DSW 2013 Annual Report Download - page 27

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Table of Contents
The following table summarizes our comparable sales change by reportable segment and in total:
Fiscal year ended February
1, 2014
DSW segment 0.1%
Affiliated Business Group segment 1.8%
Total DSW Inc. 0.2%
Our increase in total net sales for the DSW segment was a result of an increase in comparable sales, luxury test sales and non-comparable sales growth,
partially offset by an additional week of sales in fiscal 2012. Our comparable sales calculation is based on sales for the 52 weeks ended February 1, 2014
against the 52 weeks ended February 2, 2013, and excludes luxury test sales. The increase in comparable sales was a result of an increase in conversion offset
by a decrease in customer traffic. DSW segment comparable sales decreased in our largest business, women's footwear by 3%, increased in both men's and
accessories by 10%, and remained flat in athletic. Our non-comparable sales growth is attributable to both stores opened in fiscal 2012 as well as our opening
of 30 new DSW stores in fiscal 2013.
The increase in total net sales for our Affiliated Business Group segment was primarily the result of comparable sales growth and the net addition of 12 new
shoe departments and 9 Loehmann's locations in fiscal 2013.
Gross Profit. Gross profit is defined as net sales less cost of sales. Gross profit decreased as a percentage of net sales to 31.2% in fiscal 2013 from 32.1% in
fiscal 2012. By reportable segment and in total, gross profit as a percentage of net sales was:
Fiscal years ended
February 1, 2014
February 2, 2013
DSW segment 31.9%
32.8%
Affiliated Business Group segment 20.6%
21.0%
Total DSW Inc. 31.2%
32.1%
DSW Inc. gross profit was negatively impacted by $16.5 million related to our luxury test, which was comprised of a sales benefit of $18.4 million offset by
cost of sales of $34.9 million, which includes inventory adjustments. For DSW Inc., the reconciliation of gross profit excluding our luxury test was:
Fiscal years ended
February 1, 2014
February 2, 2013
(in thousands)
(as a percentage of net
sales)
(in thousands)
(as a percentage of net
sales)
DSW Inc. gross profit $739,287
31.2 %
$724,720
32.1%
Less: impact of the luxury test (16,481)
(1.0)%
—
—%
DSW Inc. gross profit excluding luxury test $755,768
32.2 %
$724,720
32.1%
For the DSW segment, the reconciliation of components of gross profit to merchandise margin excluding our luxury test as a percentage of net sales was:
Fiscal years ended
February 1, 2014
February 2, 2013
DSW segment gross profit 31.9 %
32.8%
Less: impact of the luxury test (1.0)%
—%
DSW segment gross profit excluding luxury test 32.9 %
32.8%
Store occupancy expense 10.4 %
10.0%
Distribution and fulfillment expenses 2.0 %
2.0%
DSW segment merchandise margin excluding luxury test 45.3 %
44.8%
23
Source: DSW Inc., 10-K, March 27, 2014 Powered by Morningstar® Document Research℠
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