfolio largely on performed within our expectations. We were up against a pretty strong comp last year as it relates to just some timing opportunities. But we're very encouraged with what we're seeing. Certainly from the card business, we're very encouraged with what we're seeing from turbo on two acquisitions, obviously, that were part of our strategy to down distort towards the casual line athletic space. So we're very encouraged by that. Again, small businesses overall, but we're definitely encouraged by what we saw and the plans that we have going forward for those brands in particular.

正如喬在評論中所說，我的意思是品牌組合很大程度上符合我們的預期。去年我們遇到了相當強大的競爭，因為它只與一些時機機會有關。但我們對所看到的感到非常鼓舞。當然，從卡片業務來看，我們對 Turbo 的兩次收購所看到的情況感到非常鼓舞，顯然，這是我們減少對休閒系列運動領域扭曲的策略的一部分。所以我們對此感到非常鼓舞。再說一遍，總體來說是小型企業，但我們所看到的情況以及我們特別為這些品牌制定的計劃絕對令我們感到鼓舞。

And then on Eliquis Grab, we launched that at DSW as part of our opportunity obviously to expand encouraged by initial results there as well. So again, early days going through, obviously the integration, but we're optimistic about those.

然後，我們在 DSW 推出了 Eliquis Grab，這顯然是我們擴張機會的一部分，也受到那裡初步結果的鼓舞。再說一次，早期的經歷，顯然是整合，但我們對這些持樂觀態度。

Got it. Okay.

知道了。好的。

Thank you so much.

太感謝了。

This concludes our question and answer session. I would like to turn the conference back over to Doug for closing remarks.

我們的問答環節到此結束。我想將會議轉回道格，以結束言論。

In closing, I would be remiss not to mention the terrible tragedies that have unfolded in Israel and Palestine over the past several months. Our hearts and prayers are with those suffering and we recognize this is a very difficult and uncertain time for many of our associates, our partners and our customers.

最後，如果我不提及過去幾個月在以色列和巴勒斯坦發生的可怕悲劇，那就太失職了。我們的心和祈禱是與苦難的人在一起，我們認識到這是我們許多同伴，我們的伴侶和客戶的非常困難和不確定的時期。

I'm proud of how our team cares for supports and lift those around us.

我為我們的團隊如何關心支持並提升我們周圍的人感到自豪。

We recognize the values that unite us have powerful positive impacts because at designer brands, we all belong. Thank you.

我們認識到團結我們具有強大正面影響的價值觀，因為在設計師品牌，我們都屬於。謝謝。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。