10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended August 3, 2019

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 1-32545

DESIGNER BRANDS INC.

(Exact name of registrant as specified in its charter)

Ohio			31-0746639
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
810 DSW Drive,	Columbus,	Ohio	43219
(Address of principal executive offices)			(Zip Code)

Registrant's telephone number, including area code: (614) 237-7100

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Class A Common Shares, without par value	DBI	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☑ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant

was required to submit such files). ☑ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☑	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☑ No

Number of shares outstanding of each of the registrant's classes of common stock, as of August 23, 2019: 64,911,631 Class A Common Shares and 7,732,786 Class B Common Shares.

DESIGNER BRANDS INC.

TABLE OF CONTENTS

	Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Statements of Operations	1
Condensed Consolidated Statements of Comprehensive Income (Loss)	2
Condensed Consolidated Balance Sheets	3
Condensed Consolidated Statements of Shareholders' Equity	4
Condensed Consolidated Statements of Cash Flows	5
Notes to the Condensed Consolidated Financial Statements	6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3. Quantitative and Qualitative Disclosures About Market Risk	32
Item 4. Controls and Procedures	33
PART II. OTHER INFORMATION
Item 1. Legal Proceedings	33
Item 1A. Risk Factors	33
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3. Defaults Upon Senior Securities	34
Item 4. Mine Safety Disclosures	34
Item 5. Other Information	34
Item 6. Exhibits	35
Signature	36

All references to "we," "us," "our," "Designer Brands Inc.," or the "Company" in this Quarterly Report on Form 10-Q mean Designer Brands Inc. and its subsidiaries. References to "DSW" refer to the DSW Designer Shoe Warehouse banner unless otherwise stated.

We own many trademarks and service marks. This Quarterly Report on Form 10-Q may contain trademarks, trade dress, and tradenames of other companies. Use or display of other parties' trademarks, trade dress or tradenames is not intended to and does not imply a relationship with the trademark, trade dress or tradename owner.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

DESIGNER BRANDS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited and in thousands, except per share amounts)

	Three months ended						Six months ended
	August 3, 2019			August 4, 2018			August 3, 2019			August 4, 2018
Revenue:
Net sales	$	849,640		$	793,735		$	1,719,632		$	1,504,172
Commission, franchise and other revenue	10,558			1,533			19,081			3,198
Total revenue	860,198			795,268			1,738,713			1,507,370
Cost of sales	(594,779		)	(539,240		)	(1,208,735		)	(1,044,452		)
Operating expenses	(226,616		)	(195,319		)	(449,422		)	(363,739		)
Income from equity investment in ABG-Camuto	2,464			—			4,692			—
Impairment charges	—			(36,240		)	—			(36,240		)
Operating profit	41,267			24,469			85,248			62,939
Interest income (expense), net	(1,972		)	805			(3,773		)	1,469
Non-operating income (expenses), net	199			(47,349		)	(143		)	(49,486		)
Income (loss) before income taxes and loss from equity investment in TSL	39,494			(22,075		)	81,332			14,922
Income tax provision	(12,087		)	(16,281		)	(22,731		)	(27,671		)
Loss from equity investment in TSL	—			—			—			(1,310		)
Net income (loss)	$	27,407		$	(38,356	)	$	58,601		$	(14,059	)
Basic and diluted earnings (loss) per share:
Basic earnings (loss) per share	$	0.37		$	(0.48	)	$	0.78		$	(0.18	)
Diluted earnings (loss) per share	$	0.37		$	(0.48	)	$	0.77		$	(0.18	)
Weighted average shares used in per share calculations:
Basic shares	73,529			80,265			75,267			80,187
Diluted shares	74,316			80,265			76,281			80,187

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

1

DESIGNER BRANDS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited and in thousands)

	Three months ended					Six months ended
	August 3, 2019		August 4, 2018			August 3, 2019			August 4, 2018
Net income (loss)	$	27,407	$	(38,356	)	$	58,601		$	(14,059	)
Other comprehensive income (loss), net of income taxes:
Foreign currency translation gain (loss)	461		(1,365		)	(253		)	(6,050		)
Unrealized net gain (loss) on debt securities	196		27			438			(317		)
Reclassification adjustment for net losses (gains) realized in net income (loss)	23		12,260			(65		)	14,165
Total other comprehensive income, net of income taxes	680		10,922			120			7,798
Total comprehensive income (loss)	$	28,087	$	(27,434	)	$	58,721		$	(6,261	)

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

2

DESIGNER BRANDS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited and in thousands)

	August 3, 2019			February 2, 2019			August 4, 2018
ASSETS
Cash and cash equivalents	$	51,762		$	99,369		$	215,996
Investments	25,504			69,718			73,119
Accounts receivable, net	85,162			68,870			17,259
Inventories	706,168			645,317			596,956
Prepaid expenses and other current assets	55,561			71,945			73,763
Total current assets	924,157			955,219			977,093
Property and equipment, net	402,779			409,576			387,621
Operating lease assets	975,963			—			—
Goodwill	116,280			89,513			25,899
Intangible assets	21,112			46,129			20,285
Deferred tax assets	29,515			30,283			14,235
Equity investment in ABG-Camuto	55,033			58,125			—
Other assets	32,407			31,739			19,883
Total assets	$	2,557,246		$	1,620,584		$	1,445,016
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable	$	289,457		$	261,625		$	229,440
Accrued expenses	173,437			201,535			145,776
Current operating lease liabilities	185,969			—			—
Total current liabilities	648,863			463,160			375,216
Debt	235,000			160,000			—
Non-current operating lease liabilities	905,546			—			—
Other non-current liabilities	38,590			165,047			150,316
Total liabilities	1,827,999			788,207			525,532
Commitments and contingencies
Shareholders' equity:
Common shares paid-in capital, no par value	988,305			978,794			971,653
Treasury shares, at cost	(498,436		)	(373,436		)	(325,906		)
Retained earnings	266,957			254,718			301,006
Basis difference related to acquisition of commonly controlled entity	(24,993		)	(24,993		)	(24,993		)
Accumulated other comprehensive loss	(2,586		)	(2,706		)	(2,276		)
Total shareholders' equity	729,247			832,377			919,484
Total liabilities and shareholders' equity	$	2,557,246		$	1,620,584		$	1,445,016

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

3

DESIGNER BRANDS INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(unaudited and in thousands, except per share data)

	Number of shares				Amounts
	Class A common shares		Class B common shares	Treasury shares	Common shares paid in capital		Treasury shares			Retained earnings			Basis difference related to acquisition of commonly controlled entity			Accumulated other comprehensive loss			Total
Three months ended August 3, 2019
Balance, May 4, 2019	67,434		7,733	18,501	$	982,093	$	(448,436	)	$	257,453		$	(24,993	)	$	(3,266	)	$	762,851
Net income	—		—	—	—		—			27,407			—			—			27,407
Stock-based compensation activity	145		—	—	6,212		—			—			—			—			6,212
Repurchase of Class A common shares	(2,668	)	—	2,668	—		(50,000		)	—			—			—			(50,000		)
Dividends ($0.25 per share)	—		—	—	—		—			(17,903		)	—			—			(17,903		)
Other comprehensive income	—		—	—	—		—			—			—			680			680
Balance, August 3, 2019	64,911		7,733	21,169	$	988,305	$	(498,436	)	$	266,957		$	(24,993	)	$	(2,586	)	$	729,247
Three months ended August 4, 2018
Balance, May 5, 2018	72,470		7,733	13,091	$	965,623	$	(325,906	)	$	359,342		$	(24,993	)	$	(13,198	)	$	960,868
Net loss	—		—	—	—		—			(38,356		)	—			—			(38,356		)
Stock-based compensation activity	91		—	—	6,030		—			—			—			—			6,030
Dividends ($0.25 per share)	—		—	—	—		—			(19,980		)	—			—			(19,980		)
Other comprehensive income	—		—	—	—		—			—			—			10,922			10,922
Balance, August 4, 2018	72,561		7,733	13,091	$	971,653	$	(325,906	)	$	301,006		$	(24,993	)	$	(2,276	)	$	919,484
Six months ended August 3, 2019
Balance, February 2, 2019	70,672		7,733	15,091	$	978,794	$	(373,436	)	$	254,718		$	(24,993	)	$	(2,706	)	$	832,377
Cumulative effect of accounting change	—		—	—	—		—			(9,556		)	—			—			(9,556		)
Net income	—		—	—	—		—			58,601			—			—			58,601
Stock-based compensation activity	317		—	—	9,511		—			—			—			—			9,511
Repurchase of Class A common shares	(6,078	)	—	6,078	—		(125,000		)	—			—			—			(125,000		)
Dividends ($0.50 per share)	—		—	—	—		—			(36,806		)	—			—			(36,806		)
Other comprehensive income	—		—	—	—		—			—			—			120			120
Balance, August 3, 2019	64,911		7,733	21,169	$	988,305	$	(498,436	)	$	266,957		$	(24,993	)	$	(2,586	)	$	729,247
Six months ended August 4, 2018
Balance, February 3, 2018	72,294		7,733	13,091	$	961,245	$	(325,906	)	$	354,979		$	(24,993	)	$	(10,074	)	$	955,251
Net loss	—		—	—	—		—			(14,059		)	—			—			(14,059		)
Stock-based compensation activity	267		—	—	10,408		—			—			—			—			10,408
Dividends ($0.50 per share)	—		—	—	—		—			(39,914		)	—			—			(39,914		)
Other comprehensive income	—		—	—	—		—			—			—			7,798			7,798
Balance, August 4, 2018	72,561		7,733	13,091	$	971,653	$	(325,906	)	$	301,006		$	(24,993	)	$	(2,276	)	$	919,484

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

4

DESIGNER BRANDS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited and in thousands)

	Six months ended
	August 3, 2019			August 4, 2018
Cash flows from operating activities:
Net income (loss)	$	58,601		$	(14,059	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	42,485			38,429
Stock-based compensation expense	9,731			9,698
Deferred income taxes	1,043			13,526
Loss (income) from equity investments	(4,692		)	1,310
Loss on previously held equity investment in TSL and notes receivable from TSL	—			33,988
Impairment charges	—			36,240
Lease exit non-cash charges	—			3,910
Loss on foreign currency reclassified from accumulated other comprehensive loss	—			13,963
Other	538			8,106
Change in operating assets and liabilities, net of acquired amounts:
Accounts receivable	(14,800		)	3,767
Inventories	(61,748		)	(37,308		)
Prepaid expenses and other current assets	(2,972		)	(23,257		)
Accounts payable	30,683			26,219
Accrued expenses	(24,677		)	(7,960		)
Net cash provided by operating activities	34,192			106,572
Cash flows from investing activities:
Cash paid for property and equipment	(40,259		)	(32,103		)
Purchases of available-for-sale investments	(3,014		)	(16,735		)
Sales of available-for-sale investments	47,764			67,280
Additional borrowings by TSL	—			(15,989		)
Business acquisitions, net of cash acquired	—			(28,152		)
Net cash provided by (used in) investing activities	4,491			(25,699		)
Cash flows from financing activities:
Borrowing on revolving line of credit	320,700			—
Payments on revolving line of credit	(245,700		)	—
Cash paid for treasury shares	(125,000		)	—
Dividends paid	(36,806		)	(39,910		)
Other	(397		)	(1,199		)
Net cash used in financing activities	(87,203		)	(41,109		)
Effect of exchange rate changes on cash balances	(286		)	300
Net increase (decrease) in cash, cash equivalents, and restricted cash	(48,806		)	40,064
Cash, cash equivalents, and restricted cash, beginning of period	100,568			175,932
Cash and cash equivalents, end of period	$	51,762		$	215,996
Supplemental disclosures of cash flow information:
Cash paid for income taxes	$	21,796		$	28,135
Cash paid for interest on debt	$	4,052		$	—
Cash paid for operating lease liabilities	$	118,563		$	—
Non-cash investing and financing activities:
Property and equipment purchases not yet paid	$	8,648		$	8,390
Operating lease liabilities arising from lease asset additions (excluding ASU 2016-02 transition adjustments)	$	9,184		$	—
Adjustment to operating lease assets and lease liabilities for modifications	$	48,029		$	—

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

5

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1.    SIGNIFICANT ACCOUNTING POLICIES

Business Operations- Designer Brands Inc. is a leading North American footwear and accessories designer, producer and retailer.

On May 10, 2018, we acquired the remaining interest in Town Shoes Limited ("TSL") that we did not previously own. Beginning with our second quarter of fiscal 2018, TSL ceased being accounted for under the equity method of accounting and was accounted for as a consolidated wholly-owned subsidiary. As a result of this acquisition, we operate a Canadian business that is a retailer of branded footwear under The Shoe Company, Shoe Warehouse, and DSW Designer Shoe Warehouse banners, as well as related e-commerce sites. Subsequent to the acquisition, and as a result of our strategic review, we exited the Town Shoes banner in Canada during fiscal 2018.

On November 5, 2018, we completed the acquisition of Camuto LLC, doing business as Camuto Group ("Camuto Group"), a footwear design and brand development organization, from Camuto Group LLC (the "Sellers"). The Camuto Group acquisition provides us a global production, sourcing and design infrastructure, including operations in Brazil and China, a new state-of-the-art distribution center in New Jersey, footwear licenses of brands, including Jessica Simpson and Lucky Brand, and branded e-commerce sites. Camuto Group earns revenue from the sale of wholesale products to retailers, commissions for serving retailers as the design and buying agent for products under private labels ("First Cost"), and the sale of branded products on direct-to-consumer e-commerce sites.

Also on November 5, 2018, in partnership with Authentic Brands Group LLC, a global brand management and marketing company, we formed ABG-Camuto, LLC ("ABG-Camuto"), a joint venture in which we have a 40% interest. This joint venture acquired several intellectual property rights from the Sellers, including Vince Camuto, Louise et Cie, Sole Society, CC Corso Como, Enzo Angiolini and others, and focuses on licensing and developing new category extensions to support the global growth of these brands. We have entered into a licensing agreement with ABG-Camuto whereby we pay royalties on our net sales from the brands owned by ABG-Camuto.

On March 4, 2016, we acquired Ebuys, Inc. ("Ebuys"), an off-price footwear and accessories retailer operating in digital marketplaces. Due to recurring operating losses incurred by Ebuys since its acquisition, as well as increased competitive pressures in the digital marketplace, we decided to exit the business and ended all operations in the first quarter of fiscal 2018.

On August 2, 2016, we signed an agreement with the Apparel Group as an exclusive franchise partner in the Gulf Coast region of the Middle East. During the fourth quarter of fiscal 2018, we provided our termination notice to the Apparel Group in accordance with the terms of the agreement and we are winding down the franchise operations during fiscal 2019.

We present three reportable segments: the U.S. Retail segment, the Canada Retail segment, and the Brand Portfolio segment. The U.S. Retail segment includes stores operated in the U.S. under the DSW Designer Shoe Warehouse banner and its related e-commerce site. The Canada Retail segment, which is the result of the TSL acquisition, includes stores operated in Canada under The Shoe Company, Shoe Warehouse, DSW Designer Shoe Warehouse banners and related e-commerce sites. The Brand Portfolio segment, which is the result of the Camuto Group acquisition, includes sales from wholesale, First Cost, and direct-to-consumer branded e-commerce sites. Our other operating segments are below the quantitative and qualitative thresholds for reportable segments and are aggregated into Other for segment reporting purposes.

Basis of Presentation- The accompanying unaudited, condensed consolidated financial statements have been prepared by management in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, we do not include all of the information and footnotes required by GAAP for complete financial statements. The accompanying financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of the results for the interim periods presented. All such adjustments are of a normal recurring nature. The condensed consolidated financial position, results of operations and cash flows for these interim periods are not necessarily indicative of the results that may be expected in future periods. The balance sheet at February 2, 2019 has been derived from the audited financial statements at that date. The financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019, filed with the U.S. Securities and Exchange Commission (the "SEC") on March 26, 2019.

Fiscal Year- Our fiscal year ends on the Saturday nearest to January 31. References to a fiscal year refer to the calendar year in which the fiscal year begins.

6

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Accounting Policies- The complete summary of significant accounting policies is included in the notes to the consolidated financial statements as presented in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019.

Variable Interest Entities- We have certain joint ventures ("JVs") where each joint venture licenses brands and contracts with Camuto Group to provide design, buying and sourcing services. Under the JVs, Camuto Group is responsible for managing all aspects of the brands and the JVs pay royalties, commissions, or consulting fees to the other parties. We are responsible for providing all funding to support the working capital needs of the JVs. As a result, we have determined that we are the primary beneficiary of the JVs and consolidate the JVs within our financial statements. Assets and liabilities of the JVs in the aggregate are immaterial. At the end of the three months ended August 3, 2019, we terminated two JVs along with related licensing and design, buying and sourcing arrangements.

Integration and Restructuring Costs- During the six months ended August 3, 2019, we incurred integration and restructuring costs related to our prior year acquisition activity, which consisted primarily of $3.6 million in severance, a $6.1 million termination fee for terminating two JVs, and $2.4 million of professional fees and other integration costs. During the six months ended August 4, 2018, we incurred restructuring costs of $2.7 million in severance, primarily related to changes to our store staffing model. These costs are included in operating expenses in the condensed consolidated statements of operations. As of August 3, 2019 and August 4, 2018, we had $4.6 million and $1.6 million, respectively, of severance liability included in accrued expenses on the condensed consolidated balance sheets.

Principles of Consolidation- The condensed consolidated financial statements include the accounts of Designer Brands Inc. and its subsidiaries, including the JVs. All intercompany accounts and transactions have been eliminated in consolidation. All amounts are in United States dollars ("USD"), unless otherwise noted.

Use of Estimates- The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenue and expenses during the reporting period. Significant estimates are required as a part of sales returns allowances, customer allowances and discounts, gift card breakage income, deferred revenue associated with loyalty programs, valuation of inventories, depreciation and amortization, impairments of long-lived assets, intangibles and goodwill, lease accounting, legal reserves, foreign tax contingent liabilities, income taxes, self-insurance reserves, and valuations used to account for acquisitions. Although these estimates are based on management's knowledge of current events and actions it may undertake in the future, actual results could differ from these estimates.

Income Taxes- Our effective tax rate changed from 203.3% for the six months ended August 4, 2018 to 27.9% for the six months ended August 3, 2019. The decrease in the effective tax rate was primarily driven by valuation allowances and the goodwill impairment associated with the TSL acquisition during the six months ended August 4, 2018.

Cash, Cash Equivalents, and Restricted Cash- Cash and cash equivalents represent cash, money market funds and credit card receivables that generally settle within three days. Restricted cash represented cash that was restricted as to withdrawal or usage and consisted of a mandatory cash deposit for certain outstanding letters of credit.

The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows:

(in thousands)	August 3, 2019		February 2, 2019		August 4, 2018
Cash and cash equivalents	$	51,762	$	99,369	$	215,996
Restricted cash, included in prepaid expenses and other current assets	—		1,199		—
Total cash, cash equivalents, and restricted cash shown in the condensed consolidated statements of cash flows	$	51,762	$	100,568	$	215,996

7

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Fair Value- Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are categorized using defined hierarchical levels related to the subjectivity associated with the inputs to fair value measurements as follows:

• Level 1 - Quoted prices in active markets for identical assets or liabilities.

• Level 2 - Quoted prices for similar assets or liabilities in active markets or inputs that are observable.

• Level 3 - Unobservable inputs in which little or no market activity exists.

We measure available-for-sale investments at fair value on a recurring basis. These investments are measured using a market-based approach using inputs such as prices of similar assets in active markets (categorized as Level 2). The carrying value of cash and cash equivalents, accounts receivables and accounts payables approximated their fair values due to their short-term nature.

Prior Period Reclassifications- Certain prior period reclassifications were made to conform to the current period presentation. Franchise costs was reclassified to operating expenses, and accounts payable to related parties was reclassified to accounts payable.

Adoption of ASU 2016-02, Leases- During the first quarter of fiscal 2019, we adopted the new accounting standard for leases, Accounting Standards Update ("ASU") 2016-02 and the related amendments. We elected to initially apply ASU 2016-02 as of February 3, 2019, with the recognition of $1.0 billion of lease assets and $1.1 billion of lease liabilities and a cumulative-effect adjustment that decreased retained earnings by $9.6 million for transition impairments related to previously impaired leased locations. Periods prior to February 3, 2019 were not restated. Upon transition to ASU 2016-02, we recognized lease liabilities based on the present value of the remaining future fixed lease commitments, net of outstanding tenant allowance receivables, with corresponding lease assets. Amounts for prepaid expenses, deferred rent, deferred construction and tenant allowances, the accrual for lease obligations, and favorable and unfavorable leasehold interests were netted against the lease assets. At transition, we elected the package of practical expedients, which allows us to carry forward the historical lease classification and not reassess whether any expired or existing contracts are leases or contain leases. We did not elect the use of hindsight to determine the term of our leases at transition.

A lease liability for new leases is recorded based on the present value of future fixed lease commitments with a corresponding lease asset. For leases classified as operating leases, we recognize a single lease cost on a straight-line basis based on the combined amortization of the lease liability and the lease asset. Other leases will be accounted for as finance arrangements. For real estate leases, we are generally required to pay base rent, real estate taxes, and insurance, which are considered lease components, and maintenance, which is a non-lease component. As provided for under ASU 2016-02, we have elected to not separate non-lease payment components from the associated lease component for all new real estate leases. We determine the discount rate for each lease by estimating the rate that we would be required to pay on a secured borrowing for an amount equal to the lease payments over the lease term.

Prior to the adoption of ASU 2016-02, we recognized rent expense on a straight-line basis over the noncancelable terms of the lease. For leases with fixed increases of the minimum rentals during the noncancelable term, we recorded the difference between the amounts charged to expense and the rent paid as deferred rent and amortized such deferred rent upon the delivery of the lease location by the lessor. In addition, cash allowances received from landlords were deferred and amortized on a straight-line basis over the noncancelable terms of the lease as a reduction of rent expense. Deferred rent and construction and tenant allowances are included in non-current liabilities on the condensed consolidated balance sheets for periods prior to February 3, 2019. Also, we recorded reserves for leased spaces that were abandoned due to closure. Using a credit-adjusted risk-free rate to calculate the present value of the liability, we estimated future lease obligations based on remaining fixed lease payments, estimated or actual sublease income, and any other relevant factors.

Adoption of ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software- Also during the first quarter of fiscal 2019, we early adopted ASU 2018-15 on a prospective basis, which aligned the requirements for capitalizing implementation costs incurred in a cloud computing arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or acquire internal-use software. The adoption of ASU 2018-15 did not have a material impact on our condensed consolidated financial statements.

8

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

2.    ACQUISITIONS AND EQUITY METHOD INVESTMENT

Step Acquisition of TSL- On May 10, 2018, we acquired the remaining interest in TSL for $36.2 million Canadian dollars ("CAD") ($28.2 million USD), net of acquired cash of $8.5 million CAD ($6.6 million USD), by exercising our call option. This was accounted for as a step acquisition whereby we remeasured to fair value our previously held assets, which included our equity investment in TSL and notes and accounts receivable from TSL, and included these assets in the determination of the purchase price. During the second quarter of fiscal 2018, as a result of the remeasurement, we recorded a loss of $34.0 million to non-operating income (expenses), net, in the consolidated statements of operations. Also during the second quarter of fiscal 2018, we reclassified a net loss of $12.2 million of foreign currency translation adjustments related to the previously held balances from accumulated other comprehensive loss to non-operating income (expenses), net.

The purchase price and the allocation of the total consideration to the fair values of the assets and liabilities acquired was finalized as of February 2, 2019 and consisted of the following (in USD):

(in thousands)	Final Purchase Price and Allocation
Purchase price:
Cash consideration, net of cash acquired	$	28,152
Replacement stock-based awards attributable to pre-acquisition services	196
Fair value of previously held assets	92,242
	$	120,590
Fair value of assets and liabilities acquired:
Inventories	$	66,072
Other current assets	3,687
Property and equipment	41,008
Goodwill	43,022
Intangible assets	20,689
Accounts payable and accrued expenses	(33,196		)
Non-current liabilities	(20,692		)
	$	120,590

The fair value of previously held assets was determined immediately before the business combination, primarily by considering the income valuation approach (discounted cash flow) and the market valuation approach (precedent comparable transactions). Additionally, other information such as current market, industry and macroeconomic conditions were utilized to assist in developing these fair value measurements. The fair value of intangible assets includes $15.7 million for tradenames, $3.6 million for favorable leasehold interests, and $1.4 million for customer relationships associated with the Canada loyalty program. The fair value of unfavorable leasehold interests, included in non-current liabilities, was $7.6 million. The fair value for tradenames was determined using the relief from royalty method of the income approach, the fair value for leasehold interests was determined based on the market valuation approach, and the fair value for customer relationships related to the loyalty program was determined using the replacement cost method. The fair values for property and equipment were determined using the cost and market approaches. The fair value of inventories, which is made up of finished goods, was determined based on market assumptions for realizing a reasonable profit after selling costs.

The goodwill represents the excess of the purchase price over the fair value of the net assets acquired. With this being a step acquisition, the purchase price included the fair value of our previously held assets, which considered the valuation of the TSL enterprise. This valuation identified that the resulting goodwill was not supportable as the value of the acquired net assets exceeded the enterprise fair value. As a result, during fiscal 2018, we recorded a goodwill impairment charge, net of adjustments as a result of recording adjustments to the preliminary purchase allocations, which resulted in impairing all of the Canada Retail segment's goodwill. A portion of the goodwill is not expected to be deductible for income tax purposes.

During the three months and six months ended August 4, 2018, our condensed consolidated statements of operations included revenue and net losses for TSL of $72.5 million and $38.5 million, respectively, which included the goodwill impairment charge of $36.2 million. Primarily in fiscal 2018, we incurred $3.1 million of acquisition-related costs as a result of the step

9

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

acquisition (not included in the TSL net loss disclosed in the previous sentence), which were included in operating expenses in the condensed consolidated statements of operations.

Acquisition of Camuto Group- On November 5, 2018, we completed the acquisition of all of the outstanding securities of Camuto Group for $171.3 million, net of acquired cash of $9.7 million. The purchase price of the acquisition, along with the acquired equity investment in ABG-Camuto (discussed below), was funded with available cash and borrowings on the revolving line of credit of $160.0 million.

The following table summarizes the preliminary and revised purchase price and the allocation of the total consideration to the fair values of the assets and liabilities acquired:

(in thousands)	Preliminary Purchase Price and Allocation as of November 5, 2018			Measurement Period Adjustments			Revised Purchase Price and Allocation as of August 3, 2019
Purchase price -
Cash consideration, net of cash acquired	$	171,251		$	—		$	171,251
Fair value of assets and liabilities acquired:
Accounts receivable	$	83,939		$	3,980		$	87,919
Inventories	74,499			(758		)	73,741
Other current assets	7,197			1,045			8,242
Property and equipment	43,906			960			44,866
Goodwill	63,614			26,767			90,381
Intangible asset	27,000			(21,700		)	5,300
Other assets	13,351			—			13,351
Accounts payable and other liabilities	(122,811		)	(2,195		)	(125,006		)
Non-current liabilities	(19,444		)	(8,099		)	(27,543		)
	$	171,251		$	—		$	171,251

The fair value of the intangible asset relates to customer relationships and was based on the excess earnings method under the income approach. The fair value measurement is based on significant unobservable inputs, including the future cash flows and discount and customer attrition rates. The fair values for property and equipment were determined using the cost and market approaches. The fair value of inventories, which is made up of finished goods, was determined based on market assumptions for realizing a reasonable profit after selling costs. The inventory valuation step-up was recognized to cost of goods sold during the fourth quarter of fiscal 2018 based on assumed inventory turns.

The goodwill represents the excess of the purchase price over the fair value of the net assets acquired, and was primarily attributable to acquiring an established design and sourcing process, which provides us the opportunity to expand our exclusive products offering at a lower cost in our retail segments, and an assembled workforce. Goodwill is expected to be deductible for income tax purposes.

Non-current liabilities include $12.7 million of estimated unpaid foreign payroll and other taxes. We recorded an offsetting indemnification asset to other assets, which we expect to collect under the terms of the securities purchase agreement with the Sellers. See Note 16, Commitments and Contingencies, for additional information.

Adjustments made during the three months ended August 3, 2019 are the result of refining preliminary cash flow assumptions relating to certain synergy assumptions to the various reporting units, adjusting accruals and related indemnification receivables based on additional information, and other immaterial adjustments identified as we perform additional analysis of the assets and liabilities acquired. Adjustments to the purchase price and the allocation of the purchase price may be made during a measurement period of up to one year from the acquisition date as additional information that existed at the date of the acquisition is obtained. Measurement period adjustments are recognized on a prospective basis in the period of change. The purchase price is subject to adjustments primarily based upon a working capital provision as provided by the purchase agreement. The allocation of the purchase price is currently based on certain preliminary valuations and analysis that have not been completed as of the date of this filing. In addition, we have not completed the allocation of goodwill to our U.S. Retail and Brand Portfolio segments or the reporting units within the Brand Portfolio segment.

10

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Primarily during fiscal 2018, we incurred $22.2 million of acquisition-related costs as a result of the acquisition, which were included in operating expenses in the condensed consolidated statements of operations.

Equity Investment in ABG-Camuto- On November 5, 2018, we acquired a 40% interest in the newly formed ABG-Camuto joint venture for $56.8 million in partnership with Authentic Brands Group LLC. Also on November 5, 2018, ABG-Camuto acquired several intellectual property rights from the Sellers and entered into a licensing agreement with us, which earns royalties from the net sales of Camuto Group under the brands acquired.

Activity related to our equity investment in ABG-Camuto was as follows:

(in thousands)	Six Months Ended August 3, 2019
Balance at beginning of period	$	58,125
Share of net earnings	4,692
Distributions received	(7,784		)
Balance at end of period	$	55,033

Combined Results- The following table provides the supplemental pro forma total revenue and net loss of the combined entity had the acquisition dates of TSL and Camuto Group and the investment in ABG-Camuto been the first day of our fiscal 2017:

(in thousands)	Three months ended August 4, 2018			Six months ended August 4, 2018
Total revenue	$	886,780		$	1,755,210
Net loss	$	(45,722	)	$	(33,131	)

The amounts in the supplemental pro forma results apply our accounting policies, eliminate intercompany transactions, assume the acquisition-related transaction costs were incurred in fiscal 2017, and reflect adjustments for additional expenses that would have been charged assuming borrowings on the revolving line of credit of $160 million and the same fair value adjustments to inventory, property and equipment, and acquired intangibles had been applied on the first day of our fiscal 2017. Related to the TSL acquisition, the supplemental pro forma results also exclude the loss related to the remeasurement of previously held assets, the net loss of foreign currency translation related to the previously held balances from accumulated other comprehensive loss, and the goodwill impairment charge. Because the ABG-Camuto investment was integral to the Camuto Group acquisition, the supplemental pro forma results include royalty expenses that would be due to ABG-Camuto using the guaranteed minimum royalties per the license agreement and the related earnings from our equity investment in ABG-Camuto had the transactions occurred on the first day of our fiscal 2017. Accordingly, these supplemental pro forma results have been prepared for comparative purposes only and are not intended to be indicative of results of operations that would have occurred had the acquisitions actually occurred in the prior year period or indicative of the results of operations for any future period.

11

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

3.    REVENUE

Disaggregation of Revenue- The following table presents our total revenue disaggregated by segments:

	Three months ended					Six months ended
(in thousands)	August 3, 2019			August 4, 2018		August 3, 2019			August 4, 2018
Segment net sales:
U.S. Retail	$	677,920		$	691,757	$	1,369,760		$	1,361,541
Canada Retail	63,306			72,532		115,122			72,532
Brand Portfolio	95,422			—		196,289			—
Other	29,480			29,446		65,087			70,099
Total net sales	866,128			793,735		1,746,258			1,504,172
Commission, franchise and other revenue	11,771			1,533		20,676			3,198
	877,899			795,268		1,766,934			1,507,370
Elimination of intersegment revenue	(17,701		)	—		(28,221		)	—
Total revenue	$	860,198		$	795,268	$	1,738,713		$	1,507,370

The U.S. Retail and Brand Portfolio segments and Other net sales recognized are primarily based on sales to customers in the U.S., and Canada Retail segment net sales recognized are based on sales to customers in Canada. Revenue realized from geographic markets outside of the U.S. and Canada have collectively been immaterial.

The following table presents total revenue by product and service category:

	Three months ended					Six months ended
(in thousands)	August 3, 2019			August 4, 2018		August 3, 2019			August 4, 2018
Net sales:
U.S. Retail segment:
Women's footwear	$	458,390		$	467,337	$	940,511		$	936,621
Men's footwear	140,895			151,573		269,884			284,732
Accessories, kids and other	78,635			72,847		159,365			140,188
	677,920			691,757		1,369,760			1,361,541
Canada Retail segment:
Women's footwear	35,533			42,067		64,159			42,067
Men's footwear	16,432			19,455		29,440			19,455
Accessories, kids and other	11,341			11,010		21,523			11,010
	63,306			72,532		115,122			72,532
Brand Portfolio segment:
Wholesale	88,577			—		180,331			—
Direct-to-consumer	6,845			—		15,958			—
	95,422			—		196,289			—
Other	29,480			29,446		65,087			70,099
Total net sales	866,128			793,735		1,746,258			1,504,172
Commission, franchise and other revenue	11,771			1,533		20,676			3,198
	877,899			795,268		1,766,934			1,507,370
Elimination of intersegment revenue	(17,701		)	—		(28,221		)	—
Total revenue	$	860,198		$	795,268	$	1,738,713		$	1,507,370

12

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Deferred Revenue Liabilities- We record deferred revenue liabilities, included in accrued expenses on the condensed consolidated balance sheets, for remaining obligations we have to our customers. The following table presents the changes and total balances for gift cards and our loyalty programs:

	Three months ended						Six months ended
(in thousands)	August 3, 2019			August 4, 2018			August 3, 2019			August 4, 2018
Gift cards:
Beginning of period	$	30,066		$	28,151		$	34,998		$	32,792
Gift cards redeemed and breakage recognized to net sales	(21,843		)	(21,761		)	(44,098		)	(44,034		)
Gift cards issued	20,054			20,401			37,377			38,033
End of period	$	28,277		$	26,791		$	28,277		$	26,791
Loyalty programs:
Beginning of period	$	16,153		$	22,111		$	16,151		$	21,282
Loyalty certificates redeemed and expired and other adjustments recognized to net sales	(9,507		)	(16,750		)	(18,828		)	(23,385		)
Deferred revenue for loyalty points issued	9,388			11,425			18,711			18,889
End of period	$	16,034		$	16,786		$	16,034		$	16,786

4.    RELATED PARTY TRANSACTIONS

Schottenstein Affiliates

As of August 3, 2019, the Schottenstein Affiliates, entities owned or controlled by Jay L. Schottenstein, the executive chairman of our Board of Directors, and members of his family, beneficially owned approximately 15% of the Company's outstanding common shares, representing approximately 51% of the combined voting power. As of August 3, 2019, the Schottenstein Affiliates beneficially owned 3.4 million Class A common shares and 7.7 million Class B common shares. We had the following related party transactions with Schottenstein Affiliates:

Leases- We lease our fulfillment center and certain store locations owned by Schottenstein Affiliates. See Note 15, Leases, for rent expense and future minimum lease payment requirements associated with the Schottenstein Affiliates.

Other Purchases and Services- During the three months ended August 3, 2019 and August 4, 2018, we had other purchases and services from Schottenstein Affiliates of $1.5 million and $1.7 million, respectively. During the six months ended August 3, 2019 and August 4, 2018, we had other purchases and services from Schottenstein Affiliates of $3.4 million and $3.3 million, respectively.

Due to Related Parties- As of August 3, 2019, February 2, 2019 and August 4, 2018, we had amounts due to related parties of $0.5 million, $1.0 million and $0.5 million, respectively, included in accounts payable on the condensed consolidated balance sheets.

ABG-Camuto

Beginning in the fourth quarter of fiscal 2018, we have a 40% interest in ABG-Camuto. ABG-Camuto entered into a licensing agreement with us whereby we pay royalties on the net sales of the brands owned by ABG-Camuto. During the three and six months ended August 3, 2019, we recorded $3.6 million and $9.3 million of royalty expense payable to ABG-Camuto, respectively. As of February 2, 2019, we had $2.4 million payable to ABG-Camuto, included in accrued expenses on the condensed consolidated balance sheets.

13

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

5.    EARNINGS (LOSS) PER SHARE

Basic earnings (loss) per share is based on net income (loss) and the weighted average of Class A and Class B common shares outstanding. Diluted earnings (loss) per share reflects the potential dilution of common shares adjusted for outstanding stock options, restricted stock units ("RSUs"), and performance-based restricted stock units ("PSUs") calculated using the treasury stock method.

The following is a reconciliation of the number of shares used in the calculation of earnings (loss) per share:

	Three months ended		Six months ended
(in thousands)	August 3, 2019	August 4, 2018	August 3, 2019	August 4, 2018
Weighted average basic shares outstanding	73,529	80,265	75,267	80,187
Dilutive effect of stock-based compensation awards	787	—	1,014	—
Weighted average diluted shares outstanding	74,316	80,265	76,281	80,187

For the three months ended August 3, 2019 and August 4, 2018, the number of potential shares that were not included in the computation of diluted earnings (loss) per share due to the anti-dilutive effect was 4.6 million and 3.2 million, respectively. For the six months ended August 3, 2019 and August 4, 2018, the number of potential shares that were not included in the computation of diluted earnings (loss) per share due to the anti-dilutive effect was 2.9 million and 3.2 million, respectively.

6.    STOCK-BASED COMPENSATION

Stock-based compensation expense consisted of the following:

	Three months ended				Six months ended
(in thousands)	August 3, 2019		August 4, 2018		August 3, 2019		August 4, 2018
Stock options	$	563	$	1,343	$	1,386	$	3,138
Restricted and director stock units	4,798		3,841		8,345		6,560
	$	5,361	$	5,184	$	9,731	$	9,698

The following table summarizes the stock-based compensation award activity for the six months ended August 3, 2019:

	Number of shares
(in thousands)	Stock Options		Time-Based RSUs		Performance-Based RSUs
Outstanding - beginning of period	4,001		989		596
Granted	—		841		358
Exercised / vested	(99	)	(111	)	(97	)
Forfeited / expired	(38	)	(56	)	—
Outstanding - end of period	3,864		1,663		857

As of August 3, 2019, 2.7 million shares of Class A common shares remain available for future stock-based compensation grants under the 2014 Long-Term Incentive Plan.

7.    SHAREHOLDERS' EQUITY

Shares- Our Class A common shares are listed for trading under the ticker symbol "DBI" on the New York Stock Exchange. There is currently no public market for the Company's Class B common shares, but the Class B common shares can be exchanged for the Company's Class A common shares at the election of the holder on a share for share basis. Holders of Class A common shares are entitled to one vote per share and holders of Class B common shares are entitled to eight votes per share on matters submitted to shareholders for approval.

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DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

The following table provides additional information for our common shares:

	August 3, 2019		February 2, 2019		August 4, 2018
(in thousands)	Class A	Class B	Class A	Class B	Class A	Class B
Authorized shares	250,000	100,000	250,000	100,000	250,000	100,000
Issued shares	86,080	7,733	85,763	7,733	85,652	7,733
Outstanding shares	64,911	7,733	70,672	7,733	72,561	7,733
Treasury shares	21,169	—	15,091	—	13,091	—

We have authorized 100 million shares of no par value preferred shares with no shares issued for any of the periods presented.

Dividends- On August 29, 2019, the Board of Directors declared a quarterly cash dividend payment of $0.25 per share for both Class A and Class B common shares. The dividend will be paid on October 4, 2019 to shareholders of record at the close of business on September 20, 2019.

Share Repurchases- On August 17, 2017, the Board of Directors authorized the repurchase of an additional $500 million of Class A common shares under our share repurchase program, which was added to the $33.5 million remaining from the previous authorization. During the six months ended August 3, 2019, we repurchased 6.1 million Class A common shares at a cost of $125.0 million, with $351.6 million of Class A common shares that remain authorized under the program as of August 3, 2019. During the six months ended August 4, 2018, we did not repurchase any Class A common shares. The share repurchase program may be suspended, modified or discontinued at any time, and we have no obligation to repurchase any amount of our common shares under the program. Shares will be repurchased in the open market at times and in amounts considered appropriate based on price and market conditions.

Accumulated Other Comprehensive Loss- Changes for the balances of each component of accumulated other comprehensive loss were as follows (all amounts are net of tax):

	Three months ended
	August 3, 2019									August 4, 2018
(in thousands)	Foreign Currency Translation			Available-for-Sale Securities			Total			Foreign Currency Translation			Available-for-Sale Securities			Total
Accumulated other comprehensive loss - beginning of period	$	(3,042	)	$	(224	)	$	(3,266	)	$	(12,218	)	$	(980	)	$	(13,198	)
Other comprehensive income (loss) before reclassifications	461			196			657			(1,365		)	27			(1,338		)
Amounts reclassified to non-operating income (expenses), net	—			23			23			12,218			42			12,260
Other comprehensive income	461			219			680			10,853			69			10,922
Accumulated other comprehensive loss - end of period	$	(2,581	)	$	(5	)	$	(2,586	)	$	(1,365	)	$	(911	)	$	(2,276	)

15

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

	Six months ended
	August 3, 2019									August 4, 2018
(in thousands)	Foreign Currency Translation			Available-for-Sale Securities			Total			Foreign Currency Translation			Available-for-Sale Securities			Total
Accumulated other comprehensive loss - beginning of period	$	(2,328	)	$	(378	)	$	(2,706	)	$	(9,278	)	$	(796	)	$	(10,074	)
Other comprehensive income (loss) before reclassifications	(253		)	438			185			(6,050		)	(317		)	(6,367		)
Amounts reclassified to non-operating expenses, net	—			(65		)	(65		)	13,963			202			14,165
Other comprehensive income (loss)	(253		)	373			120			7,913			(115		)	7,798
Accumulated other comprehensive loss - end of period	$	(2,581	)	$	(5	)	$	(2,586	)	$	(1,365	)	$	(911	)	$	(2,276	)

8.    ACCOUNTS RECEIVABLE

Accounts receivable, net, consisted of the following:

(in thousands)	August 3, 2019			February 2, 2019			August 4, 2018
Customer accounts receivables:
Serviced by third-party provider with guaranteed payment	$	61,494		$	47,599		$	—
Serviced by third-party provider without guaranteed payment	495			280			—
Serviced in-house	10,145			9,892			3,090
Construction and tenant allowance receivables due from landlords(1)	—			4,034			5,201
Other receivables	14,460			8,004			8,968
Accounts receivable	86,594			69,809			17,259
Allowance for doubtful accounts	(1,432		)	(939		)	—
Accounts receivable, net	$	85,162		$	68,870		$	17,259

(1) Upon transition to ASU 2016-02 at the beginning of fiscal 2019, amounts for construction and tenant allowance receivables due from landlords were netted against the operating lease liabilities.

9.    INVESTMENTS

Investments in available-for-sale securities consisted of the following:

(in thousands)	August 3, 2019			February 2, 2019			August 4, 2018
Carrying value of investments	$	25,510		$	70,195		$	73,978
Unrealized gains included in accumulated other comprehensive loss	18			44			10
Unrealized losses included in accumulated other comprehensive loss	(24		)	(521		)	(869		)
Fair value	$	25,504		$	69,718		$	73,119

16

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

10.    PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

(in thousands)	August 3, 2019			February 2, 2019			August 4, 2018
Land	$	1,110		$	1,110		$	1,110
Buildings	13,445			12,485			12,485
Building and leasehold improvements	440,425			437,116			425,651
Furniture, fixtures and equipment	489,805			487,494			451,040
Software	183,226			161,226			145,111
Construction in progress(1)	41,454			38,646			46,643
Total property and equipment	1,169,465			1,138,077			1,082,040
Accumulated depreciation and amortization	(766,686		)	(728,501		)	(694,419		)
Property and equipment, net	$	402,779		$	409,576		$	387,621

(1) Construction in progress is comprised primarily of the construction of leasehold improvements and furniture and fixtures related to unopened stores and internal-use software under development.

11.    GOODWILL AND INTANGIBLE ASSETS

Goodwill- Activity related to our goodwill was as follows:

	Six months ended
	August 3, 2019								August 4, 2018
(in thousands)	Goodwill			Accumulated Impairments			Net		Goodwill			Accumulated Impairments			Net
Beginning of period by segment:
U.S. Retail	$	25,899		$	—		$	25,899	$	25,899		$	—		$	25,899
Canada Retail	42,048			(42,048		)	—		—			—			—
Brand Portfolio	63,614			—			63,614		—			—			—
Other	—			—			—		53,790			(53,790		)	—
	131,561			(42,048		)	89,513		79,689			(53,790		)	25,899
Activity by segment:
Canada Retail:
Acquired TSL goodwill	—			—			—		37,044			—			37,044
Impairment charges	—			—			—		—			(36,240		)	(36,240		)
Currency translation adjustment	(416		)	416			—		(580		)	(224		)	(804		)
Brand Portfolio -
Purchase price and allocation adjustments	26,767			—			26,767		—			—			—
Other - Eliminated goodwill from Ebuys exit	—			—			—		(53,790		)	53,790			—
	26,351			416			26,767		(17,326		)	17,326			—
End of period by segment:
U.S. Retail	25,899			—			25,899		25,899			—			25,899
Canada Retail	41,632			(41,632		)	—		36,464			(36,464		)	—
Brand Portfolio	90,381			—			90,381		—			—			—
	$	157,912		$	(41,632	)	$	116,280	$	62,363		$	(36,464	)	$	25,899

17

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Intangible Assets- Intangible assets consisted of the following:

(in thousands)	Cost		Accumulated Amortization			Net
August 3, 2019
Definite-lived customer relationships	$	6,661	$	(1,064	)	$	5,597
Indefinite-lived trademarks and tradenames	15,515		—			15,515
	$	22,176	$	(1,064	)	$	21,112
February 2, 2019
Definite-lived:
Customer relationships	$	28,375	$	(1,010	)	$	27,365
Favorable leasehold interests	3,513		(295		)	3,218
Indefinite-lived trademarks and tradenames	15,546		—			15,546
	$	47,434	$	(1,305	)	$	46,129
August 4, 2018
Definite-lived:
Customer relationships	$	1,378	$	(114	)	$	1,264
Favorable leasehold interests	3,522		(101		)	3,421
Indefinite-lived trademarks and tradenames	15,600		—			15,600
	$	20,500	$	(215	)	$	20,285

The customer relationships are amortized by the straight-line method over three years associated with the Canada loyalty program and eight years for Brand Portfolio customer relationships. Upon transition to ASU 2016-02 at the beginning of fiscal 2019, amounts for favorable leasehold interests were netted against the operating lease assets.

12.    ACCRUED EXPENSES

Accrued expenses consisted of the following:

(in thousands)	August 3, 2019		February 2, 2019		August 4, 2018
Gift cards and merchandise credits	$	28,277	$	34,998	$	26,791
Accrued compensation and related expenses	38,532		53,577		30,224
Accrued taxes	18,330		16,491		21,029
Loyalty programs deferred revenue	16,034		16,151		16,786
Sales returns	19,332		17,743		14,426
Customer allowances and discounts	9,306		13,094		—
Other(1)	43,626		49,481		36,520
	$	173,437	$	201,535	$	145,776

(1) Other is comprised of various other accrued expenses that we expect will settle within one year of the applicable period.

18

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

13.    OTHER NON-CURRENT LIABILITIES

Other non-current liabilities consisted of the following:

(in thousands)	August 3, 2019		February 2, 2019		August 4, 2018
Foreign tax contingent liabilities	$	14,807	$	13,429	$	—
Deferred tax liabilities	3,393		3,260		—
Construction and tenant allowances(1)	—		71,634		75,439
Deferred rent(1)	—		35,934		35,694
Accrual for lease obligations(1)	—		16,483		9,511
Unfavorable leasehold interests(1)	—		5,779		7,000
Other(2)	20,390		18,528		22,672
	$	38,590	$	165,047	$	150,316

(1) Upon transition to ASU 2016-02 at the beginning of fiscal 2019, amounts for deferred rent, construction and tenant allowances, the accrual for lease obligations, and unfavorable leasehold interests were netted against the operating lease assets.

(2) Other is comprised of various other accrued expenses that we expect will settle beyond one year from the end of the applicable period.

The following table presents the changes and total balances for the accrual for lease obligations:

	Six months ended
(in thousands)	August 3, 2019			August 4, 2018
Beginning of period	$	16,483		$	6,511
Netted against lease assets upon transition to ASU 2016-02	(16,483		)	—
Additions	—			4,884
Lease obligation payments, net of sublease income	—			(2,004		)
Adjustments	—			120
End of period	$	—		$	9,511

14.    DEBT

Credit Facility- On August 25, 2017, we entered into a senior unsecured revolving credit agreement (the "Credit Facility") with a maturity date of August 25, 2022 that replaced our previous secured revolving credit agreement and letter of credit agreement. On October 10, 2018, the Credit Facility was amended to include the acquisition of Camuto Group as a permitted acquisition and, following the acquisition, to utilize an accordion feature that provided for an increase to the revolving line of credit. On November 5, 2018, following the acquisition of Camuto Group, the amended Credit Facility was increased with no change to the sub-limits. As of August 3, 2019, the Credit Facility provided a revolving line of credit up to $400 million, with sub-limits for the issuance of up to $50 million in letters of credit, swing loan advances of up to $15 million, and the issuance of up to $75 million in foreign currency revolving loans and letters of credit. The Credit Facility may be used to provide funds for working capital, capital expenditures, share repurchases, other expenditures, and permitted acquisitions as defined by the Credit Facility. Our Credit Facility allows the payments of dividends by us or our subsidiaries, provided that immediately before and after a dividend payment there is no event of default, as defined in our Credit Facility.

Loans issued under the revolving line of credit bear interest, at our option, at a base rate or an alternate base rate as defined in the Credit Facility plus a margin based on our leverage ratio, with an interest rate of 4.1% as of August 3, 2019. Any loans issued in CAD bear interest at the alternate base rate plus a margin based on our leverage ratio. Interest on letters of credit issued under the Credit Facility is variable based on our leverage ratio and the type of letters of credit, with an interest rate of 1.7% as of August 3, 2019. Commitment fees are based on the average unused portion of the Credit Facility at a variable rate based on our leverage ratio. As of August 3, 2019, we had $235.0 million outstanding under the Credit Facility and $1.3 million in letters of credit issued, resulting in $163.7 million available for borrowings. Interest expense related to the Credit Facility includes interest on borrowings and letters of credit, commitment fees and the amortization of debt issuance costs.

19

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Debt Covenants- The Credit Facility contains financial and other covenants, including, but not limited to, limitations on indebtedness, liens and investments, as well as the maintenance of a leverage ratio not to exceed 3.25:1 and a fixed charge coverage ratio not to be less than 1.75:1. As a result of the acquisition of Camuto Group, we have elected to increase the leverage ratio whereby we must maintain a leverage ratio not to exceed 3.50:1 as of the end of the fourth quarter of fiscal 2018 and for the subsequent three quarters. A violation of any of the covenants could result in a default under the Credit Facility that would permit the lenders to restrict our ability to further access the Credit Facility for loans and letters of credit and require the immediate repayment of any outstanding loans under the Credit Facility. As of August 3, 2019, we were in compliance with all financial covenants.

15. LEASES

We lease our stores, fulfillment center and other facilities under operating lease arrangements with unrelated parties and related parties owned by Schottenstein Affiliates. The majority of our real estate leases provide for renewal options, which are typically not included in the lease term used for measuring the lease assets and lease liabilities as it is not reasonably certain we will exercise options. We pay variable amounts for certain lease and non-lease components as well as for contingent rentals based on sales for certain leases where the sales are in excess of specified levels and for leases that have certain contingent triggering events that are in effect. We also lease equipment under operating leases.

We receive operating lease income from unrelated third parties for leasing portions or all of certain owned and leased properties. Operating lease income is included in commission, franchise and other revenue in our condensed consolidated statements of operations.

Lease income and lease expense consisted of the following for the three and six months ended August 3, 2019 (after the adoption of ASU 2016-02) and August 4, 2018 (prior to the adoption of ASU 2016-02):

	Three months ended				Six months ended
(in thousands)	August 3, 2019		August 4, 2018		August 3, 2019		August 4, 2018
Operating lease income	$	2,236	$	1,149	$	4,448	$	2,297
Operating lease expense:
Lease expense to unrelated parties	$	52,707	$	51,263	$	106,061	$	96,748
Lease expense to related parties	2,371		2,303		4,713		4,591
Variable lease expense to unrelated parties	12,981		5,675		26,003		12,498
Variable lease expense to related parties	348		—		650		—
	$	68,407	$	59,241	$	137,427	$	113,837

	August 3, 2019
Other operating lease information:
Weighted-average remaining lease term	6.3 years
Weighted-average discount rate	3.9	%

20

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

As of August 3, 2019, our future fixed minimum lease payments are as follows:

(in thousands)	Unrelated Parties			Related Parties			Total
Remainder of fiscal 2019	$	96,844		$	3,937		$	100,781
Fiscal 2020	233,961			9,364			243,325
Fiscal 2021	216,107			8,697			224,804
Fiscal 2022	182,432			7,418			189,850
Fiscal 2023	142,408			4,573			146,981
Future fiscal years thereafter	314,601			15,493			330,094
	1,186,353			49,482			1,235,835
Less discounting impact on operating leases	(138,305		)	(6,015		)	(144,320		)
Total operating lease liabilities	1,048,048			43,467			1,091,515
Less current operating lease liabilities	(178,091		)	(7,878		)	(185,969		)
Non-current operating lease liabilities	$	869,957		$	35,589		$	905,546

As of August 3, 2019, we have entered into lease commitments for four new store locations and two store relocations where the leases have not yet commenced, and the lease liabilities have not yet been recorded. We expect the lease commencement to begin in the next fiscal quarter for these locations and we will record additional operating lease liabilities of approximately $11.4 million.

As of February 2, 2019, future minimum lease payment requirements, excluding contingent rental payments, maintenance, insurance, real estate taxes, and the amortization of deferred rent and construction and tenant allowances, consisted of the following, as determined prior to the adoption of ASU 2016-02:

(in thousands)	Unrelated Parties		Related Parties		Total
Fiscal 2019	$	233,237	$	9,425	$	242,662
Fiscal 2020	227,001		9,364		236,365
Fiscal 2021	204,803		8,697		213,500
Fiscal 2022	170,030		6,518		176,548
Fiscal 2023	131,594		1,874		133,468
Future fiscal years thereafter	298,437		5,596		304,033
	$	1,265,102	$	41,474	$	1,306,576

16.    COMMITMENTS AND CONTINGENCIES

Legal Proceedings- We are involved in various legal proceedings that are incidental to the conduct of our business. Although it is not possible to predict with certainty the eventual outcome of any litigation, we believe the amount of any potential liability with respect to current legal proceedings will not be material to the results of operations or financial condition. As additional information becomes available, we will assess any potential liability related to pending litigation and revise the estimates as needed.

Foreign Tax Contingencies- During the due diligence procedures performed related to the acquisition of Camuto Group, we identified probable contingent liabilities associated with unpaid foreign payroll and other taxes that could also result in assessed penalties and interest. We have developed an estimate of the range of outcomes related to these obligations of $14.8 million to $30.0 million for obligations we are aware of at this time. As of August 3, 2019, we recorded a contingent liability of $14.8 million representing the low end of the range and an indemnification asset of $12.7 million representing the estimated amount as of the acquisition date, which we expect to collect under the terms of the securities purchase agreement with the Sellers. We are continuing to assess the exposure, which may result in material changes to these estimates, and we may identify additional contingent liabilities. We believe that the Sellers are obligated to indemnify us for any payments to foreign taxing authorities for the periods up to the acquisition date. Although a portion of the purchase price is held in escrow and another portion is held in a restricted bank account, there can be no assurance that we will successfully collect all amounts that we may be obligated to settle with the foreign taxing authorities.

21

DESIGNER BRANDS INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Guarantee- As a result of a previous merger, we provided a guarantee for a lease commitment that is scheduled to expire in 2024 for a location that has been leased to a third party. If the third party does not pay the rent or vacates the premise, we may be required to make full rent payments to the landlord. As of August 3, 2019, the total future minimum lease payment requirements for this guarantee were approximately $15.0 million.

17.    SEGMENT REPORTING

Our three reportable segments, which are also operating segments, are the U.S. Retail segment, the Canada Retail segment, and the Brand Portfolio segment. All other operating segments are below the quantitative and qualitative thresholds for reportable segments and are aggregated into Other for segment reporting purposes. The following provides certain financial data by segment reconciled to the condensed consolidated financial statements:

(in thousands)	U.S. Retail		Canada Retail		Brand Portfolio		Other		Corporate/Eliminations			Total
Three months ended August 3, 2019
External revenue:
Net sales	$	677,920	$	63,306	$	78,934	$	29,480	$	—		$	849,640
Commission, franchise and other revenue	—		—		6,312		—		4,246			10,558
Total revenue	$	677,920	$	63,306	$	85,246	$	29,480	$	4,246		$	860,198
Intersegment revenue	$	—	$	—	$	17,701	$	—	$	(17,701	)	$	—
Gross profit(1)	$	208,056	$	21,939	$	19,261	$	6,041	$	(436	)	$	254,861
Income from equity investment in ABG-Camuto	$	—	$	—	$	2,464	$	—	$	—		$	2,464
Three months ended August 4, 2018
Revenue:
Net sales	$	691,757	$	72,532	$	—	$	29,446	$	—		$	793,735
Commission, franchise and other revenue	—		—		—		—		1,533			1,533
Total revenue	$	691,757	$	72,532	$	—	$	29,446	$	1,533		$	795,268
Gross profit(1)	$	229,601	$	18,218	$	—	$	6,676	$	—		$	254,495
Six months ended August 3, 2019
External revenue:
Net sales	$	1,369,760	$	115,122	$	169,663	$	65,087	$	—		$	1,719,632
Commission, franchise and other revenue	—		—		9,609		—		9,472			19,081
Total revenue	$	1,369,760	$	115,122	$	179,272	$	65,087	$	9,472		$	1,738,713
Intersegment revenue	$	—	$	—	$	28,221	$	—	$	(28,221	)	$	—
Gross profit(1)	$	417,947	$	37,686	$	41,255	$	15,352	$	(1,343	)	$	510,897
Income from equity investment in ABG-Camuto	$	—	$	—	$	4,692	$	—	$	—		$	4,692
Six months ended August 4, 2018
Revenue:
Net sales	$	1,361,541	$	72,532	$	—	$	70,099	$	—		$	1,504,172
Commission, franchise and other revenue	—		—		—		—		3,198			3,198
Total revenue	$	1,361,541	$	72,532	$	—	$	70,099	$	3,198		$	1,507,370
Gross profit(1)	$	427,945	$	18,218	$	—	$	13,557	$	—		$	459,720

(1) Gross profit is defined as net sales, which excludes commission, franchise and other revenue, less cost of sales.

22

Item 2.     Management's Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Statement Regarding Forward-Looking Information for Purposes of the "Safe Harbor" Provisions of the Private Securities Litigation Reform Act of 1995

Certain statements in this Quarterly Report on Form 10-Q may constitute forward-looking statements which reflect our current views with respect to, among other things, future events and financial performance. Examples of such forward-looking statements include references to our future expansion and our acquisitions. You can identify these forward-looking statements by the use of forward-looking words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "would," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates," or the negative version of those words or other comparable words. Any forward-looking statements contained in this Quarterly Report on Form 10-Q are based upon current plans, estimates, expectations and assumptions relating to our operations, results of operations, financial condition, growth strategy and liquidity. The inclusion of this forward-looking information should not be regarded as a representation by us or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to numerous risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. In addition to those factors described under Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K filed on March 26, 2019, and Part II, Item 1A. Risk Factors in this Quarterly Report on Form 10-Q, some important factors that could cause actual results, performance or achievements to differ materially from those discussed in forward-looking statements include, but are not limited to, the following:

• our success in growing our store base and digital demand;

• our ability to successfully integrate the businesses acquired in fiscal 2018 or realize the anticipated benefits of the acquisitions after we complete our integration efforts;

• our ability to protect our reputation and to maintain the brands we license;

• maintaining strong relationships with our vendors, manufacturers and wholesale customers;

• our ability to anticipate and respond to fashion trends, consumer preferences and changing customer expectations;

• risks related to the loss or disruption of our distribution and/or fulfillment operations;

• continuation of agreements with and our reliance on the financial condition of Stein Mart;

• our ability to execute our strategies;

• fluctuation of our comparable sales and quarterly financial performance;

• risks related to the loss or disruption of our information systems and data;

• our ability to prevent or mitigate breaches of our information security and the compromise of sensitive and confidential data;

• failure to retain our key executives or attract qualified new personnel;

• our reliance on our loyalty programs and marketing to drive traffic, sales and customer loyalty;

• risks related to leases of our properties;

• our competitiveness with respect to style, price, brand availability and customer service;

• our reliance on foreign sources for merchandise and risks inherent to international trade;

• the imposition of new tariffs on our products;

• exposure to foreign tax contingencies;

• uncertainty related to future legislation, regulatory reform, policy changes, or interpretive guidance on existing legislation;

• uncertain general economic conditions;

• risks related to holdings of cash and investments and access to liquidity; and

• fluctuations in foreign currency exchange rates.

If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results, performance or achievements may vary materially from what we have projected. Furthermore, new factors emerge from time to time and it is not possible for management to predict all such factors, nor can management assess the impact of any such factor on the business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. Any forward-looking statement speaks only as of the date on which such statement is made, and, except as required by law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events.

23

Executive Overview

In the second quarter of fiscal 2019, we saw continued progress toward our previously disclosed strategies with reported sales and earnings that position us well to reaffirm our annual guidance. Our expectations have been exceeded with our newly acquired businesses. The Canada Retail segment delivered increased comparable sales and margin growth, benefiting from moving their digital offering to our platform used in the U.S. and the launch of new loyalty programs for our Canadian customers. The Brand Portfolio segment gives us the capability to design, source and market differentiated product for our customers and better position us to grow private label brands at DSW in the U.S. We remain on track to convert the production of our DSW private label to the Brand Portfolio segment in fiscal 2020. At that time, we expect to realize the benefits of having greater exclusivity in product offerings at higher margins.

In the U.S. Retail segment, we had continued positive results across our seasonal product categories, in particular sandals, and with our Kids line. We believe our efforts to increase the differentiation of our product offering, combined with the advantages of our strong loyalty base and our vast omni-channel capabilities, separate us from competitors, place us in a good position to mitigate any tariff headwinds and contribute to the achievement of our near and long-term goals.

Comparability

There are a number of items that affect comparability when reviewing our results of operations for the periods presented in this Quarterly Report on Form 10-Q. Significant items to consider include:

• On May 10, 2018, we acquired the remaining interest in TSL that we did not previously own. For the three and six months ended August 3, 2019 and for the three months ended August 4, 2018, TSL results were included in the condensed consolidated results of operations as a wholly-owned subsidiary. For the six months ended August 4, 2018, the loss from our equity investment interest in TSL for the first quarter of fiscal 2018 was included in our condensed consolidated results of operations. Due to the acquisition of the remaining interest in TSL during the second quarter of fiscal 2018, we remeasured to fair value our previously held assets, which included our equity investment in TSL and notes and accounts receivable from TSL. As a result of the remeasurement, we recorded a loss of $34.0 million to non-operating income (expenses), net. Also during the second quarter of fiscal 2018, we reclassified a net loss of $12.2 million of foreign currency translation related to the previously held balances from accumulated other comprehensive loss to non-operating income (expenses), net. In addition, with the TSL acquisition being accounted for as a step acquisition, the purchase price included the fair value of our previously held assets, which considered the valuation of the TSL enterprise. This valuation identified that the resulting goodwill was not supportable as the value of the acquired net assets exceeded the enterprise fair value. As a result, during the three months ended August 4, 2018, we recorded a goodwill impairment charge, which resulted in impairing all of TSL’s goodwill.

• On November 5, 2018, we completed the acquisition of Camuto Group. For the three and six months ended August 3, 2019, Camuto Group's results were included in the condensed consolidated results of operations as a wholly-owned subsidiary with no amounts included for the three and six months ended August 4, 2018.

• During the six months ended August 3, 2019, we incurred integration and restructuring costs related to our prior year acquisition activity, which consisted primarily of $3.6 million in severance, a $6.1 million termination fee for terminating two JVs, and $2.4 million of professional fees and other integration costs. During the six months ended August 4, 2018, we incurred restructuring costs of $2.7 million in severance, primarily related to changes in our store labor model.

• The six months ended August 4, 2018 included the wind-down operations of Ebuys during the first quarter of fiscal 2018, which included lease exit and other termination costs and incremental income tax expense.

Financial Summary

Total revenue increased to $860.2 million for the three months ended August 3, 2019 from $795.3 million for the three months ended August 4, 2018. The 8.2% increase in total revenue was primarily driven by incremental revenue from the acquired Camuto Group business, partially offset by the impact of stores closed since the end of the second quarter of fiscal 2018, primarily the Town Shoes banner stores, and a 0.6% decrease in comparable sales.

During the three months ended August 3, 2019, gross profit as a percentage of net sales was 30.0%, a decrease of 210 basis points from 32.1% in the previous year. The decrease in the gross profit rate was primarily driven by a benefit recognized in the second quarter of fiscal 2018 as a result of adjusting our loyalty programs deferred revenue due to the relaunch of the DSW VIP rewards program, the inclusion of Camuto Group, which operates at a lower gross profit rate, and higher shipping costs in the current year associated with higher digital penetration.

24

Net income for the three months ended August 3, 2019 was $27.4 million, or $0.37 per diluted share, which included net after-tax charges of $8.3 million, or $0.11 per diluted share, primarily related to integration and restructuring expenses associated with the businesses acquired in fiscal 2018. Net loss for the three months ended August 4, 2018 was $38.4 million, or $0.48 loss per diluted share, which included net after-tax charges of $89.3 million, or $1.11 per diluted share, primarily related to the acquisition of the Canadian retail business.

We have continued making investments in our business that support our long-term growth objectives. During the six months ended August 3, 2019, we invested $40.3 million in capital expenditures compared to $32.1 million during the six months ended August 4, 2018. Our capital expenditures during the first half of fiscal 2019 primarily related to six new store openings, multiple store remodels and investments in business infrastructure.

Results of Operations

Comparison of the Three Months Ended August 3, 2019 with the Three Months Ended August 4, 2018

	Three months ended
	August 3, 2019					August 4, 2018					Change
(dollars in thousands, except per share amounts)	Amount			% of Total Revenue		Amount			% of Total Revenue		Amount			%
Revenue:
Net sales	$	849,640		98.8	%	$	793,735		99.8	%	$	55,905		7.0	%
Commission, franchise and other revenue	10,558			1.2		1,533			0.2		9,025			588.7	%
Total revenue	860,198			100.0		795,268			100.0		64,930			8.2	%
Cost of sales	(594,779		)	(69.1	)	(539,240		)	(67.8	)	(55,539		)	10.3	%
Operating expenses	(226,616		)	(26.3	)	(195,319		)	(24.5	)	(31,297		)	16.0	%
Income from equity investment in ABG-Camuto	2,464			0.2		—			—		2,464			NM
Impairment charges	—			—		(36,240		)	(4.6	)	36,240			NM
Operating profit	41,267			4.8		24,469			3.1		16,798			68.7	%
Interest income (expense), net	(1,972		)	(0.2	)	805			0.1		(2,777		)	NM
Non-operating income (expenses), net	199			0.0		(47,349		)	(6.0	)	47,548			NM
Income (loss) before income taxes	39,494			4.6		(22,075		)	(2.8	)	61,569			NM
Income tax provision	(12,087		)	(1.4	)	(16,281		)	(2.0	)	4,194			(25.8	)%
Net income (loss)	$	27,407		3.2	%	$	(38,356	)	(4.8	)%	$	65,763		NM
Basic and diluted earnings (loss) per share:
Basic earnings (loss) per share	$	0.37				$	(0.48	)			$	0.85		NM
Diluted earnings (loss) per share	$	0.37				$	(0.48	)			$	0.85		NM
Weighted average shares used in per share calculations:
Basic shares	73,529					80,265					(6,736		)	(8.4	)%
Diluted shares	74,316					80,265					(5,949		)	(7.4	)%

NM - Not meaningful

25

Net Sales- The following summarizes the changes in consolidated net sales from the same period last year:

(in thousands)	Three months ended August 3, 2019
Consolidated net sales for the same period last year	$	793,735
Decrease in comparable sales(1)	(4,753		)
Net decrease from non-comparable sales and other changes	(2,124		)
Loss of net sales from closed stores	(16,152		)
Incremental external net sales from Camuto Group	78,934
Consolidated net sales	$	849,640

(1) A store is considered comparable when in operation for at least 14 months at the beginning of the fiscal year. Stores are added to the comparable base at the beginning of the year and are dropped for comparative purposes in the quarter they are closed. Comparable sales includes e-commerce sales. Stores in Canada from the TSL acquisition that were in operation for at least 14 months at the beginning of fiscal 2019, along with its e-commerce sales, were added to the comparable base beginning with the second quarter of fiscal 2019. Comparable sales for the Canada Retail segment exclude the impact of foreign currency translation and are calculated by translating current period results at the foreign currency exchange rate used in the comparable period in the prior year. The calculation of comparable sales varies across the retail industry and, as a result, the calculations of other retail companies may not be consistent with our calculation.

The following summarizes net sales by segment:

	Three months ended					Change
(dollars in thousands)	August 3, 2019			August 4, 2018		Amount			%		Comparable Sales %
Segment net sales:
U.S. Retail	$	677,920		$	691,757	$	(13,837	)	(2.0	)%	(1.5)%
Canada Retail	63,306			72,532		(9,226		)	(12.7	)%	8.1%
Brand Portfolio	95,422			—		95,422			NM		NA
Other	29,480			29,446		34			0.1	%	1.6%
	866,128			793,735		72,393			9.1	%
Elimination of intersegment net sales	(16,488		)	—		(16,488		)	NM
Consolidated net sales	$	849,640		$	793,735	$	55,905		7.0	%	(0.6)%

NM - Not meaningful

NA - Not applicable

Within the U.S. Retail segment, comparable sales decreased due to lower comparable transactions and a decline in comparable average dollar sales per transaction, primarily in the women's and men's categories partially offset by an increase in comparable sales in our seasonal categories and kids. Within the Canada Retail segment, comparable sales increased due to higher comparable average dollar sales per transaction, primarily as a result of the significant improvements to its digital platform and lower clearance inventory.

Commission, Franchise and Other Revenue- Commission, franchise and other revenue consists of commission income for First Cost design and buying services in the Brand Portfolio segment, royalties and other fees paid by franchisees, and rental income on owned and leased properties.

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Gross Profit- Gross profit is defined as net sales, which excludes commission, franchise and other revenue, less cost of sales, calculated as follows:

	Three months ended
	August 3, 2019					August 4, 2018					Change
(dollars in thousands)	Amount			% of Net Sales		Amount			% of Net Sales		Amount		%		Basis Points
Net sales	$	849,640		100.0	%	$	793,735		100.0	%
Cost of sales	(594,779		)	(70.0	)	(539,240		)	(67.9	)
Gross profit	$	254,861		30.0	%	$	254,495		32.1	%	$	366	0.1	%	(210	)

The following summarizes gross profit by segment:

	Three months ended
	August 3, 2019					August 4, 2018				Change
(dollars in thousands)	Amount			% of Segment Net Sales		Amount		% of Segment Net Sales		Amount			%		Basis Points
Segment gross profit:
U.S. Retail	$	208,056		30.7	%	$	229,601	33.2	%	$	(21,545	)	(9.4	)%	(250	)
Canada Retail	21,939			34.7	%	18,218		25.1	%	$	3,721		20.4	%	960
Brand Portfolio	19,261			20.2	%	—		—	%	$	19,261		NM		NM
Other	6,041			20.5	%	6,676		22.7	%	$	(635	)	(9.5	)%	(220	)
	255,297					254,495
Intercompany eliminations	(436		)			—
Consolidated gross profit	$	254,861				$	254,495

NM - Not meaningful

The U.S. Retail segment gross profit margin decreased primarily driven by a benefit recognized in the second quarter of fiscal 2018 as a result of adjusting our loyalty programs deferred revenue due to the relaunch of the DSW VIP rewards program, the deleverage of store occupancy and distribution and fulfillment expenses, and higher shipping costs in the current year associated with higher online orders. The Canada Retail segment gross profit margin improved due to lower clearance activity with improvements in the inventory position. The inclusion of Camuto Group, which operates at a lower gross profit rate, decreased the consolidated gross profit margin rate.

Operating Expenses- For the three months ended August 3, 2019, operating expenses as a percentage of total revenue increased 180 basis points over the same period last year primarily driven by the impact of including Camuto Group in the consolidated results and integration and restructuring costs.

Income from Equity Investment in ABG-Camuto- We account for our equity investment in ABG-Camuto using the equity method of accounting, with the net earnings attributable to our 40% investment being classified within operating profit. ABG-Camuto is an integral part of the Brand Portfolio segment, given the licensing agreement between us and ABG-Camuto, which allows us to sell licensed branded products to wholesale customers.

Impairment Charges- With the TSL acquisition being accounted for as a step acquisition, the purchase price included the fair value of our previously held assets, which considered the valuation of the TSL enterprise. This valuation identified that the resulting goodwill was not supportable as the value of the acquired net assets exceeded the enterprise fair value. As a result, during the three months ended August 4, 2018, we recorded a goodwill impairment charge, which resulted in impairing all of TSL’s goodwill.

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Non-operating Income (Expenses), net- Due to the acquisition of the remaining interest in TSL during the second quarter of fiscal 2018, we remeasured to fair value our previously held assets, which included our equity investment in TSL and notes and accounts receivable from TSL. As a result of the remeasurement, we recorded a loss of $34.0 million to non-operating income (expenses), net. Also during the second quarter of fiscal 2018, we reclassified a net loss of $12.2 million of foreign currency translation related to the previously held balances from accumulated other comprehensive loss to non-operating income (expenses), net.

Income Taxes- Our effective tax rate changed from a negative 73.8% for the three months ended August 4, 2018, reflecting a tax provision on net loss, to a positive 30.6% for the three months ended August 3, 2019. The effective tax rate was impacted by valuation allowances and the goodwill impairment associated with the TSL acquisition during the three months ended August 4, 2018.

Comparison of the Six Months Ended August 3, 2019 with the Six Months Ended August 4, 2018

	Six months ended
	August 3, 2019					August 4, 2018					Change
(dollars in thousands, except per share amounts)	Amount			% of Total Revenue		Amount			% of Total Revenue		Amount			%
Revenue:
Net sales	$	1,719,632		98.9	%	$	1,504,172		99.8	%	$	215,460		14.3	%
Commission, franchise and other revenue	19,081			1.1		3,198			0.2		15,883			496.7	%
Total revenue	1,738,713			100.0		1,507,370			100.0		231,343			15.3	%
Cost of sales	(1,208,735		)	(69.5	)	(1,044,452		)	(69.3	)	(164,283		)	15.7	%
Operating expenses	(449,422		)	(25.8	)	(363,739		)	(24.1	)	(85,683		)	23.6	%
Income from equity investment in ABG-Camuto	4,692			0.2		—			—		4,692			NM
Impairment charges	—			—		(36,240		)	(2.4	)	36,240			NM
Operating profit	85,248			4.9		62,939			4.2		22,309			35.4	%
Interest income (expense), net	(3,773		)	(0.2	)	1,469			0.1		(5,242		)	NM
Non-operating expenses, net	(143		)	0.0		(49,486		)	(3.3	)	49,343			(99.7	)%
Income before income taxes and loss from equity investment in TSL	81,332			4.7		14,922			1.0		66,410			445.0	%
Income tax provision	(22,731		)	(1.3	)	(27,671		)	(1.8	)	4,940			(17.9	)%
Loss from equity investment in TSL	—			—		(1,310		)	(0.1	)	1,310			NM
Net income (loss)	$	58,601		3.4	%	$	(14,059	)	(0.9	)%	$	72,660		NM
Basic and diluted earnings (loss) per share:
Basic earnings (loss) per share	$	0.78				$	(0.18	)			$	0.96		NM
Diluted earnings (loss) per share	$	0.77				$	(0.18	)			$	0.95		NM
Weighted average shares used in per share calculations:
Basic shares	75,267					80,187					(4,920		)	(6.1	)%
Diluted shares	76,281					80,187					(3,906		)	(4.9	)%

NM - Not meaningful

Net Sales- The following summarizes the changes in consolidated net sales from the same period last year:

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(in thousands)	Six months ended August 3, 2019
Consolidated net sales for the same period last year	$	1,504,172
Increase in comparable sales	16,127
Net increase from non-comparable sales and other changes	3,021
Loss of net sales from closed stores	(19,535		)
Incremental external net sales from 2018 acquired businesses	221,479
Loss of net sales from the exit of Ebuys	(5,632		)
Consolidated net sales	$	1,719,632

The following summarizes net sales by segment:

	Six months ended					Change
(dollars in thousands)	August 3, 2019			August 4, 2018		Amount			%		Comparable Sales %
Segment net sales:
U.S. Retail	$	1,369,760		$	1,361,541	$	8,219		0.6	%	0.7%
Canada Retail	115,122			72,532		42,590			58.7	%	8.1%
Brand Portfolio	196,289			—		196,289			NM		NA
Other	65,087			70,099		(5,012		)	(7.1	)%	2.5%
	1,746,258			1,504,172		242,086			16.1	%
Elimination of intersegment net sales	(26,626		)	—		(26,626		)	NM
Consolidated net sales	$	1,719,632		$	1,504,172	$	215,460		14.3	%	1.1%

NM - Not meaningful

NA - Not applicable

Within the U.S. Retail segment, comparable sales increased due to higher comparable transactions partially offset by a decline in comparable average dollar sales per transaction. The comparable sales for the Canada Retail segment reflect the stores that were added to the comparable base beginning with the second quarter of fiscal 2019.

Commission, Franchise and Other Revenue- Commission, franchise and other revenue consists of commission income for First Cost design and buying services in the Brand Portfolio segment, royalties and other fees paid by franchisees, and rental income on owned and leased properties.

Gross Profit- Gross profit is defined as net sales, which excludes commission, franchise and other revenue, less cost of sales, calculated as follows:

	Six months ended
	August 3, 2019					August 4, 2018					Change
(dollars in thousands)	Amount			% of Net Sales		Amount			% of Net Sales		Amount		%		Basis Points
Net sales	$	1,719,632		100.0	%	$	1,504,172		100.0	%
Cost of sales	(1,208,735		)	(70.3	)	(1,044,452		)	(69.4	)
Gross profit	$	510,897		29.7	%	$	459,720		30.6	%	$	51,177	11.1	%	(90	)

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The following summarizes gross profit by segment:

	Six months ended
	August 3, 2019					August 4, 2018				Change
(dollars in thousands)	Amount			% of Segment Net Sales		Amount		% of Segment Net Sales		Amount			%		Basis Points
Segment gross profit:
U.S. Retail	$	417,947		30.5	%	$	427,945	31.4	%	$	(9,998	)	(2.3	)%	(90	)
Canada Retail	37,686			32.7	%	18,218		25.1	%	$	19,468		106.9	%	760
Brand Portfolio	41,255			21.0	%	—		—	%	$	41,255		NM		NM
Other	15,352			23.6	%	13,557		19.3	%	$	1,795		13.2	%	430
	512,240					459,720
Intercompany eliminations	(1,343		)			—
Consolidated gross profit	$	510,897				$	459,720

NM - Not meaningful

The U.S. Retail segment gross profit margin declined primarily driven by a benefit recognized in the second quarter of fiscal 2018 as a result of adjusting our loyalty programs deferred revenue due to the relaunch of the DSW VIP rewards program and higher shipping costs in the current year associated with higher digital penetration, partially offset by higher initial markups and lower markdowns. The Canada Retail segment gross profit margin improved due to lower clearance activity. The inclusion of Camuto Group, which operates at a lower gross profit rate, decreased the consolidated gross profit margin rate.

Operating Expenses- For the six months ended August 3, 2019, operating expenses as a percentage of total revenue increased 170 basis points over the same period last year primarily driven by the impact of the acquired businesses, integration and restructuring costs and the change in accounting for previously exited leased space as a result of the transition to ASU 2016-02, partially offset by the exit of Ebuys during the previous year.

Income from Equity Investment in ABG-Camuto- We account for our equity investment in ABG-Camuto using the equity method of accounting, with the net earnings attributable to our 40% investment being classified within operating profit. ABG-Camuto is an integral part of the Brand Portfolio segment, given the licensing agreement between us and ABG-Camuto, which allows us to sell licensed branded products to wholesale customers.

Impairment Charges- With the TSL acquisition being accounted for as a step acquisition, the purchase price included the fair value of our previously held assets, which considered the valuation of the TSL enterprise. This valuation identified that the resulting goodwill was not supportable as the value of the acquired net assets exceeded the enterprise fair value. As a result, during the six months ended August 4, 2018, we recorded a goodwill impairment charge, which resulted in impairing all of TSL’s goodwill.

Non-operating Expenses, net- Due to the acquisition of the remaining interest in TSL during the second quarter of fiscal 2018, we remeasured to fair value our previously held assets, which included our equity investment in TSL and notes and accounts receivable from TSL. As a result of the remeasurement, we recorded a loss of $34.0 million to non-operating income (expenses), net. Also during the second quarter of fiscal 2018, we reclassified a net loss of $12.2 million of foreign currency translation related to the previously held balances from accumulated other comprehensive loss to non-operating income (expenses), net.

Income Taxes- Our effective tax rate changed from 203.3% for the six months ended August 4, 2018 to 27.9% for the six months ended August 3, 2019. The decrease in the effective tax rate was primarily driven by valuation allowances and the goodwill impairment associated with the TSL acquisition during the six months ended August 4, 2018.

Seasonality

Our business is subject to seasonal merchandise trends driven by the change in weather conditions and our customers' interest in new seasonal styles. New spring styles are primarily introduced in the first quarter and new fall styles are primarily introduced in the third quarter.

Liquidity and Capital Resources

Overview

Our primary ongoing operating cash flow requirements are for inventory purchases, capital expenditures for new stores, improving our information technology systems and infrastructure growth. Our working capital and inventory levels fluctuate seasonally.

During the six months ended August 3, 2019, we repurchased 6.1 million Class A common shares at a cost of $125.0 million, which was partially funded with borrowings on the revolving line of credit, with $351.6 million of Class A common shares that remain authorized under the program as of August 3, 2019. During the six months ended August 4, 2018, we did not repurchase any Class A common shares. The share repurchase program may be suspended, modified or discontinued at any time, and we have no obligation to repurchase any amount of our common shares under the program. Shares will be repurchased in the open market at times and in amounts considered appropriate based on price and market conditions.

We are committed to a cash management strategy that maintains liquidity to adequately support the operation of the business, pursue our growth strategy and withstand unanticipated business volatility. We believe that cash generated from our operations, together with our current levels of cash and investments, as well as availability under our Credit Facility, are sufficient over the next 12 months and the foreseeable future to maintain our ongoing operations, support seasonal working capital requirements, fund capital expenditures, and repurchase common shares under our share repurchase program.

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Operating Cash Flows

For the six months ended August 3, 2019, net cash provided by operations was $34.2 million compared to $106.6 million for the six months ended August 4, 2018. The change was driven by a decrease in net income after adjusting for non-cash activity, including depreciation and amortization, stock-based compensation, impairment charges, the loss on previously held assets in TSL, loss on foreign currency reclassified from accumulated other comprehensive loss, the change in deferred income taxes, and lease exit charges, primarily due to including the net loss from Camuto Group during the first half of fiscal 2019. In addition, we had an increased use of cash to fund working capital requirements during the first quarter of fiscal 2019 due to the addition of the acquired businesses, which uses cash for working capital requirements in the first half of the year consistent with our U.S. retail operations.

Investing Cash Flows

For the six months ended August 3, 2019, our net cash provided by investing activities was $4.5 million, which was due to proceeds from the sale of available-for sale-securities exceeding capital expenditures of $40.3 million. During the six months ended August 4, 2018, our net cash used in investing activities was $25.7 million, which was due to the acquisition of TSL, capital expenditures of $32.1 million and $16.0 million of additional borrowings by TSL prior to the acquisition, partially offset by the net liquidation of our available-for sale-securities.

Financing Cash Flows

For the six months ended August 3, 2019, our net cash used in financing activities was $87.2 million compared to $41.1 million for the six months ended August 4, 2018. Net cash used in financing activities was primarily related to the payment of dividends. The repurchase of Class A common shares under the share repurchase program during six months ended August 3, 2019 was partially financed using our revolving line of credit.

Debt

Credit Facility- On August 25, 2017, we entered into a senior unsecured revolving credit agreement (the "Credit Facility") with a maturity date of August 25, 2022 that replaced our previous secured revolving credit agreement and letter of credit agreement. On October 10, 2018, the Credit Facility was amended to include the acquisition of Camuto Group as a permitted acquisition and, following the acquisition, to utilize an accordion feature that provided for an increase to the revolving line of credit. On November 5, 2018, following the acquisition of Camuto Group, the amended Credit Facility was increased with no change to the sub-limits. As of August 3, 2019, the Credit Facility provided a revolving line of credit up to $400 million, with sub-limits for the issuance of up to $50 million in letters of credit, swing loan advances of up to $15 million, and the issuance of up to $75 million in foreign currency revolving loans and letters of credit. The Credit Facility may be used to provide funds for working capital, capital expenditures, share repurchases, other expenditures, and permitted acquisitions as defined by the Credit Facility. Our Credit Facility allows the payments of dividends by us or our subsidiaries, provided that immediately before and after a dividend payment there is no event of default, as defined in our Credit Facility.

Loans issued under the revolving line of credit bear interest, at our option, at a base rate or an alternate base rate as defined in the Credit Facility plus a margin based on our leverage ratio, with an interest rate of 4.1% as of August 3, 2019. Any loans issued in CAD bear interest at the alternate base rate plus a margin based on our leverage ratio. Interest on letters of credit issued under the Credit Facility is variable based on our leverage ratio and the type of letters of credit, with an interest rate of 1.7% as of August 3, 2019. Commitment fees are based on the average unused portion of the Credit Facility at a variable rate based on our leverage ratio. As of August 3, 2019, we had $235.0 million outstanding under the Credit Facility and $1.3 million in letters of credit issued, resulting in $163.7 million available for borrowings. Interest expense related to the Credit Facility includes interest on borrowings and letters of credit, commitment fees and the amortization of debt issuance costs.

Debt Covenants- The Credit Facility contains financial and other covenants, including, but not limited to, limitations on indebtedness, liens and investments, as well as the maintenance of a leverage ratio not to exceed 3.25:1 and a fixed charge coverage ratio not to be less than 1.75:1. As a result of the acquisition of Camuto Group, we have elected to increase the leverage ratio whereby we must maintain a leverage ratio not to exceed 3.50:1 as of the end of the fourth quarter of fiscal 2018 and for the subsequent three quarters. A violation of any of the covenants could result in a default under the Credit Facility that would permit the lenders to restrict our ability to further access the Credit Facility for loans and letters of credit and require the immediate repayment of any outstanding loans under the Credit Facility. As of August 3, 2019, we were in compliance with all financial covenants.

31

Capital Expenditure Plans

We expect to spend approximately $75.0 million to $85.0 million for capital expenditures in fiscal 2019. Our future investments will depend primarily on the number of stores we open and remodel, infrastructure and information technology projects that we undertake and the timing of these expenditures. During fiscal 2019, we plan to open approximately 17 to 21 new stores.

Off-Balance Sheet Liabilities and Other Contractual Obligations

We do not have any material off-balance sheet arrangements as defined by Item 303(a)(4) of Regulation S-K.

We have included a summary of our contractual obligations as of February 2, 2019 in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019. There have been no material changes in contractual obligations outside the ordinary course of business since February 2, 2019.

Critical Accounting Policies and Estimates

The preparation of our condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and disclosure of commitments and contingencies at the date of the condensed consolidated financial statements and reported amounts of revenue and expenses during the reporting period. We base these estimates and judgments on factors we believe to be relevant, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The process of determining significant estimates is fact-specific and takes into account factors such as historical experience, current and expected economic conditions, product mix, and in some cases, actuarial and appraisal techniques. We constantly re-evaluate these significant factors and make adjustments where facts and circumstances dictate.

While we believe that the factors considered provide a meaningful basis for the accounting policies applied in the preparation

of the condensed consolidated financial statements, we cannot guarantee that our estimates and assumptions will be accurate. As the determination of these estimates requires the exercise of judgment, actual results may differ from those estimates, and such differences may be material to our condensed consolidated financial statements. There have been no material changes to the application of critical accounting policies disclosed in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019.

Item 3.    Quantitative and Qualitative Disclosures About Market Risk

We have market risk exposure related to interest rates and foreign currency exchange rates. Market risk is measured as the potential negative impact on earnings, cash flows or fair values resulting from a hypothetical change in interest rates or foreign currency exchange rates over the next year. We currently do not utilize hedging instruments to mitigate these market risks.

Interest Rate Risk

We hold available-for-sale securities, which are not materially affected by changes in market interest rates. Also, as of August 3, 2019, we had $235.0 million outstanding on our revolving line of credit under our Credit Facility. Borrowings under our Credit Facility are based on a variable rate of interest, which exposes us to interest rate market risks, particularly during a period of rising interest rates. The impact of a hypothetical 100 basis point increase in interest rates on our revolving line of credit would not result in a material amount of additional expense over a 12-month period based on the balance as of August 3, 2019.

Foreign Currency Exchange Risk

We are exposed to the impact of foreign exchange rate risk primarily through our operations in Canada, where the functional currency is the Canadian dollar, as well as foreign denominated cash accounts. A hypothetical 10% movement in the exchange rates could result in a $3.0 million foreign currency translation fluctuation, which would be recorded in accumulated other comprehensive loss within the condensed consolidated balance sheets, and $2.1 million of foreign currency revaluation, which would be recorded in non-operating income (expenses), net within the condensed consolidated statements of operations.

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Item 4.     Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We, under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, performed an evaluation of our disclosure controls and procedures, as such term is defined in Exchange Act Rules 13a-15(e) and 15d-15(e). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded, as of the end of the period covered by this report, that such disclosure controls and procedures were effective.

Changes in Internal Control Over Financial Reporting

No change was made in our internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d -15(e), during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II.    OTHER INFORMATION

Item 1.    Legal Proceedings

The information set forth in Note 16, Commitments and Contingencies - Legal Proceedings, of the condensed consolidated financial statements of this Quarterly Report on Form 10-Q is incorporated herein by reference.

Item 1A.     Risk Factors

The following risk factors supplement and update our risk factors as set forth in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the fiscal year ended February 2, 2019.

The imposition of new tariffs on our products could have a material adverse effect on our business and financial performance.

The U.S. Government has placed tariffs on certain goods imported from China and may impose new tariffs on goods imported from China and other countries, including footwear and other products that we import. All of the Brand Portfolio segment products are manufactured from third-party manufacturing facilities outside the U.S., whereas our retail merchandise is purchased from both domestic and foreign vendors. Many of our domestic vendors import a large portion of their merchandise from abroad. We believe almost all of our merchandise was manufactured outside the U.S., with the majority manufactured in China. In retaliation, China has responded by imposing tariffs on a wide range of products imported from the U.S. and by adjusting the value of its currency. If additional tariffs or trade restrictions are implemented by the U.S. or other countries in connection with a global trade war, the resulting escalation of trade tensions could have a material adverse effect on world trade and the global economy. While it is too early to predict whether or how the recently enacted tariffs will impact our business, the imposition of tariffs on footwear or other items imported by us from China could require us to increase prices to our customers or, if unable to do so, result in lowering our gross margin on products sold, which could have a material adverse effect on our business and financial performance. Alternatively, we may seek to shift production outside of China, resulting in significant costs and disruption to our business. Even in the absence of further tariffs or trade restrictions, the related uncertainty and the market's fear of an economic slowdown could lead to a decrease in consumer spending and we may experience lower net sales than expected. Reduced net sales may result in reduced operating cash flows if we are not able to appropriately manage inventory levels or leverage expenses.

We are exposed to foreign tax contingencies as a result of the acquisition of Camuto Group, which could have a material adverse effect on our financial performance.

During the due diligence procedures performed related to the acquisition of Camuto Group, we identified probable contingent liabilities associated with unpaid foreign payroll and other taxes that could also result in assessed penalties and interest. We have developed an estimate of the range of outcomes related to these obligations of $14.8 million to $30.0 million for obligations we are aware of at this time. We are continuing to assess the exposure, which may result in material changes to these estimates, and we may identify additional contingent liabilities. We believe that the Sellers are obligated to indemnify us for any payments to foreign taxing authorities for the periods up to the acquisition date. Although a portion of the purchase price is held in escrow and another portion is held in a restricted bank account, there can be no assurance that we will successfully collect all amounts that we may be obligated to settle with the foreign taxing authorities.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Share Repurchase Program

On August 17, 2017, the Board of Directors authorized the repurchase of an additional $500 million of Class A common shares under our share repurchase program, which was added to the $33.5 million remaining from the previous authorization. The share repurchase program may be suspended, modified or discontinued at any time, and we have no obligation to repurchase any amount of our common shares under the program. Shares will be repurchased in the open market at times and in amounts considered appropriate based on price and market conditions.

The following table sets forth the Class A common share repurchases during the most recent quarter:

(in thousands, except per share amounts)	(a) Total Number of Shares Purchased	(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Programs	(d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Programs
May 5, 2019 to June 1, 2019	—	$	—	—	$	401,564
June 2, 2019 to July 6, 2019(1)	2,669	$	18.74	2,668	$	351,564
July 7, 2019 to August 3, 2019	—	$	—	—	$	351,564
Total	2,669	$	18.74	2,668

(1) The total number of shares repurchased includes the shares repurchased as part of publicly announced programs (the average price paid per share includes any broker commissions) and 856 shares withheld in connection with tax payments due upon vesting of employee restricted stock awards.

Dividends

The payment of any future dividends is at the discretion of our Board of Directors and is based on our future earnings, cash flow, financial condition, capital requirements, changes in taxation laws, general economic condition and any other relevant factors. It is anticipated that dividends will be declared on a quarterly basis. Our Credit Facility allows the payments of dividends by us or our subsidiaries, provided that immediately before and after a dividend payment there is no event of default, as defined in our Credit Facility. On August 29, 2019, the Board of Directors declared a quarterly cash dividend payment of $0.25 per share for both Class A and Class B common shares. The dividend will be paid on October 4, 2019 to shareholders of record at the close of business on September 20, 2019.

Item 3.    Defaults Upon Senior Securities

None.

Item 4.    Mine Safety Disclosures

Not Applicable.

Item 5.    Other Information

None.

34

Item 6.    Exhibits

Exhibit No.	Description
3.1	Amended and Restated Articles of Incorporation, dated March 19, 2019. Incorporated by reference to Exhibit 3.1 to Form 10-K (file no. 001-32545) filed March 26, 2019.
3.2	Amended and Restated Code of Regulations. Incorporated by reference to Exhibit 3.2 to Form 10-K (file no. 001-32545) filed April 13, 2006.
4.1	Specimen Class A Common Shares Certificate. Incorporated by reference to Exhibit 4.1 to Form 10-Q (file no. 001-32545) filed June 4, 2019.
31.1*	Rule 13a-14(a)/15d-14(a) Certification - Principal Executive Officer.
31.2*	Rule 13a-14(a)/15d-14(a) Certification - Principal Financial Officer.
32.1*	Section 1350 Certification - Principal Executive Officer.
32.2*	Section 1350 Certification - Principal Financial Officer.
101*	The following materials from the Designer Brands Inc. Quarterly Report on Form 10-Q for the quarter ended August 3, 2019, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Condensed Consolidated Statements of Operations for the three and six months ended August 3, 2019 and August 4, 2018; (ii) Condensed Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended August 3, 2019 and August 4, 2018; (iii) Condensed Consolidated Balance Sheets as of August 3, 2019, February 2, 2019 and August 4, 2018; (iv) Condensed Consolidated Statements of Shareholders’ Equity for the three and six months ended August 3, 2019 and August 4, 2018; (v) Condensed Consolidated Statements of Cash Flows for the six months ended August 3, 2019 and August 4, 2018; and (vi) Notes to Condensed Consolidated Financial Statements.
104*	Cover Page Interactive Data File, formatted in iXBRL and contained in Exhibit 101.

* Filed herewith

35

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

DESIGNER BRANDS INC.

Date:	August 30, 2019	By:	/s/ Jared Poff
			Jared Poff
			Executive Vice President and Chief Financial Officer
			(Principal Financial Officer and duly authorized officer)

36

EX-31.1

EXHIBIT 31.1

CERTIFICATIONS

I, Roger Rawlins, certify that:

1.      I have reviewed this quarterly report on Form 10-Q of Designer Brands Inc.;

2.      Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.      Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.      The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.      The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)     Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

August 30, 2019	By:	/s/ Roger Rawlins
		Roger Rawlins
		Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATIONS

I, Jared Poff, certify that:

1.      I have reviewed this quarterly report on Form 10-Q of Designer Brands Inc.;

2.      Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.      Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.      The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.      The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)     Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

August 30, 2019	By:	/s/ Jared Poff
		Jared Poff
		Executive Vice President and Chief Financial Officer

EX-32.1

EXHIBIT 32.1

SECTION 1350 CERTIFICATION*

In connection with the Quarterly Report of Designer Brands Inc. (the "Company") on Form 10-Q for the period ended August 3, 2019 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Roger Rawlins, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

August 30, 2019	By:	/s/ Roger Rawlins
		Roger Rawlins
		Chief Executive Officer

* This Certification is being furnished as required by Rule 13a-14(b) under the Securities Exchange Act of 1934 (the "Exchange Act") and Section 1350 of Chapter 63 of Title 18 of the United States Code, and shall not be deemed "filed" for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that section. This Certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except as otherwise stated in such filing.

A signed original of this written statement required by 18 U.S.C. § 1350 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

EXHIBIT 32.2

SECTION 1350 CERTIFICATION*

In connection with the Quarterly Report of Designer Brands Inc. (the "Company") on Form 10-Q for the period ended August 3, 2019 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Jared Poff, Executive Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

August 30, 2019	By:	/s/ Jared Poff
		Jared Poff
		Executive Vice President and Chief Financial Officer

* This Certification is being furnished as required by Rule 13a-14(b) under the Securities Exchange Act of 1934 (the "Exchange Act") and Section 1350 of Chapter 63 of Title 18 of the United States Code, and shall not be deemed "filed" for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that section. This Certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except as otherwise stated in such filing.

A signed original of this written statement required by 18 U.S.C. § 1350 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document and Entity Information - shares	6 Months Ended
	Aug. 03, 2019	Aug. 23, 2019
Class of Stock [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Aug. 03, 2019
Document Transition Report	false
Entity File Number	1-32545
Entity Registrant Name	DESIGNER BRANDS INC.
Entity Incorporation, State or Country Code	OH
Entity Tax Identification Number	31-0746639
Entity Address, Address Line One	810 DSW Drive,
Entity Address, City or Town	Columbus,
Entity Address, State or Province	OH
Entity Address, Postal Zip Code	43219
City Area Code	614
Local Phone Number	237-7100
Title of 12(b) Security	Class A Common Shares, without par value
Trading Symbol	DBI
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Shell Company	false
Entity Central Index Key	0001319947
Current Fiscal Year End Date	--02-01
Entity Emerging Growth Company	false
Entity Small Business	false
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q2
Amendment Flag	false
Class A common shares
Class of Stock [Line Items]
Entity Common Stock, Shares Outstanding		64,911,631
Class B common shares
Class of Stock [Line Items]
Entity Common Stock, Shares Outstanding		7,732,786

XML

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Aug. 03, 2019	Aug. 04, 2018
Net sales	$ 860,198	$ 795,268	$ 1,738,713	$ 1,507,370
Operating expenses	(226,616)	(195,319)	(449,422)	(363,739)
Income (loss) from equity investments			4,692	(1,310)
Impairment charges	0	(36,240)	0	(36,240)
Operating profit	41,267	24,469	85,248	62,939
Interest income (expense), net	(1,972)	805	(3,773)	1,469
Non-operating income (expenses), net	199	(47,349)	(143)	(49,486)
Income (loss) before income taxes and loss from equity investment in TSL	39,494	(22,075)	81,332	14,922
Income tax provision	(12,087)	(16,281)	(22,731)	(27,671)
Net income (loss)	$ 27,407	$ (38,356)	$ 58,601	$ (14,059)
Basic and diluted earnings (loss) per share:
Basic earnings per share (USD per share)	$ 0.37	$ (0.48)	$ 0.78	$ (0.18)
Diluted earnings per share (USD per share)	$ 0.37	$ (0.48)	$ 0.77	$ (0.18)
Weighted average shares used in per share calculations:
Basic shares (in shares)	73,529	80,265	75,267	80,187
Diluted shares (in shares)	74,316	80,265	76,281	80,187
Product
Net sales	$ 849,640	$ 793,735	$ 1,719,632	$ 1,504,172
Cost of sales	(594,779)	(539,240)	(1,208,735)	(1,044,452)
Commission, franchise and other revenue
Net sales	10,558	1,533	19,081	3,198
ABG-Camuto, LLC
Income (loss) from equity investments	2,464	0	4,692	0
TSL
Income (loss) from equity investments	$ 0	$ 0	$ 0	$ (1,310)

XML

Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Aug. 03, 2019	Aug. 04, 2018
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 27,407	$ (38,356)	$ 58,601	$ (14,059)
Other comprehensive income (loss), net of income taxes:
Foreign currency translation gain (loss)	461	(1,365)	(253)	(6,050)
Unrealized net gain (loss) on debt securities	196	27	438	(317)
Reclassification adjustment for net losses (gains) realized in net income (loss)	23	12,260	(65)	14,165
Total other comprehensive income, net of income taxes	680	10,922	120	7,798
Total comprehensive income (loss)	$ 28,087	$ (27,434)	$ 58,721	$ (6,261)

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Aug. 03, 2019	Feb. 02, 2019	Aug. 04, 2018
ASSETS
Cash and cash equivalents	$ 51,762	$ 99,369	$ 215,996
Investments	25,504	69,718	73,119
Accounts receivable, net	85,162	68,870	17,259
Inventories	706,168	645,317	596,956
Prepaid expenses and other current assets	55,561	71,945	73,763
Total current assets	924,157	955,219	977,093
Property and equipment, net	402,779	409,576	387,621
Operating lease assets	975,963	0	0
Goodwill	116,280	89,513	25,899
Intangible assets	21,112	46,129	20,285
Deferred tax assets	29,515	30,283	14,235
Equity investment in ABG-Camuto	55,033	58,125	0
Other assets	32,407	31,739	19,883
Total assets	2,557,246	1,620,584	1,445,016
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable	289,457	261,625	229,440
Accrued expenses	173,437	201,535	145,776
Less current operating lease liabilities	185,969	0	0
Total current liabilities	648,863	463,160	375,216
Long-term Debt	235,000	160,000	0
Non-current operating lease liabilities	905,546	0	0
Other non-current liabilities	38,590	165,047	150,316
Total liabilities	1,827,999	788,207	525,532
Commitments and contingencies
Shareholders' equity:
Common shares paid-in capital, no par value	988,305	978,794	971,653
Treasury shares, at cost	(498,436)	(373,436)	(325,906)
Retained earnings	266,957	254,718	301,006
Basis difference related to acquisition of commonly controlled entity	(24,993)	(24,993)	(24,993)
Accumulated other comprehensive loss	(2,586)	(2,706)	(2,276)
Total shareholders' equity	729,247	832,377	919,484
Total liabilities and shareholders' equity	$ 2,557,246	$ 1,620,584	$ 1,445,016

XML

Condensed Consolidated Statements of Shareholders' Equity Statement - USD ($) shares in Thousands, $ in Thousands	Total	Class A common shares	Class B common shares	Treasury shares	Common shares paid in capital	Retained earnings	Treasury shares	Basis difference related to acquisition of commonly controlled entity	Accumulated other comprehensive loss
Balance (in shares) at Feb. 03, 2018		72,294	7,733	13,091
Balance at Feb. 03, 2018	$ 955,251				$ 961,245	$ 354,979	$ (325,906)	$ (24,993)	$ (10,074)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	$ (14,059)					(14,059)
Stock-based compensation activity (in shares)	267
Stock-based compensation activity	$ 10,408				10,408
Dividends	(39,914)					(39,914)
Other comprehensive income	7,798								7,798
Balance (in shares) at Aug. 04, 2018		72,561	7,733	13,091
Balance at Aug. 04, 2018	919,484				971,653	301,006	(325,906)	(24,993)	(2,276)
Balance (in shares) at May. 05, 2018		72,470	7,733	13,091
Balance at May. 05, 2018	960,868				965,623	359,342	(325,906)	(24,993)	(13,198)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	$ (38,356)					(38,356)
Stock-based compensation activity (in shares)	91
Stock-based compensation activity	$ 6,030				6,030
Dividends	(19,980)					(19,980)
Other comprehensive income	10,922								10,922
Balance (in shares) at Aug. 04, 2018		72,561	7,733	13,091
Balance at Aug. 04, 2018	919,484				971,653	301,006	(325,906)	(24,993)	(2,276)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cumulative effect of accounting change	(9,556)					(9,556)
Balance (in shares) at Feb. 02, 2019		70,672	7,733	15,091
Balance at Feb. 02, 2019	832,377				978,794	254,718	(373,436)	(24,993)	(2,706)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	$ 58,601					58,601
Stock-based compensation activity (in shares)	317
Stock-based compensation activity	$ 9,511				9,511
Repurchase of Class A common shares (in shares)	(6,100)	(6,078)
Repurchase of Class A common shares (in shares)				6,078
Repurchase of Class A common shares	$ (125,000)						(125,000)
Dividends	(36,806)					(36,806)
Other comprehensive income	120								120
Balance (in shares) at Aug. 03, 2019		64,911	7,733	21,169
Balance at Aug. 03, 2019	729,247				988,305	266,957	(498,436)	(24,993)	(2,586)
Balance (in shares) at May. 04, 2019		67,434	7,733	18,501
Balance at May. 04, 2019	762,851				982,093	257,453	(448,436)	(24,993)	(3,266)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	$ 27,407					27,407
Stock-based compensation activity (in shares)	145
Stock-based compensation activity	$ 6,212				6,212
Repurchase of Class A common shares (in shares)		(2,668)
Repurchase of Class A common shares (in shares)				2,668
Repurchase of Class A common shares	(50,000)						(50,000)
Dividends	(17,903)					(17,903)
Other comprehensive income	680								680
Balance (in shares) at Aug. 03, 2019		64,911	7,733	21,169
Balance at Aug. 03, 2019	$ 729,247				$ 988,305	$ 266,957	$ (498,436)	$ (24,993)	$ (2,586)

XML

Condensed Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares	3 Months Ended		6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Aug. 03, 2019	Aug. 04, 2018
Statement of Stockholders' Equity [Abstract]
Dividends (USD per share)	$ 0.25	$ 0.25	$ 0.50	$ 0.50

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018
Cash flows from operating activities:
Net income (loss)	$ 58,601	$ (14,059)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	42,485	38,429
Stock-based compensation expense	9,731	9,698
Deferred income taxes	1,043	13,526
Loss (income) from equity investments	(4,692)	1,310
Loss on previously held equity investment in TSL and notes receivable from TSL	0	33,988
Impairment charges	0	36,240
Lease exit non-cash charges	0	3,910
Loss on foreign currency reclassified from accumulated other comprehensive loss	0	13,963
Other	538	8,106
Change in operating assets and liabilities, net of acquired amounts:
Accounts receivable	(14,800)	3,767
Inventories	(61,748)	(37,308)
Prepaid expenses and other current assets	(2,972)	(23,257)
Accounts payable	30,683	26,219
Accrued expenses	(24,677)	(7,960)
Net cash provided by operating activities	34,192	106,572
Cash flows from investing activities:
Cash paid for property and equipment	(40,259)	(32,103)
Purchases of available-for-sale investments	(3,014)	(16,735)
Sales of available-for-sale investments	47,764	67,280
Additional borrowings by TSL	0	(15,989)
Business acquisitions, net of cash acquired	0	(28,152)
Net cash provided by (used in) investing activities	4,491	(25,699)
Cash flows from financing activities:
Borrowing on revolving line of credit	320,700	0
Payments on revolving line of credit	(245,700)	0
Cash paid for treasury shares	(125,000)	0
Dividends paid	(36,806)	(39,910)
Other	(397)	(1,199)
Net cash used in financing activities	(87,203)	(41,109)
Effect of exchange rate changes on cash balances	(286)	300
Net increase (decrease) in cash, cash equivalents, and restricted cash	(48,806)	40,064
Cash, cash equivalents, and restricted cash, beginning of period	100,568	175,932
Cash and cash equivalents, end of period	51,762	215,996
Supplemental disclosures of cash flow information:
Cash paid for income taxes	21,796	28,135
Cash paid for interest on debt	4,052	0
Cash paid for operating lease liabilities	118,563	0
Non-cash investing and financing activities:
Property and equipment purchases not yet paid	8,648	8,390
Operating lease liabilities arising from lease asset additions (excluding ASU 2016-02 transition adjustments)	9,184	0
Adjustment to operating lease assets and lease liabilities for modifications	$ 48,029	$ 0

XML

Significant Accounting Policies

6 Months Ended

Aug. 03, 2019

Accounting Policies [Abstract]

Significant Accounting Policies

SIGNIFICANT ACCOUNTING POLICIES

Business Operations- Designer Brands Inc. is a leading North American footwear and accessories designer, producer and retailer.

On May 10, 2018, we acquired the remaining interest in Town Shoes Limited ("TSL") that we did not previously own. Beginning with our second quarter of fiscal 2018, TSL ceased being accounted for under the equity method of accounting and was accounted for as a consolidated wholly-owned subsidiary. As a result of this acquisition, we operate a Canadian business that is a retailer of branded footwear under The Shoe Company, Shoe Warehouse, and DSW Designer Shoe Warehouse banners, as well as related e-commerce sites. Subsequent to the acquisition, and as a result of our strategic review, we exited the Town Shoes banner in Canada during fiscal 2018.

On November 5, 2018, we completed the acquisition of Camuto LLC, doing business as Camuto Group ("Camuto Group"), a footwear design and brand development organization, from Camuto Group LLC (the "Sellers"). The Camuto Group acquisition provides us a global production, sourcing and design infrastructure, including operations in Brazil and China, a new state-of-the-art distribution center in New Jersey, footwear licenses of brands, including Jessica Simpson and Lucky Brand, and branded e-commerce sites. Camuto Group earns revenue from the sale of wholesale products to retailers, commissions for serving retailers as the design and buying agent for products under private labels ("First Cost"), and the sale of branded products on direct-to-consumer e-commerce sites.

Also on November 5, 2018, in partnership with Authentic Brands Group LLC, a global brand management and marketing company, we formed ABG-Camuto, LLC ("ABG-Camuto"), a joint venture in which we have a 40% interest. This joint venture acquired several intellectual property rights from the Sellers, including Vince Camuto, Louise et Cie, Sole Society, CC Corso Como, Enzo Angiolini and others, and focuses on licensing and developing new category extensions to support the global growth of these brands. We have entered into a licensing agreement with ABG-Camuto whereby we pay royalties on our net sales from the brands owned by ABG-Camuto.

On March 4, 2016, we acquired Ebuys, Inc. ("Ebuys"), an off-price footwear and accessories retailer operating in digital marketplaces. Due to recurring operating losses incurred by Ebuys since its acquisition, as well as increased competitive pressures in the digital marketplace, we decided to exit the business and ended all operations in the first quarter of fiscal 2018.

On August 2, 2016, we signed an agreement with the Apparel Group as an exclusive franchise partner in the Gulf Coast region of the Middle East. During the fourth quarter of fiscal 2018, we provided our termination notice to the Apparel Group in accordance with the terms of the agreement and we are winding down the franchise operations during fiscal 2019.

We present three reportable segments: the U.S. Retail segment, the Canada Retail segment, and the Brand Portfolio segment. The U.S. Retail segment includes stores operated in the U.S. under the DSW Designer Shoe Warehouse banner and its related e-commerce site. The Canada Retail segment, which is the result of the TSL acquisition, includes stores operated in Canada under The Shoe Company, Shoe Warehouse, DSW Designer Shoe Warehouse banners and related e-commerce sites. The Brand Portfolio segment, which is the result of the Camuto Group acquisition, includes sales from wholesale, First Cost, and direct-to-consumer branded e-commerce sites. Our other operating segments are below the quantitative and qualitative thresholds for reportable segments and are aggregated into Other for segment reporting purposes.

Basis of Presentation- The accompanying unaudited, condensed consolidated financial statements have been prepared by management in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, we do not include all of the information and footnotes required by GAAP for complete financial statements. The accompanying financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of the results for the interim periods presented. All such adjustments are of a normal recurring nature. The condensed consolidated financial position, results of operations and cash flows for these interim periods are not necessarily indicative of the results that may be expected in future periods. The balance sheet at February 2, 2019 has been derived from the audited financial statements at that date. The financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019, filed with the U.S. Securities and Exchange Commission (the "SEC") on March 26, 2019.

Fiscal Year- Our fiscal year ends on the Saturday nearest to January 31. References to a fiscal year refer to the calendar year in which the fiscal year begins.

Accounting Policies- The complete summary of significant accounting policies is included in the notes to the consolidated financial statements as presented in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019.

Variable Interest Entities- We have certain joint ventures ("JVs") where each joint venture licenses brands and contracts with Camuto Group to provide design, buying and sourcing services. Under the JVs, Camuto Group is responsible for managing all aspects of the brands and the JVs pay royalties, commissions, or consulting fees to the other parties. We are responsible for providing all funding to support the working capital needs of the JVs. As a result, we have determined that we are the primary beneficiary of the JVs and consolidate the JVs within our financial statements. Assets and liabilities of the JVs in the aggregate are immaterial. At the end of the three months ended August 3, 2019, we terminated two JVs along with related licensing and design, buying and sourcing arrangements.

Integration and Restructuring Costs- During the six months ended August 3, 2019, we incurred integration and restructuring costs related to our prior year acquisition activity, which consisted primarily of $3.6 million in severance, a $6.1 million termination fee for terminating two JVs, and $2.4 million of professional fees and other integration costs. During the six months ended August 4, 2018, we incurred restructuring costs of $2.7 million in severance, primarily related to changes to our store staffing model. These costs are included in operating expenses in the condensed consolidated statements of operations. As of August 3, 2019 and August 4, 2018, we had $4.6 million and $1.6 million, respectively, of severance liability included in accrued expenses on the condensed consolidated balance sheets.

Principles of Consolidation- The condensed consolidated financial statements include the accounts of Designer Brands Inc. and its subsidiaries, including the JVs. All intercompany accounts and transactions have been eliminated in consolidation. All amounts are in United States dollars ("USD"), unless otherwise noted.

Use of Estimates- The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenue and expenses during the reporting period. Significant estimates are required as a part of sales returns allowances, customer allowances and discounts, gift card breakage income, deferred revenue associated with loyalty programs, valuation of inventories, depreciation and amortization, impairments of long-lived assets, intangibles and goodwill, lease accounting, legal reserves, foreign tax contingent liabilities, income taxes, self-insurance reserves, and valuations used to account for acquisitions. Although these estimates are based on management's knowledge of current events and actions it may undertake in the future, actual results could differ from these estimates.

Income Taxes- Our effective tax rate changed from 203.3% for the six months ended August 4, 2018 to 27.9% for the six months ended August 3, 2019. The decrease in the effective tax rate was primarily driven by valuation allowances and the goodwill impairment associated with the TSL acquisition during the six months ended August 4, 2018.

Cash, Cash Equivalents, and Restricted Cash- Cash and cash equivalents represent cash, money market funds and credit card receivables that generally settle within three days. Restricted cash represented cash that was restricted as to withdrawal or usage and consisted of a mandatory cash deposit for certain outstanding letters of credit.

The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows:

(in thousands)	August 3, 2019		February 2, 2019		August 4, 2018
Cash and cash equivalents	$	51,762	$	99,369	$	215,996
Restricted cash, included in prepaid expenses and other current assets	—		1,199		—
Total cash, cash equivalents, and restricted cash shown in the condensed consolidated statements of cash flows	$	51,762	$	100,568	$	215,996

Fair Value- Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are categorized using defined hierarchical levels related to the subjectivity associated with the inputs to fair value measurements as follows:

• Level 1 - Quoted prices in active markets for identical assets or liabilities.

• Level 2 - Quoted prices for similar assets or liabilities in active markets or inputs that are observable.

• Level 3 - Unobservable inputs in which little or no market activity exists.

We measure available-for-sale investments at fair value on a recurring basis. These investments are measured using a market-based approach using inputs such as prices of similar assets in active markets (categorized as Level 2). The carrying value of cash and cash equivalents, accounts receivables and accounts payables approximated their fair values due to their short-term nature.

Prior Period Reclassifications- Certain prior period reclassifications were made to conform to the current period presentation. Franchise costs was reclassified to operating expenses, and accounts payable to related parties was reclassified to accounts payable.

Adoption of ASU 2016-02, Leases- During the first quarter of fiscal 2019, we adopted the new accounting standard for leases, Accounting Standards Update ("ASU") 2016-02 and the related amendments. We elected to initially apply ASU 2016-02 as of February 3, 2019, with the recognition of $1.0 billion of lease assets and $1.1 billion of lease liabilities and a cumulative-effect adjustment that decreased retained earnings by $9.6 million for transition impairments related to previously impaired leased locations. Periods prior to February 3, 2019 were not restated. Upon transition to ASU 2016-02, we recognized lease liabilities based on the present value of the remaining future fixed lease commitments, net of outstanding tenant allowance receivables, with corresponding lease assets. Amounts for prepaid expenses, deferred rent, deferred construction and tenant allowances, the accrual for lease obligations, and favorable and unfavorable leasehold interests were netted against the lease assets. At transition, we elected the package of practical expedients, which allows us to carry forward the historical lease classification and not reassess whether any expired or existing contracts are leases or contain leases. We did not elect the use of hindsight to determine the term of our leases at transition.

A lease liability for new leases is recorded based on the present value of future fixed lease commitments with a corresponding lease asset. For leases classified as operating leases, we recognize a single lease cost on a straight-line basis based on the combined amortization of the lease liability and the lease asset. Other leases will be accounted for as finance arrangements. For real estate leases, we are generally required to pay base rent, real estate taxes, and insurance, which are considered lease components, and maintenance, which is a non-lease component. As provided for under ASU 2016-02, we have elected to not separate non-lease payment components from the associated lease component for all new real estate leases. We determine the discount rate for each lease by estimating the rate that we would be required to pay on a secured borrowing for an amount equal to the lease payments over the lease term.

Prior to the adoption of ASU 2016-02, we recognized rent expense on a straight-line basis over the noncancelable terms of the lease. For leases with fixed increases of the minimum rentals during the noncancelable term, we recorded the difference between the amounts charged to expense and the rent paid as deferred rent and amortized such deferred rent upon the delivery of the lease location by the lessor. In addition, cash allowances received from landlords were deferred and amortized on a straight-line basis over the noncancelable terms of the lease as a reduction of rent expense. Deferred rent and construction and tenant allowances are included in non-current liabilities on the condensed consolidated balance sheets for periods prior to February 3, 2019. Also, we recorded reserves for leased spaces that were abandoned due to closure. Using a credit-adjusted risk-free rate to calculate the present value of the liability, we estimated future lease obligations based on remaining fixed lease payments, estimated or actual sublease income, and any other relevant factors.

Adoption of ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software- Also during the first quarter of fiscal 2019, we early adopted ASU 2018-15 on a prospective basis, which aligned the requirements for capitalizing implementation costs incurred in a cloud computing arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or acquire internal-use software. The adoption of ASU 2018-15 did not have a material impact on our condensed consolidated financial statements.

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Acquisitions and Equity Method Investment

6 Months Ended

Aug. 03, 2019

Business Combinations [Abstract]

Acquisitions and Equity Method Investment

ACQUISITIONS AND EQUITY METHOD INVESTMENT

Step Acquisition of TSL- On May 10, 2018, we acquired the remaining interest in TSL for $36.2 million Canadian dollars ("CAD") ($28.2 million USD), net of acquired cash of $8.5 million CAD ($6.6 million USD), by exercising our call option. This was accounted for as a step acquisition whereby we remeasured to fair value our previously held assets, which included our equity investment in TSL and notes and accounts receivable from TSL, and included these assets in the determination of the purchase price. During the second quarter of fiscal 2018, as a result of the remeasurement, we recorded a loss of $34.0 million to non-operating income (expenses), net, in the consolidated statements of operations. Also during the second quarter of fiscal 2018, we reclassified a net loss of $12.2 million of foreign currency translation adjustments related to the previously held balances from accumulated other comprehensive loss to non-operating income (expenses), net.

The purchase price and the allocation of the total consideration to the fair values of the assets and liabilities acquired was finalized as of February 2, 2019 and consisted of the following (in USD):

(in thousands)	Final Purchase Price and Allocation
Purchase price:
Cash consideration, net of cash acquired	$	28,152
Replacement stock-based awards attributable to pre-acquisition services	196
Fair value of previously held assets	92,242
	$	120,590
Fair value of assets and liabilities acquired:
Inventories	$	66,072
Other current assets	3,687
Property and equipment	41,008
Goodwill	43,022
Intangible assets	20,689
Accounts payable and accrued expenses	(33,196		)
Non-current liabilities	(20,692		)
	$	120,590

The fair value of previously held assets was determined immediately before the business combination, primarily by considering the income valuation approach (discounted cash flow) and the market valuation approach (precedent comparable transactions). Additionally, other information such as current market, industry and macroeconomic conditions were utilized to assist in developing these fair value measurements. The fair value of intangible assets includes $15.7 million for tradenames, $3.6 million for favorable leasehold interests, and $1.4 million for customer relationships associated with the Canada loyalty program. The fair value of unfavorable leasehold interests, included in non-current liabilities, was $7.6 million. The fair value for tradenames was determined using the relief from royalty method of the income approach, the fair value for leasehold interests was determined based on the market valuation approach, and the fair value for customer relationships related to the loyalty program was determined using the replacement cost method. The fair values for property and equipment were determined using the cost and market approaches. The fair value of inventories, which is made up of finished goods, was determined based on market assumptions for realizing a reasonable profit after selling costs.

The goodwill represents the excess of the purchase price over the fair value of the net assets acquired. With this being a step acquisition, the purchase price included the fair value of our previously held assets, which considered the valuation of the TSL enterprise. This valuation identified that the resulting goodwill was not supportable as the value of the acquired net assets exceeded the enterprise fair value. As a result, during fiscal 2018, we recorded a goodwill impairment charge, net of adjustments as a result of recording adjustments to the preliminary purchase allocations, which resulted in impairing all of the Canada Retail segment's goodwill. A portion of the goodwill is not expected to be deductible for income tax purposes.

During the three months and six months ended August 4, 2018, our condensed consolidated statements of operations included revenue and net losses for TSL of $72.5 million and $38.5 million, respectively, which included the goodwill impairment charge of $36.2 million. Primarily in fiscal 2018, we incurred $3.1 million of acquisition-related costs as a result of the step

acquisition (not included in the TSL net loss disclosed in the previous sentence), which were included in operating expenses in the condensed consolidated statements of operations.

Acquisition of Camuto Group- On November 5, 2018, we completed the acquisition of all of the outstanding securities of Camuto Group for $171.3 million, net of acquired cash of $9.7 million. The purchase price of the acquisition, along with the acquired equity investment in ABG-Camuto (discussed below), was funded with available cash and borrowings on the revolving line of credit of $160.0 million.

The following table summarizes the preliminary and revised purchase price and the allocation of the total consideration to the fair values of the assets and liabilities acquired:

(in thousands)	Preliminary Purchase Price and Allocation as of November 5, 2018			Measurement Period Adjustments			Revised Purchase Price and Allocation as of August 3, 2019
Purchase price -
Cash consideration, net of cash acquired	$	171,251		$	—		$	171,251
Fair value of assets and liabilities acquired:
Accounts receivable	$	83,939		$	3,980		$	87,919
Inventories	74,499			(758		)	73,741
Other current assets	7,197			1,045			8,242
Property and equipment	43,906			960			44,866
Goodwill	63,614			26,767			90,381
Intangible asset	27,000			(21,700		)	5,300
Other assets	13,351			—			13,351
Accounts payable and other liabilities	(122,811		)	(2,195		)	(125,006		)
Non-current liabilities	(19,444		)	(8,099		)	(27,543		)
	$	171,251		$	—		$	171,251

The fair value of the intangible asset relates to customer relationships and was based on the excess earnings method under the income approach. The fair value measurement is based on significant unobservable inputs, including the future cash flows and discount and customer attrition rates. The fair values for property and equipment were determined using the cost and market approaches. The fair value of inventories, which is made up of finished goods, was determined based on market assumptions for realizing a reasonable profit after selling costs. The inventory valuation step-up was recognized to cost of goods sold during the fourth quarter of fiscal 2018 based on assumed inventory turns.

The goodwill represents the excess of the purchase price over the fair value of the net assets acquired, and was primarily attributable to acquiring an established design and sourcing process, which provides us the opportunity to expand our exclusive products offering at a lower cost in our retail segments, and an assembled workforce. Goodwill is expected to be deductible for income tax purposes.

Non-current liabilities include $12.7 million of estimated unpaid foreign payroll and other taxes. We recorded an offsetting indemnification asset to other assets, which we expect to collect under the terms of the securities purchase agreement with the Sellers. See Note 16, Commitments and Contingencies, for additional information.

Adjustments made during the three months ended August 3, 2019 are the result of refining preliminary cash flow assumptions relating to certain synergy assumptions to the various reporting units, adjusting accruals and related indemnification receivables based on additional information, and other immaterial adjustments identified as we perform additional analysis of the assets and liabilities acquired. Adjustments to the purchase price and the allocation of the purchase price may be made during a measurement period of up to one year from the acquisition date as additional information that existed at the date of the acquisition is obtained. Measurement period adjustments are recognized on a prospective basis in the period of change. The purchase price is subject to adjustments primarily based upon a working capital provision as provided by the purchase agreement. The allocation of the purchase price is currently based on certain preliminary valuations and analysis that have not been completed as of the date of this filing. In addition, we have not completed the allocation of goodwill to our U.S. Retail and Brand Portfolio segments or the reporting units within the Brand Portfolio segment.

Primarily during fiscal 2018, we incurred $22.2 million of acquisition-related costs as a result of the acquisition, which were included in operating expenses in the condensed consolidated statements of operations.

Equity Investment in ABG-Camuto- On November 5, 2018, we acquired a 40% interest in the newly formed ABG-Camuto joint venture for $56.8 million in partnership with Authentic Brands Group LLC. Also on November 5, 2018, ABG-Camuto acquired several intellectual property rights from the Sellers and entered into a licensing agreement with us, which earns royalties from the net sales of Camuto Group under the brands acquired.

Activity related to our equity investment in ABG-Camuto was as follows:

(in thousands)	Six Months Ended August 3, 2019
Balance at beginning of period	$	58,125
Share of net earnings	4,692
Distributions received	(7,784		)
Balance at end of period	$	55,033

Combined Results- The following table provides the supplemental pro forma total revenue and net loss of the combined entity had the acquisition dates of TSL and Camuto Group and the investment in ABG-Camuto been the first day of our fiscal 2017:

(in thousands)	Three months ended August 4, 2018			Six months ended August 4, 2018
Total revenue	$	886,780		$	1,755,210
Net loss	$	(45,722	)	$	(33,131	)

The amounts in the supplemental pro forma results apply our accounting policies, eliminate intercompany transactions, assume the acquisition-related transaction costs were incurred in fiscal 2017, and reflect adjustments for additional expenses that would have been charged assuming borrowings on the revolving line of credit of $160 million and the same fair value adjustments to inventory, property and equipment, and acquired intangibles had been applied on the first day of our fiscal 2017. Related to the TSL acquisition, the supplemental pro forma results also exclude the loss related to the remeasurement of previously held assets, the net loss of foreign currency translation related to the previously held balances from accumulated other comprehensive loss, and the goodwill impairment charge. Because the ABG-Camuto investment was integral to the Camuto Group acquisition, the supplemental pro forma results include royalty expenses that would be due to ABG-Camuto using the guaranteed minimum royalties per the license agreement and the related earnings from our equity investment in ABG-Camuto had the transactions occurred on the first day of our fiscal 2017. Accordingly, these supplemental pro forma results have been prepared for comparative purposes only and are not intended to be indicative of results of operations that would have occurred had the acquisitions actually occurred in the prior year period or indicative of the results of operations for any future period.

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Revenue

6 Months Ended

Aug. 03, 2019

Revenue from Contract with Customer [Abstract]

Revenue

REVENUE

Disaggregation of Revenue- The following table presents our total revenue disaggregated by segments:

	Three months ended					Six months ended
(in thousands)	August 3, 2019			August 4, 2018		August 3, 2019			August 4, 2018
Segment net sales:
U.S. Retail	$	677,920		$	691,757	$	1,369,760		$	1,361,541
Canada Retail	63,306			72,532		115,122			72,532
Brand Portfolio	95,422			—		196,289			—
Other	29,480			29,446		65,087			70,099
Total net sales	866,128			793,735		1,746,258			1,504,172
Commission, franchise and other revenue	11,771			1,533		20,676			3,198
	877,899			795,268		1,766,934			1,507,370
Elimination of intersegment revenue	(17,701		)	—		(28,221		)	—
Total revenue	$	860,198		$	795,268	$	1,738,713		$	1,507,370

The U.S. Retail and Brand Portfolio segments and Other net sales recognized are primarily based on sales to customers in the U.S., and Canada Retail segment net sales recognized are based on sales to customers in Canada. Revenue realized from geographic markets outside of the U.S. and Canada have collectively been immaterial.

The following table presents total revenue by product and service category:

	Three months ended					Six months ended
(in thousands)	August 3, 2019			August 4, 2018		August 3, 2019			August 4, 2018
Net sales:
U.S. Retail segment:
Women's footwear	$	458,390		$	467,337	$	940,511		$	936,621
Men's footwear	140,895			151,573		269,884			284,732
Accessories, kids and other	78,635			72,847		159,365			140,188
	677,920			691,757		1,369,760			1,361,541
Canada Retail segment:
Women's footwear	35,533			42,067		64,159			42,067
Men's footwear	16,432			19,455		29,440			19,455
Accessories, kids and other	11,341			11,010		21,523			11,010
	63,306			72,532		115,122			72,532
Brand Portfolio segment:
Wholesale	88,577			—		180,331			—
Direct-to-consumer	6,845			—		15,958			—
	95,422			—		196,289			—
Other	29,480			29,446		65,087			70,099
Total net sales	866,128			793,735		1,746,258			1,504,172
Commission, franchise and other revenue	11,771			1,533		20,676			3,198
	877,899			795,268		1,766,934			1,507,370
Elimination of intersegment revenue	(17,701		)	—		(28,221		)	—
Total revenue	$	860,198		$	795,268	$	1,738,713		$	1,507,370

Deferred Revenue Liabilities- We record deferred revenue liabilities, included in accrued expenses on the condensed consolidated balance sheets, for remaining obligations we have to our customers. The following table presents the changes and total balances for gift cards and our loyalty programs:

	Three months ended						Six months ended
(in thousands)	August 3, 2019			August 4, 2018			August 3, 2019			August 4, 2018
Gift cards:
Beginning of period	$	30,066		$	28,151		$	34,998		$	32,792
Gift cards redeemed and breakage recognized to net sales	(21,843		)	(21,761		)	(44,098		)	(44,034		)
Gift cards issued	20,054			20,401			37,377			38,033
End of period	$	28,277		$	26,791		$	28,277		$	26,791
Loyalty programs:
Beginning of period	$	16,153		$	22,111		$	16,151		$	21,282
Loyalty certificates redeemed and expired and other adjustments recognized to net sales	(9,507		)	(16,750		)	(18,828		)	(23,385		)
Deferred revenue for loyalty points issued	9,388			11,425			18,711			18,889
End of period	$	16,034		$	16,786		$	16,034		$	16,786

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Related Party Transactions

6 Months Ended

Aug. 03, 2019

Related Party Transactions [Abstract]

Related Party Transactions

RELATED PARTY TRANSACTIONS

Schottenstein Affiliates

As of August 3, 2019, the Schottenstein Affiliates, entities owned or controlled by Jay L. Schottenstein, the executive chairman of our Board of Directors, and members of his family, beneficially owned approximately 15% of the Company's outstanding common shares, representing approximately 51% of the combined voting power. As of August 3, 2019, the Schottenstein Affiliates beneficially owned 3.4 million Class A common shares and 7.7 million Class B common shares. We had the following related party transactions with Schottenstein Affiliates:

Leases- We lease our fulfillment center and certain store locations owned by Schottenstein Affiliates. See Note 15, Leases, for rent expense and future minimum lease payment requirements associated with the Schottenstein Affiliates.

Other Purchases and Services- During the three months ended August 3, 2019 and August 4, 2018, we had other purchases and services from Schottenstein Affiliates of $1.5 million and $1.7 million, respectively. During the six months ended August 3, 2019 and August 4, 2018, we had other purchases and services from Schottenstein Affiliates of $3.4 million and $3.3 million, respectively.

Due to Related Parties- As of August 3, 2019, February 2, 2019 and August 4, 2018, we had amounts due to related parties of $0.5 million, $1.0 million and $0.5 million, respectively, included in accounts payable on the condensed consolidated balance sheets.

ABG-Camuto

Beginning in the fourth quarter of fiscal 2018, we have a 40% interest in ABG-Camuto. ABG-Camuto entered into a licensing agreement with us whereby we pay royalties on the net sales of the brands owned by ABG-Camuto. During the three and six months ended August 3, 2019, we recorded $3.6 million and $9.3 million of royalty expense payable to ABG-Camuto, respectively. As of February 2, 2019, we had $2.4 million payable to ABG-Camuto, included in accrued expenses on the condensed consolidated balance sheets.

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Earnings (Loss) Per Share

6 Months Ended

Aug. 03, 2019

Earnings Per Share [Abstract]

Earnings (Loss) Per Share

EARNINGS (LOSS) PER SHARE

Basic earnings (loss) per share is based on net income (loss) and the weighted average of Class A and Class B common shares outstanding. Diluted earnings (loss) per share reflects the potential dilution of common shares adjusted for outstanding stock options, restricted stock units ("RSUs"), and performance-based restricted stock units ("PSUs") calculated using the treasury stock method.

The following is a reconciliation of the number of shares used in the calculation of earnings (loss) per share:

	Three months ended		Six months ended
(in thousands)	August 3, 2019	August 4, 2018	August 3, 2019	August 4, 2018
Weighted average basic shares outstanding	73,529	80,265	75,267	80,187
Dilutive effect of stock-based compensation awards	787	—	1,014	—
Weighted average diluted shares outstanding	74,316	80,265	76,281	80,187

For the three months ended August 3, 2019 and August 4, 2018, the number of potential shares that were not included in the computation of diluted earnings (loss) per share due to the anti-dilutive effect was 4.6 million and 3.2 million, respectively. For the six months ended August 3, 2019 and August 4, 2018, the number of potential shares that were not included in the computation of diluted earnings (loss) per share due to the anti-dilutive effect was 2.9 million and 3.2 million, respectively.

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Stock-Based Compensation

6 Months Ended

Aug. 03, 2019

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

STOCK-BASED COMPENSATION

Stock-based compensation expense consisted of the following:

	Three months ended				Six months ended
(in thousands)	August 3, 2019		August 4, 2018		August 3, 2019		August 4, 2018
Stock options	$	563	$	1,343	$	1,386	$	3,138
Restricted and director stock units	4,798		3,841		8,345		6,560
	$	5,361	$	5,184	$	9,731	$	9,698

The following table summarizes the stock-based compensation award activity for the six months ended August 3, 2019:

	Number of shares
(in thousands)	Stock Options		Time-Based RSUs		Performance-Based RSUs
Outstanding - beginning of period	4,001		989		596
Granted	—		841		358
Exercised / vested	(99	)	(111	)	(97	)
Forfeited / expired	(38	)	(56	)	—
Outstanding - end of period	3,864		1,663		857

As of August 3, 2019, 2.7 million shares of Class A common shares remain available for future stock-based compensation grants under the 2014 Long-Term Incentive Plan.

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Shareholders' Equity

6 Months Ended

Aug. 03, 2019

Equity [Abstract]

Shareholders' Equity

SHAREHOLDERS' EQUITY

Shares- Our Class A common shares are listed for trading under the ticker symbol "DBI" on the New York Stock Exchange. There is currently no public market for the Company's Class B common shares, but the Class B common shares can be exchanged for the Company's Class A common shares at the election of the holder on a share for share basis. Holders of Class A common shares are entitled to one vote per share and holders of Class B common shares are entitled to eight votes per share on matters submitted to shareholders for approval.

The following table provides additional information for our common shares:

	August 3, 2019		February 2, 2019		August 4, 2018
(in thousands)	Class A	Class B	Class A	Class B	Class A	Class B
Authorized shares	250,000	100,000	250,000	100,000	250,000	100,000
Issued shares	86,080	7,733	85,763	7,733	85,652	7,733
Outstanding shares	64,911	7,733	70,672	7,733	72,561	7,733
Treasury shares	21,169	—	15,091	—	13,091	—

We have authorized 100 million shares of no par value preferred shares with no shares issued for any of the periods presented.

Dividends- On August 29, 2019, the Board of Directors declared a quarterly cash dividend payment of $0.25 per share for both Class A and Class B common shares. The dividend will be paid on October 4, 2019 to shareholders of record at the close of business on September 20, 2019.

Share Repurchases- On August 17, 2017, the Board of Directors authorized the repurchase of an additional $500 million of Class A common shares under our share repurchase program, which was added to the $33.5 million remaining from the previous authorization. During the six months ended August 3, 2019, we repurchased 6.1 million Class A common shares at a cost of $125.0 million, with $351.6 million of Class A common shares that remain authorized under the program as of August 3, 2019. During the six months ended August 4, 2018, we did not repurchase any Class A common shares. The share repurchase program may be suspended, modified or discontinued at any time, and we have no obligation to repurchase any amount of our common shares under the program. Shares will be repurchased in the open market at times and in amounts considered appropriate based on price and market conditions.

Accumulated Other Comprehensive Loss- Changes for the balances of each component of accumulated other comprehensive loss were as follows (all amounts are net of tax):

	Three months ended
	August 3, 2019									August 4, 2018
(in thousands)	Foreign Currency Translation			Available-for-Sale Securities			Total			Foreign Currency Translation			Available-for-Sale Securities			Total
Accumulated other comprehensive loss - beginning of period	$	(3,042	)	$	(224	)	$	(3,266	)	$	(12,218	)	$	(980	)	$	(13,198	)
Other comprehensive income (loss) before reclassifications	461			196			657			(1,365		)	27			(1,338		)
Amounts reclassified to non-operating income (expenses), net	—			23			23			12,218			42			12,260
Other comprehensive income	461			219			680			10,853			69			10,922
Accumulated other comprehensive loss - end of period	$	(2,581	)	$	(5	)	$	(2,586	)	$	(1,365	)	$	(911	)	$	(2,276	)

	Six months ended
	August 3, 2019									August 4, 2018
(in thousands)	Foreign Currency Translation			Available-for-Sale Securities			Total			Foreign Currency Translation			Available-for-Sale Securities			Total
Accumulated other comprehensive loss - beginning of period	$	(2,328	)	$	(378	)	$	(2,706	)	$	(9,278	)	$	(796	)	$	(10,074	)
Other comprehensive income (loss) before reclassifications	(253		)	438			185			(6,050		)	(317		)	(6,367		)
Amounts reclassified to non-operating expenses, net	—			(65		)	(65		)	13,963			202			14,165
Other comprehensive income (loss)	(253		)	373			120			7,913			(115		)	7,798
Accumulated other comprehensive loss - end of period	$	(2,581	)	$	(5	)	$	(2,586	)	$	(1,365	)	$	(911	)	$	(2,276	)

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Accounts Receivable

6 Months Ended

Aug. 03, 2019

Accounts Receivable [Abstract]

Accounts Receivable

ACCOUNTS RECEIVABLE

Accounts receivable, net, consisted of the following:

(in thousands)	August 3, 2019			February 2, 2019			August 4, 2018
Customer accounts receivables:
Serviced by third-party provider with guaranteed payment	$	61,494		$	47,599		$	—
Serviced by third-party provider without guaranteed payment	495			280			—
Serviced in-house	10,145			9,892			3,090
Construction and tenant allowance receivables due from landlords(1)	—			4,034			5,201
Other receivables	14,460			8,004			8,968
Accounts receivable	86,594			69,809			17,259
Allowance for doubtful accounts	(1,432		)	(939		)	—
Accounts receivable, net	$	85,162		$	68,870		$	17,259

(1)

Upon transition to ASU 2016-02 at the beginning of fiscal 2019, amounts for construction and tenant allowance receivables due from landlords were netted against the operating lease liabilities.

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Investments

6 Months Ended

Aug. 03, 2019

Investments [Abstract]

Investments

INVESTMENTS

Investments in available-for-sale securities consisted of the following:

(in thousands)	August 3, 2019			February 2, 2019			August 4, 2018
Carrying value of investments	$	25,510		$	70,195		$	73,978
Unrealized gains included in accumulated other comprehensive loss	18			44			10
Unrealized losses included in accumulated other comprehensive loss	(24		)	(521		)	(869		)
Fair value	$	25,504		$	69,718		$	73,119

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Property and Equipment

6 Months Ended

Aug. 03, 2019

Property, Plant and Equipment [Abstract]

Property and Equipment

PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

(in thousands)	August 3, 2019			February 2, 2019			August 4, 2018
Land	$	1,110		$	1,110		$	1,110
Buildings	13,445			12,485			12,485
Building and leasehold improvements	440,425			437,116			425,651
Furniture, fixtures and equipment	489,805			487,494			451,040
Software	183,226			161,226			145,111
Construction in progress(1)	41,454			38,646			46,643
Total property and equipment	1,169,465			1,138,077			1,082,040
Accumulated depreciation and amortization	(766,686		)	(728,501		)	(694,419		)
Property and equipment, net	$	402,779		$	409,576		$	387,621

(1)

Construction in progress is comprised primarily of the construction of leasehold improvements and furniture and fixtures related to unopened stores and internal-use software under development.

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Goodwill and Intangible Assets

6 Months Ended

Aug. 03, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

GOODWILL AND INTANGIBLE ASSETS

Goodwill- Activity related to our goodwill was as follows:

	Six months ended
	August 3, 2019								August 4, 2018
(in thousands)	Goodwill			Accumulated Impairments			Net		Goodwill			Accumulated Impairments			Net
Beginning of period by segment:
U.S. Retail	$	25,899		$	—		$	25,899	$	25,899		$	—		$	25,899
Canada Retail	42,048			(42,048		)	—		—			—			—
Brand Portfolio	63,614			—			63,614		—			—			—
Other	—			—			—		53,790			(53,790		)	—
	131,561			(42,048		)	89,513		79,689			(53,790		)	25,899
Activity by segment:
Canada Retail:
Acquired TSL goodwill	—			—			—		37,044			—			37,044
Impairment charges	—			—			—		—			(36,240		)	(36,240		)
Currency translation adjustment	(416		)	416			—		(580		)	(224		)	(804		)
Brand Portfolio -
Purchase price and allocation adjustments	26,767			—			26,767		—			—			—
Other - Eliminated goodwill from Ebuys exit	—			—			—		(53,790		)	53,790			—
	26,351			416			26,767		(17,326		)	17,326			—
End of period by segment:
U.S. Retail	25,899			—			25,899		25,899			—			25,899
Canada Retail	41,632			(41,632		)	—		36,464			(36,464		)	—
Brand Portfolio	90,381			—			90,381		—			—			—
	$	157,912		$	(41,632	)	$	116,280	$	62,363		$	(36,464	)	$	25,899

Intangible Assets- Intangible assets consisted of the following:

(in thousands)	Cost		Accumulated Amortization			Net
August 3, 2019
Definite-lived customer relationships	$	6,661	$	(1,064	)	$	5,597
Indefinite-lived trademarks and tradenames	15,515		—			15,515
	$	22,176	$	(1,064	)	$	21,112
February 2, 2019
Definite-lived:
Customer relationships	$	28,375	$	(1,010	)	$	27,365
Favorable leasehold interests	3,513		(295		)	3,218
Indefinite-lived trademarks and tradenames	15,546		—			15,546
	$	47,434	$	(1,305	)	$	46,129
August 4, 2018
Definite-lived:
Customer relationships	$	1,378	$	(114	)	$	1,264
Favorable leasehold interests	3,522		(101		)	3,421
Indefinite-lived trademarks and tradenames	15,600		—			15,600
	$	20,500	$	(215	)	$	20,285

The customer relationships are amortized by the straight-line method over three years associated with the Canada loyalty program and eight years for Brand Portfolio customer relationships. Upon transition to ASU 2016-02 at the beginning of fiscal 2019, amounts for favorable leasehold interests were netted against the operating lease assets.

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Accrued Expenses

6 Months Ended

Aug. 03, 2019

Payables and Accruals [Abstract]

Accrued Expenses

ACCRUED EXPENSES

Accrued expenses consisted of the following:

(in thousands)	August 3, 2019		February 2, 2019		August 4, 2018
Gift cards and merchandise credits	$	28,277	$	34,998	$	26,791
Accrued compensation and related expenses	38,532		53,577		30,224
Accrued taxes	18,330		16,491		21,029
Loyalty programs deferred revenue	16,034		16,151		16,786
Sales returns	19,332		17,743		14,426
Customer allowances and discounts	9,306		13,094		—
Other(1)	43,626		49,481		36,520
	$	173,437	$	201,535	$	145,776

(1)

Other is comprised of various other accrued expenses that we expect will settle within one year of the applicable period.

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Other Non-Current Liabilities

6 Months Ended

Aug. 03, 2019

Other Liabilities Disclosure [Abstract]

Other Non-Current Liabilities

OTHER NON-CURRENT LIABILITIES

Other non-current liabilities consisted of the following:

(in thousands)	August 3, 2019		February 2, 2019		August 4, 2018
Foreign tax contingent liabilities	$	14,807	$	13,429	$	—
Deferred tax liabilities	3,393		3,260		—
Construction and tenant allowances(1)	—		71,634		75,439
Deferred rent(1)	—		35,934		35,694
Accrual for lease obligations(1)	—		16,483		9,511
Unfavorable leasehold interests(1)	—		5,779		7,000
Other(2)	20,390		18,528		22,672
	$	38,590	$	165,047	$	150,316

(1) Upon transition to ASU 2016-02 at the beginning of fiscal 2019, amounts for deferred rent, construction and tenant allowances, the accrual for lease obligations, and unfavorable leasehold interests were netted against the operating lease assets.

(2) Other is comprised of various other accrued expenses that we expect will settle beyond one year from the end of the applicable period.

The following table presents the changes and total balances for the accrual for lease obligations:

	Six months ended
(in thousands)	August 3, 2019			August 4, 2018
Beginning of period	$	16,483		$	6,511
Netted against lease assets upon transition to ASU 2016-02	(16,483		)	—
Additions	—			4,884
Lease obligation payments, net of sublease income	—			(2,004		)
Adjustments	—			120
End of period	$	—		$	9,511

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Debt

6 Months Ended

Aug. 03, 2019

Debt Disclosure [Abstract]

Debt

DEBT

Credit Facility- On August 25, 2017, we entered into a senior unsecured revolving credit agreement (the "Credit Facility") with a maturity date of August 25, 2022 that replaced our previous secured revolving credit agreement and letter of credit agreement. On October 10, 2018, the Credit Facility was amended to include the acquisition of Camuto Group as a permitted acquisition and, following the acquisition, to utilize an accordion feature that provided for an increase to the revolving line of credit. On November 5, 2018, following the acquisition of Camuto Group, the amended Credit Facility was increased with no change to the sub-limits. As of August 3, 2019, the Credit Facility provided a revolving line of credit up to $400 million, with sub-limits for the issuance of up to $50 million in letters of credit, swing loan advances of up to $15 million, and the issuance of up to $75 million in foreign currency revolving loans and letters of credit. The Credit Facility may be used to provide funds for working capital, capital expenditures, share repurchases, other expenditures, and permitted acquisitions as defined by the Credit Facility. Our Credit Facility allows the payments of dividends by us or our subsidiaries, provided that immediately before and after a dividend payment there is no event of default, as defined in our Credit Facility.

Loans issued under the revolving line of credit bear interest, at our option, at a base rate or an alternate base rate as defined in the Credit Facility plus a margin based on our leverage ratio, with an interest rate of 4.1% as of August 3, 2019. Any loans issued in CAD bear interest at the alternate base rate plus a margin based on our leverage ratio. Interest on letters of credit issued under the Credit Facility is variable based on our leverage ratio and the type of letters of credit, with an interest rate of 1.7% as of August 3, 2019. Commitment fees are based on the average unused portion of the Credit Facility at a variable rate based on our leverage ratio. As of August 3, 2019, we had $235.0 million outstanding under the Credit Facility and $1.3 million in letters of credit issued, resulting in $163.7 million available for borrowings. Interest expense related to the Credit Facility includes interest on borrowings and letters of credit, commitment fees and the amortization of debt issuance costs.

Debt Covenants- The Credit Facility contains financial and other covenants, including, but not limited to, limitations on indebtedness, liens and investments, as well as the maintenance of a leverage ratio not to exceed 3.25:1 and a fixed charge coverage ratio not to be less than 1.75:1. As a result of the acquisition of Camuto Group, we have elected to increase the leverage ratio whereby we must maintain a leverage ratio not to exceed 3.50:1 as of the end of the fourth quarter of fiscal 2018 and for the subsequent three quarters. A violation of any of the covenants could result in a default under the Credit Facility that would permit the lenders to restrict our ability to further access the Credit Facility for loans and letters of credit and require the immediate repayment of any outstanding loans under the Credit Facility. As of August 3, 2019, we were in compliance with all financial covenants.

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Leases

6 Months Ended

Aug. 03, 2019

Leases [Abstract]

Leases

LEASES

We lease our stores, fulfillment center and other facilities under operating lease arrangements with unrelated parties and related parties owned by Schottenstein Affiliates. The majority of our real estate leases provide for renewal options, which are typically not included in the lease term used for measuring the lease assets and lease liabilities as it is not reasonably certain we will exercise options. We pay variable amounts for certain lease and non-lease components as well as for contingent rentals based on sales for certain leases where the sales are in excess of specified levels and for leases that have certain contingent triggering events that are in effect. We also lease equipment under operating leases.

We receive operating lease income from unrelated third parties for leasing portions or all of certain owned and leased properties. Operating lease income is included in commission, franchise and other revenue in our condensed consolidated statements of operations.

Lease income and lease expense consisted of the following for the three and six months ended August 3, 2019 (after the adoption of ASU 2016-02) and August 4, 2018 (prior to the adoption of ASU 2016-02):

	Three months ended				Six months ended
(in thousands)	August 3, 2019		August 4, 2018		August 3, 2019		August 4, 2018
Operating lease income	$	2,236	$	1,149	$	4,448	$	2,297
Operating lease expense:
Lease expense to unrelated parties	$	52,707	$	51,263	$	106,061	$	96,748
Lease expense to related parties	2,371		2,303		4,713		4,591
Variable lease expense to unrelated parties	12,981		5,675		26,003		12,498
Variable lease expense to related parties	348		—		650		—
	$	68,407	$	59,241	$	137,427	$	113,837

	August 3, 2019
Other operating lease information:
Weighted-average remaining lease term	6.3 years
Weighted-average discount rate	3.9	%

As of August 3, 2019, our future fixed minimum lease payments are as follows:

(in thousands)	Unrelated Parties			Related Parties			Total
Remainder of fiscal 2019	$	96,844		$	3,937		$	100,781
Fiscal 2020	233,961			9,364			243,325
Fiscal 2021	216,107			8,697			224,804
Fiscal 2022	182,432			7,418			189,850
Fiscal 2023	142,408			4,573			146,981
Future fiscal years thereafter	314,601			15,493			330,094
	1,186,353			49,482			1,235,835
Less discounting impact on operating leases	(138,305		)	(6,015		)	(144,320		)
Total operating lease liabilities	1,048,048			43,467			1,091,515
Less current operating lease liabilities	(178,091		)	(7,878		)	(185,969		)
Non-current operating lease liabilities	$	869,957		$	35,589		$	905,546

As of August 3, 2019, we have entered into lease commitments for four new store locations and two store relocations where the leases have not yet commenced, and the lease liabilities have not yet been recorded. We expect the lease commencement to begin in the next fiscal quarter for these locations and we will record additional operating lease liabilities of approximately $11.4 million.

As of February 2, 2019, future minimum lease payment requirements, excluding contingent rental payments, maintenance, insurance, real estate taxes, and the amortization of deferred rent and construction and tenant allowances, consisted of the following, as determined prior to the adoption of ASU 2016-02:

(in thousands)	Unrelated Parties		Related Parties		Total
Fiscal 2019	$	233,237	$	9,425	$	242,662
Fiscal 2020	227,001		9,364		236,365
Fiscal 2021	204,803		8,697		213,500
Fiscal 2022	170,030		6,518		176,548
Fiscal 2023	131,594		1,874		133,468
Future fiscal years thereafter	298,437		5,596		304,033
	$	1,265,102	$	41,474	$	1,306,576

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Commitments and Contingencies

6 Months Ended

Aug. 03, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

COMMITMENTS AND CONTINGENCIES

Legal Proceedings- We are involved in various legal proceedings that are incidental to the conduct of our business. Although it is not possible to predict with certainty the eventual outcome of any litigation, we believe the amount of any potential liability with respect to current legal proceedings will not be material to the results of operations or financial condition. As additional information becomes available, we will assess any potential liability related to pending litigation and revise the estimates as needed.

Foreign Tax Contingencies- During the due diligence procedures performed related to the acquisition of Camuto Group, we identified probable contingent liabilities associated with unpaid foreign payroll and other taxes that could also result in assessed penalties and interest. We have developed an estimate of the range of outcomes related to these obligations of $14.8 million to $30.0 million for obligations we are aware of at this time. As of August 3, 2019, we recorded a contingent liability of $14.8 million representing the low end of the range and an indemnification asset of $12.7 million representing the estimated amount as of the acquisition date, which we expect to collect under the terms of the securities purchase agreement with the Sellers. We are continuing to assess the exposure, which may result in material changes to these estimates, and we may identify additional contingent liabilities. We believe that the Sellers are obligated to indemnify us for any payments to foreign taxing authorities for the periods up to the acquisition date. Although a portion of the purchase price is held in escrow and another portion is held in a restricted bank account, there can be no assurance that we will successfully collect all amounts that we may be obligated to settle with the foreign taxing authorities.

Guarantee- As a result of a previous merger, we provided a guarantee for a lease commitment that is scheduled to expire in 2024 for a location that has been leased to a third party. If the third party does not pay the rent or vacates the premise, we may be required to make full rent payments to the landlord. As of August 3, 2019, the total future minimum lease payment requirements for this guarantee were approximately $15.0 million.

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Segment Reporting

6 Months Ended

Aug. 03, 2019

Segment Reporting [Abstract]

Segment Reporting

SEGMENT REPORTING

Our three reportable segments, which are also operating segments, are the U.S. Retail segment, the Canada Retail segment, and the Brand Portfolio segment. All other operating segments are below the quantitative and qualitative thresholds for reportable segments and are aggregated into Other for segment reporting purposes. The following provides certain financial data by segment reconciled to the condensed consolidated financial statements:

(in thousands)	U.S. Retail		Canada Retail		Brand Portfolio		Other		Corporate/Eliminations			Total
Three months ended August 3, 2019
External revenue:
Net sales	$	677,920	$	63,306	$	78,934	$	29,480	$	—		$	849,640
Commission, franchise and other revenue	—		—		6,312		—		4,246			10,558
Total revenue	$	677,920	$	63,306	$	85,246	$	29,480	$	4,246		$	860,198
Intersegment revenue	$	—	$	—	$	17,701	$	—	$	(17,701	)	$	—
Gross profit(1)	$	208,056	$	21,939	$	19,261	$	6,041	$	(436	)	$	254,861
Income from equity investment in ABG-Camuto	$	—	$	—	$	2,464	$	—	$	—		$	2,464
Three months ended August 4, 2018
Revenue:
Net sales	$	691,757	$	72,532	$	—	$	29,446	$	—		$	793,735
Commission, franchise and other revenue	—		—		—		—		1,533			1,533
Total revenue	$	691,757	$	72,532	$	—	$	29,446	$	1,533		$	795,268
Gross profit(1)	$	229,601	$	18,218	$	—	$	6,676	$	—		$	254,495
Six months ended August 3, 2019
External revenue:
Net sales	$	1,369,760	$	115,122	$	169,663	$	65,087	$	—		$	1,719,632
Commission, franchise and other revenue	—		—		9,609		—		9,472			19,081
Total revenue	$	1,369,760	$	115,122	$	179,272	$	65,087	$	9,472		$	1,738,713
Intersegment revenue	$	—	$	—	$	28,221	$	—	$	(28,221	)	$	—
Gross profit(1)	$	417,947	$	37,686	$	41,255	$	15,352	$	(1,343	)	$	510,897
Income from equity investment in ABG-Camuto	$	—	$	—	$	4,692	$	—	$	—		$	4,692
Six months ended August 4, 2018
Revenue:
Net sales	$	1,361,541	$	72,532	$	—	$	70,099	$	—		$	1,504,172
Commission, franchise and other revenue	—		—		—		—		3,198			3,198
Total revenue	$	1,361,541	$	72,532	$	—	$	70,099	$	3,198		$	1,507,370
Gross profit(1)	$	427,945	$	18,218	$	—	$	13,557	$	—		$	459,720

(1)

Gross profit is defined as net sales, which excludes commission, franchise and other revenue, less cost of sales.

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Significant Accounting Policies (Policies)

6 Months Ended

Aug. 03, 2019

Accounting Policies [Abstract]

Basis of Accounting, Policy

Basis of Presentation- The accompanying unaudited, condensed consolidated financial statements have been prepared by management in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, we do not include all of the information and footnotes required by GAAP for complete financial statements. The accompanying financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of the results for the interim periods presented. All such adjustments are of a normal recurring nature. The condensed consolidated financial position, results of operations and cash flows for these interim periods are not necessarily indicative of the results that may be expected in future periods. The balance sheet at February 2, 2019 has been derived from the audited financial statements at that date. The financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019, filed with the U.S. Securities and Exchange Commission (the "SEC") on March 26, 2019.

Fiscal Period, Policy

Fiscal Year- Our fiscal year ends on the Saturday nearest to January 31. References to a fiscal year refer to the calendar year in which the fiscal year begins.

Consolidation, Variable Interest Entity, Policy [Policy Text Block]

Variable Interest Entities- We have certain joint ventures ("JVs") where each joint venture licenses brands and contracts with Camuto Group to provide design, buying and sourcing services. Under the JVs, Camuto Group is responsible for managing all aspects of the brands and the JVs pay royalties, commissions, or consulting fees to the other parties. We are responsible for providing all funding to support the working capital needs of the JVs. As a result, we have determined that we are the primary beneficiary of the JVs and consolidate the JVs within our financial statements. Assets and liabilities of the JVs in the aggregate are immaterial. At the end of the three months ended August 3, 2019, we terminated two JVs along with related licensing and design, buying and sourcing arrangements.

Business Acquisition, Integration, Restructuring and Other Related Costs [Text Block]

Integration and Restructuring Costs- During the six months ended August 3, 2019, we incurred integration and restructuring costs related to our prior year acquisition activity, which consisted primarily of $3.6 million in severance, a $6.1 million termination fee for terminating two JVs, and $2.4 million of professional fees and other integration costs. During the six months ended August 4, 2018, we incurred restructuring costs of $2.7 million in severance, primarily related to changes to our store staffing model. These costs are included in operating expenses in the condensed consolidated statements of operations. As of August 3, 2019 and August 4, 2018, we had $4.6 million and $1.6 million, respectively, of severance liability included in accrued expenses on the condensed consolidated balance sheets.

Consolidation, Policy

Principles of Consolidation- The condensed consolidated financial statements include the accounts of Designer Brands Inc. and its subsidiaries, including the JVs. All intercompany accounts and transactions have been eliminated in consolidation. All amounts are in United States dollars ("USD"), unless otherwise noted.

Use of Estimates, Policy

Use of Estimates- The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenue and expenses during the reporting period. Significant estimates are required as a part of sales returns allowances, customer allowances and discounts, gift card breakage income, deferred revenue associated with loyalty programs, valuation of inventories, depreciation and amortization, impairments of long-lived assets, intangibles and goodwill, lease accounting, legal reserves, foreign tax contingent liabilities, income taxes, self-insurance reserves, and valuations used to account for acquisitions. Although these estimates are based on management's knowledge of current events and actions it may undertake in the future, actual results could differ from these estimates.

Income Tax, Policy

Income Taxes- Our effective tax rate changed from 203.3% for the six months ended August 4, 2018 to 27.9% for the six months ended August 3, 2019.

Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy

Cash, Cash Equivalents, and Restricted Cash- Cash and cash equivalents represent cash, money market funds and credit card receivables that generally settle within three days. Restricted cash represented cash that was restricted as to withdrawal or usage and consisted of a mandatory cash deposit for certain outstanding letters of credit.

Fair Value Measurement, Policy

Fair Value- Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are categorized using defined hierarchical levels related to the subjectivity associated with the inputs to fair value measurements as follows:

• Level 1 - Quoted prices in active markets for identical assets or liabilities.

• Level 2 - Quoted prices for similar assets or liabilities in active markets or inputs that are observable.

• Level 3 - Unobservable inputs in which little or no market activity exists.

We measure available-for-sale investments at fair value on a recurring basis. These investments are measured using a market-based approach using inputs such as prices of similar assets in active markets (categorized as Level 2). The carrying value of cash and cash equivalents, accounts receivables and accounts payables approximated their fair values due to their short-term nature.

Reclassification, Policy

Prior Period Reclassifications- Certain prior period reclassifications were made to conform to the current period presentation. Franchise costs was reclassified to operating expenses, and accounts payable to related parties was reclassified to accounts payable.

New Accounting Pronouncements, Policy

Adoption of ASU 2016-02, Leases- During the first quarter of fiscal 2019, we adopted the new accounting standard for leases, Accounting Standards Update ("ASU") 2016-02 and the related amendments. We elected to initially apply ASU 2016-02 as of February 3, 2019, with the recognition of $1.0 billion of lease assets and $1.1 billion of lease liabilities and a cumulative-effect adjustment that decreased retained earnings by $9.6 million for transition impairments related to previously impaired leased locations. Periods prior to February 3, 2019 were not restated. Upon transition to ASU 2016-02, we recognized lease liabilities based on the present value of the remaining future fixed lease commitments, net of outstanding tenant allowance receivables, with corresponding lease assets. Amounts for prepaid expenses, deferred rent, deferred construction and tenant allowances, the accrual for lease obligations, and favorable and unfavorable leasehold interests were netted against the lease assets. At transition, we elected the package of practical expedients, which allows us to carry forward the historical lease classification and not reassess whether any expired or existing contracts are leases or contain leases. We did not elect the use of hindsight to determine the term of our leases at transition.

A lease liability for new leases is recorded based on the present value of future fixed lease commitments with a corresponding lease asset. For leases classified as operating leases, we recognize a single lease cost on a straight-line basis based on the combined amortization of the lease liability and the lease asset. Other leases will be accounted for as finance arrangements. For real estate leases, we are generally required to pay base rent, real estate taxes, and insurance, which are considered lease components, and maintenance, which is a non-lease component. As provided for under ASU 2016-02, we have elected to not separate non-lease payment components from the associated lease component for all new real estate leases. We determine the discount rate for each lease by estimating the rate that we would be required to pay on a secured borrowing for an amount equal to the lease payments over the lease term.

Prior to the adoption of ASU 2016-02, we recognized rent expense on a straight-line basis over the noncancelable terms of the lease. For leases with fixed increases of the minimum rentals during the noncancelable term, we recorded the difference between the amounts charged to expense and the rent paid as deferred rent and amortized such deferred rent upon the delivery of the lease location by the lessor. In addition, cash allowances received from landlords were deferred and amortized on a straight-line basis over the noncancelable terms of the lease as a reduction of rent expense. Deferred rent and construction and tenant allowances are included in non-current liabilities on the condensed consolidated balance sheets for periods prior to February 3, 2019. Also, we recorded reserves for leased spaces that were abandoned due to closure. Using a credit-adjusted risk-free rate to calculate the present value of the liability, we estimated future lease obligations based on remaining fixed lease payments, estimated or actual sublease income, and any other relevant factors.

Adoption of ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software- Also during the first quarter of fiscal 2019, we early adopted ASU 2018-15 on a prospective basis, which aligned the requirements for capitalizing implementation costs incurred in a cloud computing arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or acquire internal-use software. The adoption of ASU 2018-15 did not have a material impact on our condensed consolidated financial statements.

Revenue from Contract with Customer [Policy Text Block]

Deferred Revenue Liabilities- We record deferred revenue liabilities, included in accrued expenses on the condensed consolidated balance sheets, for remaining obligations we have to our customers.

Earnings Per Share, Policy

Basic earnings (loss) per share is based on net income (loss) and the weighted average of Class A and Class B common shares outstanding. Diluted earnings (loss) per share reflects the potential dilution of common shares adjusted for outstanding stock options, restricted stock units ("RSUs"), and performance-based restricted stock units ("PSUs") calculated using the treasury stock method.

Stockholders' Equity, Policy

Shares- Our Class A common shares are listed for trading under the ticker symbol "DBI" on the New York Stock Exchange. There is currently no public market for the Company's Class B common shares, but the Class B common shares can be exchanged for the Company's Class A common shares at the election of the holder on a share for share basis. Holders of Class A common shares are entitled to one vote per share and holders of Class B common shares are entitled to eight votes per share on matters submitted to shareholders for approval.

Repurchase and Resale Agreements Policy

Share Repurchases- On August 17, 2017, the Board of Directors authorized the repurchase of an additional $500 million of Class A common shares under our share repurchase program, which was added to the $33.5 million remaining from the previous authorization. During the six months ended August 3, 2019, we repurchased 6.1 million Class A common shares at a cost of $125.0 million, with $351.6 million of Class A common shares that remain authorized under the program as of August 3, 2019. During the six months ended August 4, 2018, we did not repurchase any Class A common shares. The share repurchase program may be suspended, modified or discontinued at any time, and we have no obligation to repurchase any amount of our common shares under the program. Shares will be repurchased in the open market at times and in amounts considered appropriate based on price and market conditions.

Segment Reporting

Our three reportable segments, which are also operating segments, are the U.S. Retail segment, the Canada Retail segment, and the Brand Portfolio segment. All other operating segments are below the quantitative and qualitative thresholds for reportable segments and are aggregated into Other for segment reporting purposes.

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Significant Accounting Policies (Tables)

6 Months Ended

Aug. 03, 2019

Accounting Policies [Abstract]

Reconciliation of Cash and Cash Equivalents and Restricted Cash

The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows:

(in thousands)	August 3, 2019		February 2, 2019		August 4, 2018
Cash and cash equivalents	$	51,762	$	99,369	$	215,996
Restricted cash, included in prepaid expenses and other current assets	—		1,199		—
Total cash, cash equivalents, and restricted cash shown in the condensed consolidated statements of cash flows	$	51,762	$	100,568	$	215,996

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Acquisitions and Equity Method Investment (Tables)

6 Months Ended

Aug. 03, 2019

Business Acquisition [Line Items]

Equity Method Investments

Activity related to our equity investment in ABG-Camuto was as follows:

(in thousands)	Six Months Ended August 3, 2019
Balance at beginning of period	$	58,125
Share of net earnings	4,692
Distributions received	(7,784		)
Balance at end of period	$	55,033

Business Acquisition, Pro Forma Information

The following table provides the supplemental pro forma total revenue and net loss of the combined entity had the acquisition dates of TSL and Camuto Group and the investment in ABG-Camuto been the first day of our fiscal 2017:

(in thousands)	Three months ended August 4, 2018			Six months ended August 4, 2018
Total revenue	$	886,780		$	1,755,210
Net loss	$	(45,722	)	$	(33,131	)

Canada Retail [Member]

Business Acquisition [Line Items]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The purchase price and the allocation of the total consideration to the fair values of the assets and liabilities acquired was finalized as of February 2, 2019 and consisted of the following (in USD):

(in thousands)	Final Purchase Price and Allocation
Purchase price:
Cash consideration, net of cash acquired	$	28,152
Replacement stock-based awards attributable to pre-acquisition services	196
Fair value of previously held assets	92,242
	$	120,590
Fair value of assets and liabilities acquired:
Inventories	$	66,072
Other current assets	3,687
Property and equipment	41,008
Goodwill	43,022
Intangible assets	20,689
Accounts payable and accrued expenses	(33,196		)
Non-current liabilities	(20,692		)
	$	120,590

Camuto LLC

Business Acquisition [Line Items]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table summarizes the preliminary and revised purchase price and the allocation of the total consideration to the fair values of the assets and liabilities acquired:

(in thousands)	Preliminary Purchase Price and Allocation as of November 5, 2018			Measurement Period Adjustments			Revised Purchase Price and Allocation as of August 3, 2019
Purchase price -
Cash consideration, net of cash acquired	$	171,251		$	—		$	171,251
Fair value of assets and liabilities acquired:
Accounts receivable	$	83,939		$	3,980		$	87,919
Inventories	74,499			(758		)	73,741
Other current assets	7,197			1,045			8,242
Property and equipment	43,906			960			44,866
Goodwill	63,614			26,767			90,381
Intangible asset	27,000			(21,700		)	5,300
Other assets	13,351			—			13,351
Accounts payable and other liabilities	(122,811		)	(2,195		)	(125,006		)
Non-current liabilities	(19,444		)	(8,099		)	(27,543		)
	$	171,251		$	—		$	171,251

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Revenue (Tables)

6 Months Ended

Aug. 03, 2019

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following table presents our total revenue disaggregated by segments:

	Three months ended					Six months ended
(in thousands)	August 3, 2019			August 4, 2018		August 3, 2019			August 4, 2018
Segment net sales:
U.S. Retail	$	677,920		$	691,757	$	1,369,760		$	1,361,541
Canada Retail	63,306			72,532		115,122			72,532
Brand Portfolio	95,422			—		196,289			—
Other	29,480			29,446		65,087			70,099
Total net sales	866,128			793,735		1,746,258			1,504,172
Commission, franchise and other revenue	11,771			1,533		20,676			3,198
	877,899			795,268		1,766,934			1,507,370
Elimination of intersegment revenue	(17,701		)	—		(28,221		)	—
Total revenue	$	860,198		$	795,268	$	1,738,713		$	1,507,370

The following table presents total revenue by product and service category:

	Three months ended					Six months ended
(in thousands)	August 3, 2019			August 4, 2018		August 3, 2019			August 4, 2018
Net sales:
U.S. Retail segment:
Women's footwear	$	458,390		$	467,337	$	940,511		$	936,621
Men's footwear	140,895			151,573		269,884			284,732
Accessories, kids and other	78,635			72,847		159,365			140,188
	677,920			691,757		1,369,760			1,361,541
Canada Retail segment:
Women's footwear	35,533			42,067		64,159			42,067
Men's footwear	16,432			19,455		29,440			19,455
Accessories, kids and other	11,341			11,010		21,523			11,010
	63,306			72,532		115,122			72,532
Brand Portfolio segment:
Wholesale	88,577			—		180,331			—
Direct-to-consumer	6,845			—		15,958			—
	95,422			—		196,289			—
Other	29,480			29,446		65,087			70,099
Total net sales	866,128			793,735		1,746,258			1,504,172
Commission, franchise and other revenue	11,771			1,533		20,676			3,198
	877,899			795,268		1,766,934			1,507,370
Elimination of intersegment revenue	(17,701		)	—		(28,221		)	—
Total revenue	$	860,198		$	795,268	$	1,738,713		$	1,507,370

Deferred Revenue

The following table presents the changes and total balances for gift cards and our loyalty programs:

	Three months ended						Six months ended
(in thousands)	August 3, 2019			August 4, 2018			August 3, 2019			August 4, 2018
Gift cards:
Beginning of period	$	30,066		$	28,151		$	34,998		$	32,792
Gift cards redeemed and breakage recognized to net sales	(21,843		)	(21,761		)	(44,098		)	(44,034		)
Gift cards issued	20,054			20,401			37,377			38,033
End of period	$	28,277		$	26,791		$	28,277		$	26,791
Loyalty programs:
Beginning of period	$	16,153		$	22,111		$	16,151		$	21,282
Loyalty certificates redeemed and expired and other adjustments recognized to net sales	(9,507		)	(16,750		)	(18,828		)	(23,385		)
Deferred revenue for loyalty points issued	9,388			11,425			18,711			18,889
End of period	$	16,034		$	16,786		$	16,034		$	16,786

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Earnings (Loss) Per Share (Tables)

6 Months Ended

Aug. 03, 2019

Earnings Per Share [Abstract]

Reconciliation of the Number of Shares Used in the Calculation of Diluted Earnings per Share

The following is a reconciliation of the number of shares used in the calculation of earnings (loss) per share:

	Three months ended		Six months ended
(in thousands)	August 3, 2019	August 4, 2018	August 3, 2019	August 4, 2018
Weighted average basic shares outstanding	73,529	80,265	75,267	80,187
Dilutive effect of stock-based compensation awards	787	—	1,014	—
Weighted average diluted shares outstanding	74,316	80,265	76,281	80,187

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Stock-Based Compensation (Tables)

6 Months Ended

Aug. 03, 2019

Share-based Payment Arrangement [Abstract]

Schedule of Share-based Compensation Expense

Stock-based compensation expense consisted of the following:

	Three months ended				Six months ended
(in thousands)	August 3, 2019		August 4, 2018		August 3, 2019		August 4, 2018
Stock options	$	563	$	1,343	$	1,386	$	3,138
Restricted and director stock units	4,798		3,841		8,345		6,560
	$	5,361	$	5,184	$	9,731	$	9,698

Stock Option Plan Activity

The following table summarizes the stock-based compensation award activity for the six months ended August 3, 2019:

	Number of shares
(in thousands)	Stock Options		Time-Based RSUs		Performance-Based RSUs
Outstanding - beginning of period	4,001		989		596
Granted	—		841		358
Exercised / vested	(99	)	(111	)	(97	)
Forfeited / expired	(38	)	(56	)	—
Outstanding - end of period	3,864		1,663		857

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Shareholders' Equity (Tables)

6 Months Ended

Aug. 03, 2019

Accumulated Other Comprehensive Income (Loss) [Line Items]

Schedule of Stock by Class

The following table provides additional information for our common shares:

	August 3, 2019		February 2, 2019		August 4, 2018
(in thousands)	Class A	Class B	Class A	Class B	Class A	Class B
Authorized shares	250,000	100,000	250,000	100,000	250,000	100,000
Issued shares	86,080	7,733	85,763	7,733	85,652	7,733
Outstanding shares	64,911	7,733	70,672	7,733	72,561	7,733
Treasury shares	21,169	—	15,091	—	13,091	—

Schedule of Accumulated Other Comprehensive Income (Loss)

Changes for the balances of each component of accumulated other comprehensive loss were as follows (all amounts are net of tax):

	Three months ended
	August 3, 2019									August 4, 2018
(in thousands)	Foreign Currency Translation			Available-for-Sale Securities			Total			Foreign Currency Translation			Available-for-Sale Securities			Total
Accumulated other comprehensive loss - beginning of period	$	(3,042	)	$	(224	)	$	(3,266	)	$	(12,218	)	$	(980	)	$	(13,198	)
Other comprehensive income (loss) before reclassifications	461			196			657			(1,365		)	27			(1,338		)
Amounts reclassified to non-operating income (expenses), net	—			23			23			12,218			42			12,260
Other comprehensive income	461			219			680			10,853			69			10,922
Accumulated other comprehensive loss - end of period	$	(2,581	)	$	(5	)	$	(2,586	)	$	(1,365	)	$	(911	)	$	(2,276	)

	Six months ended
	August 3, 2019									August 4, 2018
(in thousands)	Foreign Currency Translation			Available-for-Sale Securities			Total			Foreign Currency Translation			Available-for-Sale Securities			Total
Accumulated other comprehensive loss - beginning of period	$	(2,328	)	$	(378	)	$	(2,706	)	$	(9,278	)	$	(796	)	$	(10,074	)
Other comprehensive income (loss) before reclassifications	(253		)	438			185			(6,050		)	(317		)	(6,367		)
Amounts reclassified to non-operating expenses, net	—			(65		)	(65		)	13,963			202			14,165
Other comprehensive income (loss)	(253		)	373			120			7,913			(115		)	7,798
Accumulated other comprehensive loss - end of period	$	(2,581	)	$	(5	)	$	(2,586	)	$	(1,365	)	$	(911	)	$	(2,276	)

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Accounts Receivable (Tables)

6 Months Ended

Aug. 03, 2019

Accounts Receivable [Abstract]

Schedule of Accounts Receivable, Net

Accounts receivable, net, consisted of the following:

(in thousands)	August 3, 2019			February 2, 2019			August 4, 2018
Customer accounts receivables:
Serviced by third-party provider with guaranteed payment	$	61,494		$	47,599		$	—
Serviced by third-party provider without guaranteed payment	495			280			—
Serviced in-house	10,145			9,892			3,090
Construction and tenant allowance receivables due from landlords(1)	—			4,034			5,201
Other receivables	14,460			8,004			8,968
Accounts receivable	86,594			69,809			17,259
Allowance for doubtful accounts	(1,432		)	(939		)	—
Accounts receivable, net	$	85,162		$	68,870		$	17,259

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Investments (Tables)

6 Months Ended

Aug. 03, 2019

Investments [Abstract]

Available-for-sale Securities

Investments in available-for-sale securities consisted of the following:

(in thousands)	August 3, 2019			February 2, 2019			August 4, 2018
Carrying value of investments	$	25,510		$	70,195		$	73,978
Unrealized gains included in accumulated other comprehensive loss	18			44			10
Unrealized losses included in accumulated other comprehensive loss	(24		)	(521		)	(869		)
Fair value	$	25,504		$	69,718		$	73,119

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Property and Equipment (Tables)

6 Months Ended

Aug. 03, 2019

Property, Plant and Equipment [Abstract]

Property and Equipment

Property and equipment consisted of the following:

(in thousands)	August 3, 2019			February 2, 2019			August 4, 2018
Land	$	1,110		$	1,110		$	1,110
Buildings	13,445			12,485			12,485
Building and leasehold improvements	440,425			437,116			425,651
Furniture, fixtures and equipment	489,805			487,494			451,040
Software	183,226			161,226			145,111
Construction in progress(1)	41,454			38,646			46,643
Total property and equipment	1,169,465			1,138,077			1,082,040
Accumulated depreciation and amortization	(766,686		)	(728,501		)	(694,419		)
Property and equipment, net	$	402,779		$	409,576		$	387,621

(1)

Construction in progress is comprised primarily of the construction of leasehold improvements and furniture and fixtures related to unopened stores and internal-use software under development.

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Goodwill and Intangible Assets (Tables)

6 Months Ended

Aug. 03, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of goodwill

Activity related to our goodwill was as follows:

	Six months ended
	August 3, 2019								August 4, 2018
(in thousands)	Goodwill			Accumulated Impairments			Net		Goodwill			Accumulated Impairments			Net
Beginning of period by segment:
U.S. Retail	$	25,899		$	—		$	25,899	$	25,899		$	—		$	25,899
Canada Retail	42,048			(42,048		)	—		—			—			—
Brand Portfolio	63,614			—			63,614		—			—			—
Other	—			—			—		53,790			(53,790		)	—
	131,561			(42,048		)	89,513		79,689			(53,790		)	25,899
Activity by segment:
Canada Retail:
Acquired TSL goodwill	—			—			—		37,044			—			37,044
Impairment charges	—			—			—		—			(36,240		)	(36,240		)
Currency translation adjustment	(416		)	416			—		(580		)	(224		)	(804		)
Brand Portfolio -
Purchase price and allocation adjustments	26,767			—			26,767		—			—			—
Other - Eliminated goodwill from Ebuys exit	—			—			—		(53,790		)	53,790			—
	26,351			416			26,767		(17,326		)	17,326			—
End of period by segment:
U.S. Retail	25,899			—			25,899		25,899			—			25,899
Canada Retail	41,632			(41,632		)	—		36,464			(36,464		)	—
Brand Portfolio	90,381			—			90,381		—			—			—
	$	157,912		$	(41,632	)	$	116,280	$	62,363		$	(36,464	)	$	25,899

Schedule of finite-lived intangible assets

Intangible assets consisted of the following:

(in thousands)	Cost		Accumulated Amortization			Net
August 3, 2019
Definite-lived customer relationships	$	6,661	$	(1,064	)	$	5,597
Indefinite-lived trademarks and tradenames	15,515		—			15,515
	$	22,176	$	(1,064	)	$	21,112
February 2, 2019
Definite-lived:
Customer relationships	$	28,375	$	(1,010	)	$	27,365
Favorable leasehold interests	3,513		(295		)	3,218
Indefinite-lived trademarks and tradenames	15,546		—			15,546
	$	47,434	$	(1,305	)	$	46,129
August 4, 2018
Definite-lived:
Customer relationships	$	1,378	$	(114	)	$	1,264
Favorable leasehold interests	3,522		(101		)	3,421
Indefinite-lived trademarks and tradenames	15,600		—			15,600
	$	20,500	$	(215	)	$	20,285

Schedule of indefinite-lived intangible assets

Intangible assets consisted of the following:

(in thousands)	Cost		Accumulated Amortization			Net
August 3, 2019
Definite-lived customer relationships	$	6,661	$	(1,064	)	$	5,597
Indefinite-lived trademarks and tradenames	15,515		—			15,515
	$	22,176	$	(1,064	)	$	21,112
February 2, 2019
Definite-lived:
Customer relationships	$	28,375	$	(1,010	)	$	27,365
Favorable leasehold interests	3,513		(295		)	3,218
Indefinite-lived trademarks and tradenames	15,546		—			15,546
	$	47,434	$	(1,305	)	$	46,129
August 4, 2018
Definite-lived:
Customer relationships	$	1,378	$	(114	)	$	1,264
Favorable leasehold interests	3,522		(101		)	3,421
Indefinite-lived trademarks and tradenames	15,600		—			15,600
	$	20,500	$	(215	)	$	20,285

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Accrued Expenses (Tables)

6 Months Ended

Aug. 03, 2019

Payables and Accruals [Abstract]

Accrued Expenses

Accrued expenses consisted of the following:

(in thousands)	August 3, 2019		February 2, 2019		August 4, 2018
Gift cards and merchandise credits	$	28,277	$	34,998	$	26,791
Accrued compensation and related expenses	38,532		53,577		30,224
Accrued taxes	18,330		16,491		21,029
Loyalty programs deferred revenue	16,034		16,151		16,786
Sales returns	19,332		17,743		14,426
Customer allowances and discounts	9,306		13,094		—
Other(1)	43,626		49,481		36,520
	$	173,437	$	201,535	$	145,776

(1)

Other is comprised of various other accrued expenses that we expect will settle within one year of the applicable period.

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Other Non-Current Liabilities (Tables)

6 Months Ended

Aug. 03, 2019

Other Liabilities Disclosure [Abstract]

Other Non-current Liabilities

Other non-current liabilities consisted of the following:

(in thousands)	August 3, 2019		February 2, 2019		August 4, 2018
Foreign tax contingent liabilities	$	14,807	$	13,429	$	—
Deferred tax liabilities	3,393		3,260		—
Construction and tenant allowances(1)	—		71,634		75,439
Deferred rent(1)	—		35,934		35,694
Accrual for lease obligations(1)	—		16,483		9,511
Unfavorable leasehold interests(1)	—		5,779		7,000
Other(2)	20,390		18,528		22,672
	$	38,590	$	165,047	$	150,316

Schedule of Restructuring Reserve by Type of Cost

The following table presents the changes and total balances for the accrual for lease obligations:

	Six months ended
(in thousands)	August 3, 2019			August 4, 2018
Beginning of period	$	16,483		$	6,511
Netted against lease assets upon transition to ASU 2016-02	(16,483		)	—
Additions	—			4,884
Lease obligation payments, net of sublease income	—			(2,004		)
Adjustments	—			120
End of period	$	—		$	9,511

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Leases (Tables)

6 Months Ended

Aug. 03, 2019

Leases [Abstract]

Lease, Cost

Lease income and lease expense consisted of the following for the three and six months ended August 3, 2019 (after the adoption of ASU 2016-02) and August 4, 2018 (prior to the adoption of ASU 2016-02):

	Three months ended				Six months ended
(in thousands)	August 3, 2019		August 4, 2018		August 3, 2019		August 4, 2018
Operating lease income	$	2,236	$	1,149	$	4,448	$	2,297
Operating lease expense:
Lease expense to unrelated parties	$	52,707	$	51,263	$	106,061	$	96,748
Lease expense to related parties	2,371		2,303		4,713		4,591
Variable lease expense to unrelated parties	12,981		5,675		26,003		12,498
Variable lease expense to related parties	348		—		650		—
	$	68,407	$	59,241	$	137,427	$	113,837

	August 3, 2019
Other operating lease information:
Weighted-average remaining lease term	6.3 years
Weighted-average discount rate	3.9	%

Schedule of Future Fixed Minimum Lease Payments

As of August 3, 2019, our future fixed minimum lease payments are as follows:

(in thousands)	Unrelated Parties			Related Parties			Total
Remainder of fiscal 2019	$	96,844		$	3,937		$	100,781
Fiscal 2020	233,961			9,364			243,325
Fiscal 2021	216,107			8,697			224,804
Fiscal 2022	182,432			7,418			189,850
Fiscal 2023	142,408			4,573			146,981
Future fiscal years thereafter	314,601			15,493			330,094
	1,186,353			49,482			1,235,835
Less discounting impact on operating leases	(138,305		)	(6,015		)	(144,320		)
Total operating lease liabilities	1,048,048			43,467			1,091,515
Less current operating lease liabilities	(178,091		)	(7,878		)	(185,969		)
Non-current operating lease liabilities	$	869,957		$	35,589		$	905,546

Schedule of Future Minimum Rental Payments for Operating Leases

As of February 2, 2019, future minimum lease payment requirements, excluding contingent rental payments, maintenance, insurance, real estate taxes, and the amortization of deferred rent and construction and tenant allowances, consisted of the following, as determined prior to the adoption of ASU 2016-02:

(in thousands)	Unrelated Parties		Related Parties		Total
Fiscal 2019	$	233,237	$	9,425	$	242,662
Fiscal 2020	227,001		9,364		236,365
Fiscal 2021	204,803		8,697		213,500
Fiscal 2022	170,030		6,518		176,548
Fiscal 2023	131,594		1,874		133,468
Future fiscal years thereafter	298,437		5,596		304,033
	$	1,265,102	$	41,474	$	1,306,576

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Segment Reporting (Tables)

6 Months Ended

Aug. 03, 2019

Segment Reporting [Abstract]

Segment Information

The following provides certain financial data by segment reconciled to the condensed consolidated financial statements:

(in thousands)	U.S. Retail		Canada Retail		Brand Portfolio		Other		Corporate/Eliminations			Total
Three months ended August 3, 2019
External revenue:
Net sales	$	677,920	$	63,306	$	78,934	$	29,480	$	—		$	849,640
Commission, franchise and other revenue	—		—		6,312		—		4,246			10,558
Total revenue	$	677,920	$	63,306	$	85,246	$	29,480	$	4,246		$	860,198
Intersegment revenue	$	—	$	—	$	17,701	$	—	$	(17,701	)	$	—
Gross profit(1)	$	208,056	$	21,939	$	19,261	$	6,041	$	(436	)	$	254,861
Income from equity investment in ABG-Camuto	$	—	$	—	$	2,464	$	—	$	—		$	2,464
Three months ended August 4, 2018
Revenue:
Net sales	$	691,757	$	72,532	$	—	$	29,446	$	—		$	793,735
Commission, franchise and other revenue	—		—		—		—		1,533			1,533
Total revenue	$	691,757	$	72,532	$	—	$	29,446	$	1,533		$	795,268
Gross profit(1)	$	229,601	$	18,218	$	—	$	6,676	$	—		$	254,495
Six months ended August 3, 2019
External revenue:
Net sales	$	1,369,760	$	115,122	$	169,663	$	65,087	$	—		$	1,719,632
Commission, franchise and other revenue	—		—		9,609		—		9,472			19,081
Total revenue	$	1,369,760	$	115,122	$	179,272	$	65,087	$	9,472		$	1,738,713
Intersegment revenue	$	—	$	—	$	28,221	$	—	$	(28,221	)	$	—
Gross profit(1)	$	417,947	$	37,686	$	41,255	$	15,352	$	(1,343	)	$	510,897
Income from equity investment in ABG-Camuto	$	—	$	—	$	4,692	$	—	$	—		$	4,692
Six months ended August 4, 2018
Revenue:
Net sales	$	1,361,541	$	72,532	$	—	$	70,099	$	—		$	1,504,172
Commission, franchise and other revenue	—		—		—		—		3,198			3,198
Total revenue	$	1,361,541	$	72,532	$	—	$	70,099	$	3,198		$	1,507,370
Gross profit(1)	$	427,945	$	18,218	$	—	$	13,557	$	—		$	459,720

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Significant Accounting Policies (Details) $ in Thousands	3 Months Ended	6 Months Ended
	Aug. 03, 2019 USD ($) joint_venture	Aug. 03, 2019 USD ($) segment	Aug. 04, 2018 USD ($)	Feb. 03, 2019 USD ($)	Feb. 02, 2019 USD ($)	Nov. 05, 2018	Feb. 03, 2018 USD ($)
Number of reportable segments | segment		3
Number of joint ventures terminated | joint_venture	2
Severance Costs		$ 3,600	$ 2,700
Loss on Contract Termination		6,100
Business Combination, Integration Related Costs		2,400
Supplemental Unemployment Benefits, Severance Benefits	$ 4,600	$ 4,600	$ 1,600
Effective income tax rate reconciliation, percent		27.90%	203.30%
Cash and cash equivalents	51,762	$ 51,762	$ 215,996		$ 99,369
Restricted Cash and Cash Equivalents	0	0	0		1,199
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents	51,762	51,762	215,996		100,568		$ 175,932
Operating lease assets	975,963	975,963	$ 0	$ 1,000,000	0
Business combination, recognized identifiable assets acquired and liabilities assumed, capital lease obligation	$ 1,091,515	$ 1,091,515		1,100,000
Lease assets				$ 9,600	$ 9,556
ABG-Camuto, LLC
Noncontrolling Interest in joint ventures						40.00%

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Acquisitions and Equity Method Investment (Details) $ in Thousands, $ in Millions				3 Months Ended			6 Months Ended		12 Months Ended
	Nov. 05, 2018 USD ($)	May 10, 2018 USD ($)	May 10, 2018 CAD ($)	Aug. 03, 2019 USD ($)	Feb. 02, 2019 USD ($)	Aug. 04, 2018 USD ($)	Aug. 03, 2019 USD ($)	Aug. 04, 2018 USD ($)	Feb. 02, 2019 USD ($)	Feb. 03, 2018 USD ($)
Business Acquisition [Line Items]
Payments to acquire businesses, net of acquired cash							$ 0	$ 28,152
Foreign currency translation gain (loss)				$ 461		$ (1,365)	(253)	(6,050)
Off-market lease, unfavorable				0	$ (5,779)	(7,000)	0	(7,000)	$ (5,779)
Purchase price:
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustment, Consideration Transferred				0
Fair value of assets and liabilities acquired:
Business Combination Provisional Information Initial Accounting Incomplete Adjustment, Accounts Receivable				3,980
Acquired TSL goodwill				116,280	89,513	25,899	116,280	25,899	89,513	$ 25,899
Impairment charges							26,767	0
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustment, Intangibles				(21,700)
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustment, Non-Current Assets, Other				0
Net sales				860,198		795,268	1,738,713	1,507,370
Net income (loss)				27,407		(38,356)	58,601	(14,059)
Impairment charges				0		36,240	0	36,240
Lease exit non-cash charges							0	3,910
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Contingent Liability				12,700			12,700
Equity investment in ABG-Camuto				55,033	58,125	0	55,033	0	58,125
Business Acquisition, Pro Forma Information [Abstract]
Business acquisition, pro forma revenue						886,780		1,755,210
Business acquisition, pro forma net income (loss)						(45,722)		(33,131)
Canada Retail
Fair value of assets and liabilities acquired:
Acquired TSL goodwill				0	0	0	0	0	0	$ 0
Net sales								72,500
Product
Fair value of assets and liabilities acquired:
Net sales				849,640		793,735	1,719,632	1,504,172
Product | Canada Retail
Fair value of assets and liabilities acquired:
Net sales				63,306			115,122
Non-current Liabilities
Business Acquisition [Line Items]
Off-market lease, unfavorable				(7,600)			(7,600)
Operating Expense [Member] | Canada Retail
Fair value of assets and liabilities acquired:
Business combination, acquisition related costs									3,100
Operating Expense [Member] | Camuto LLC
Fair value of assets and liabilities acquired:
Business combination, acquisition related costs									22,200
ABG-Camuto, LLC
Fair value of assets and liabilities acquired:
Noncontrolling Interest in joint ventures	40.00%
Business combination, acquisition of less than 100 percent, noncontrolling interest, fair value	$ 56,800
Equity investment in ABG-Camuto				55,033	58,125		55,033		58,125
Income (Loss) from Equity Method Investments, Net of Dividends or Distributions							4,692
Proceeds from Equity Method Investment, Distribution							(7,784)
Canada Retail [Member]
Business Acquisition [Line Items]
Payments to acquire businesses, net of acquired cash		$ 28,200	$ 36.2
Cash acquired from acquisition		6,600	$ 8.5
Other comprehensive income (loss), foreign currency transaction and translation adjustment, net of tax						(12,200)
Finite-lived intangible asset, off-market lease, favorable, gross				3,600			3,600
Purchase price:
Cash consideration, net of cash acquired		28,152
Replacement stock-based awards attributable to pre-acquisition services		196
Fair value of previously held assets		92,242
Business combination, consideration transferred, including equity interest in acquiree held prior to combination		120,590
Fair value of assets and liabilities acquired:
Inventories		66,072
Other current assets		3,687
Property and equipment		41,008
Acquired TSL goodwill		43,022
Intangible assets		20,689
Accounts payable and accrued expenses		(33,196)
Non-current liabilities		(20,692)
Fair value of assets and liabilities acquired		$ 120,590
Canada Retail [Member] | Tradename
Business Acquisition [Line Items]
Finite-lived trade names, gross				15,700			15,700
Canada Retail [Member] | Customer Relationships
Business Acquisition [Line Items]
Finite-lived trade names, gross				1,400			1,400
Canada Retail [Member] | Canada Retail
Fair value of assets and liabilities acquired:
Net income (loss)								$ (38,500)
Canada Retail [Member] | Nonoperating Income (Expense)
Business Acquisition [Line Items]
Foreign currency translation gain (loss)						$ (34,000)
Camuto LLC
Business Acquisition [Line Items]
Payments to acquire businesses, net of acquired cash	171,300
Cash acquired from acquisition	9,700
Purchase price:
Cash consideration, net of cash acquired				171,251	171,251
Fair value of assets and liabilities acquired:
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables				87,919	83,939		87,919		83,939
Inventories				73,741	74,499		73,741		74,499
Inventories				(758)
Other current assets				8,242	7,197		8,242		7,197
Other current assets				1,045
Property and equipment				44,866	43,906		44,866		43,906
Property and equipment				960
Acquired TSL goodwill				90,381	63,614		90,381		63,614
Impairment charges				26,767
Intangible assets				5,300	27,000		5,300		27,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets				13,351	13,351		13,351		13,351
Accounts payable and accrued expenses				(125,006)	(122,811)		(125,006)		(122,811)
Accounts payable and accrued expenses				(2,195)
Non-current liabilities				(27,543)	(19,444)		(27,543)		(19,444)
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustment, Financial Liabilities				(8,099)
Fair value of assets and liabilities acquired				$ 171,251	$ 171,251		$ 171,251		$ 171,251
Business Acquisition, Pro Forma Information [Abstract]
Borrowings on the revolving line of credit used to fund acquisition	$ 160,000

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Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Aug. 03, 2019	Aug. 04, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	$ 860,198	$ 795,268	$ 1,738,713	$ 1,507,370
Gift cards, Beginning of period	30,066	28,151	34,998	32,792
Gift cards, End of period	28,277	26,791	28,277	26,791
Loyalty programs, Beginning of period	16,153	22,111	16,151	21,282
Loyalty programs, End of period	16,034	16,786	16,034	16,786
Loyalty certificates redeemed and expired and other adjustments recognized to net sales
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Increase (decrease) in customer loyalty program liability	(9,507)	(16,750)	(18,828)	(23,385)
Deferred revenue for loyalty points issued
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Increase (decrease) in customer loyalty program liability	9,388	11,425	18,711	18,889
Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	849,640	793,735	1,719,632	1,504,172
Commission, franchise and other revenue
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	10,558	1,533	19,081	3,198
Gift cards redeemed and breakage recognized to net sales
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Increase (decrease) in gift card liability	(21,843)	(21,761)	(44,098)	(44,034)
Gift cards issued
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Increase (decrease) in gift card liability	20,054	20,401	37,377	38,033
Canada Retail
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales				72,500
Canada Retail | Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	63,306		115,122
Brand Portfolio | Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	78,934		169,663
Other | Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	29,480		65,087
Operating Segments
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	877,899	795,268	1,766,934	1,507,370
Operating Segments | Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	866,128	793,735	1,746,258	1,504,172
Operating Segments | Commission, franchise and other revenue
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	11,771	1,533	20,676	3,198
Operating Segments | U.S. Retail
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	677,920	691,757	1,369,760	1,361,541
Operating Segments | U.S. Retail | Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	677,920	691,757	1,369,760	1,361,541
Operating Segments | U.S. Retail | Women's footwear
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	458,390	467,337	940,511	936,621
Operating Segments | U.S. Retail | Men's footwear
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	140,895	151,573	269,884	284,732
Operating Segments | U.S. Retail | Accessories, kids and other
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	78,635	72,847	159,365	140,188
Operating Segments | Canada Retail
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	63,306	72,532	115,122	72,532
Operating Segments | Canada Retail | Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	63,306	72,532	115,122	72,532
Operating Segments | Canada Retail | Commission, franchise and other revenue
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	0	0	0	0
Operating Segments | Canada Retail | Women's footwear
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	35,533	42,067	64,159	42,067
Operating Segments | Canada Retail | Men's footwear
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	16,432	19,455	29,440	19,455
Operating Segments | Canada Retail | Accessories, kids and other
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	11,341	11,010	21,523	11,010
Operating Segments | Brand Portfolio
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	85,246	0	179,272	0
Operating Segments | Brand Portfolio | Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	95,422	0	196,289	0
Operating Segments | Brand Portfolio | Commission, franchise and other revenue
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	6,312	0	9,609	0
Operating Segments | Brand Portfolio | Wholesale
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	88,577	0	180,331	0
Operating Segments | Brand Portfolio | Direct-to-consumer
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	6,845	0	15,958	0
Operating Segments | Other
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	29,480	29,446	65,087	70,099
Operating Segments | Other | Product
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	29,480	29,446	65,087	70,099
Operating Segments | Other | Commission, franchise and other revenue
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	0	0	0	0
Intersegment Eliminations
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	(17,701)	$ 0	(28,221)	$ 0
Intersegment Eliminations | Canada Retail
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	0		0
Intersegment Eliminations | Brand Portfolio
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	17,701		28,221
Intersegment Eliminations | Other
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net sales	$ 0		$ 0

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Related Party Transactions (Details) - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Aug. 03, 2019	Aug. 04, 2018	Feb. 02, 2019	Nov. 05, 2018
Schottenstein Affiliates [Abstract]
Related party transaction outstanding common shares owned (in hundredths)	15.00%		15.00%
Related party transaction combined voting power of outstanding common shares (in hundredths)	51.00%		51.00%
Due to Related Parties, Current	$ 0.5	$ 0.5	$ 0.5	$ 0.5	$ 1.0
Class A common shares
Schottenstein Affiliates [Abstract]
Related party transaction, number of shares owned by related party (in shares)	3.4		3.4
Class B common shares
Schottenstein Affiliates [Abstract]
Related party transaction, number of shares owned by related party (in shares)	7.7		7.7
Schottenstein Affiliates
Schottenstein Affiliates [Abstract]
Related party transaction, purchases from related party	$ 1.5	$ 1.7	$ 3.4	$ 3.3
Royalty Arrangement [Member]
Schottenstein Affiliates [Abstract]
Due to Related Parties, Current					$ 2.4
Royalty Expense	$ 3.6		$ 9.3
ABG-Camuto, LLC
Schottenstein Affiliates [Abstract]
Noncontrolling Interest in joint ventures						40.00%

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Earnings (Loss) Per Share (Details) - shares shares in Thousands	3 Months Ended		6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Aug. 03, 2019	Aug. 04, 2018
Earnings Per Share [Abstract]
Weighted average basic shares outstanding	73,529	80,265	75,267	80,187
Dilutive effect of stock-based compensation awards	787	0	1,014	0
Weighted average diluted shares outstanding	74,316	80,265	76,281	80,187

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Earnings (Loss) Per Share Anti-Dilutive Securities (Details) - shares shares in Millions	3 Months Ended		6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Aug. 03, 2019	Aug. 04, 2018
Earnings Per Share [Abstract]
Securities outstanding not included in computation of diluted earnings per share	4.6	3.2	2.9	3.2

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Stock-Based Compensation - Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Aug. 03, 2019	Aug. 04, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 5,361	$ 5,184	$ 9,731	$ 9,698
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	563	1,343	1,386	3,138
Restricted and director stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 4,798	$ 3,841	$ 8,345	$ 6,560

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Stock-Based Compensation - Award Activity (Details) - shares shares in Thousands	3 Months Ended		6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Aug. 03, 2019	Aug. 04, 2018
Stock Option Activity [Roll Forward]
Exercised / vested	(145)	(91)	(317)	(267)
Stock Options
Stock Option Activity [Roll Forward]
Outstanding - beginning of period			4,001
Granted			0
Exercised / vested			(99)
Forfeited / expired			(38)
Outstanding - end of period	3,864		3,864
Time-Based RSUs
Stock Option Activity [Roll Forward]
Outstanding - beginning of period			989
Granted			841
Exercised / vested			(111)
Forfeited / expired			(56)
Outstanding - end of period	1,663		1,663
Performance-Based RSUs
Stock Option Activity [Roll Forward]
Outstanding - beginning of period			596
Granted			358
Exercised / vested			(97)
Forfeited / expired			0
Outstanding - end of period	857		857

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Stock-Based Compensation - Additional Information (Details) shares in Millions	Aug. 03, 2019 shares
Share-based Payment Arrangement [Abstract]
Number of shares available for future stock-based compensation grants	2.7

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Shareholders' Equity - Class of Stock (Details)				3 Months Ended	6 Months Ended
	Oct. 04, 2019	Sep. 20, 2019	Aug. 29, 2019 $ / shares	Aug. 03, 2019 USD ($) vote shares	Aug. 03, 2019 USD ($) vote shares	May 04, 2019 shares	Feb. 02, 2019 shares	Aug. 04, 2018 shares	May 05, 2018 shares	Feb. 03, 2018 shares	Aug. 17, 2017 USD ($)
Class of Stock [Line Items]
Preferred stock, shares authorized				100,000,000	100,000,000
Preferred stock, shares issued				0	0
Dividends payable, date declared					Aug. 29, 2019
Stock repurchase program, authorized amount | $											$ 500,000,000
Stock repurchase program, remaining authorized repurchase amount | $				$ 351,600,000	$ 351,600,000						$ 33,500,000
Stock repurchased during period, shares					(6,100,000)
Stock Repurchased During Period, Value | $				$ 50,000,000	$ 125,000,000.0
Class A common shares
Class of Stock [Line Items]
Common Stock, Voting Rights, Votes per Share | vote				1	1
Common stock, shares authorized (in shares)				250,000,000	250,000,000		250,000,000	250,000,000
Common stock, shares, issued (in shares)				86,080,000	86,080,000		85,763,000	85,652,000
Common stock, shares, outstanding (in shares)				64,911,000	64,911,000	67,434,000	70,672,000	72,561,000	72,470,000	72,294,000
Stock repurchased during period, shares				(2,668,000)	(6,078,000)
Class B common shares
Class of Stock [Line Items]
Common Stock, Voting Rights, Votes per Share | vote				8	8
Common stock, shares authorized (in shares)				100,000,000	100,000,000		100,000,000	100,000,000
Common stock, shares, issued (in shares)				7,733,000	7,733,000		7,733,000	7,733,000
Common stock, shares, outstanding (in shares)				7,733,000	7,733,000	7,733,000	7,733,000	7,733,000	7,733,000	7,733,000
Treasury shares
Class of Stock [Line Items]
Common stock, shares, outstanding (in shares)				21,169,000	21,169,000	18,501,000	15,091,000	13,091,000	13,091,000	13,091,000
Subsequent Event
Class of Stock [Line Items]
Dividends payable, date to be paid	Oct. 04, 2019
Dividends payable, date of record		Sep. 20, 2019
Subsequent Event | Class A common shares
Class of Stock [Line Items]
Common stock, dividends, per share, declared | $ / shares			$ 0.25
Subsequent Event | Class B common shares
Class of Stock [Line Items]
Common stock, dividends, per share, declared | $ / shares			$ 0.25

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Shareholders' Equity - Schedule of Accumulated Comprehensive Income (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Aug. 03, 2019	Aug. 04, 2018
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Accumulated other comprehensive loss - beginning of period	$ (3,266)	$ (13,198)	$ (2,706)	$ (10,074)
Other comprehensive loss before reclassifications	657	(1,338)	185	(6,367)
Amounts reclassified to non-operating expenses, net	23	12,260	(65)	14,165
Other comprehensive income (loss)	680	10,922	120	7,798
Accumulated other comprehensive loss - end of period	(2,586)	(2,276)	(2,586)	(2,276)
Foreign Currency Translation
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Accumulated other comprehensive loss - beginning of period	(3,042)	(12,218)	(2,328)	(9,278)
Other comprehensive loss before reclassifications	461	(1,365)	(253)	(6,050)
Amounts reclassified to non-operating expenses, net	0	12,218	0	13,963
Other comprehensive income (loss)	461	10,853	(253)	7,913
Accumulated other comprehensive loss - end of period	(2,581)	(1,365)	(2,581)	(1,365)
Available-for-Sale Securities
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Accumulated other comprehensive loss - beginning of period	(224)	(980)	(378)	(796)
Other comprehensive loss before reclassifications	196	27	438	(317)
Amounts reclassified to non-operating expenses, net	23	42	(65)	202
Other comprehensive income (loss)	219	69	373	(115)
Accumulated other comprehensive loss - end of period	$ (5)	$ (911)	$ (5)	$ (911)

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Accounts Receivable (Details) - USD ($) $ in Thousands	Aug. 03, 2019	Feb. 02, 2019	Aug. 04, 2018
Accounts Receivable [Abstract]
Accounts Receivable, Serviced by Third-Party Provider with Guaranteed Payment	$ 61,494	$ 47,599	$ 0
Accounts Receivable, Serviced by Third-Party Provider without Guaranteed Payment	495	280	0
Accounts Receivable, Serviced In-House	10,145	9,892	3,090
Lease Incentive Receivable	0	4,034	5,201
Other Receivables	14,460	8,004	8,968
Accounts Receivable, before Allowance for Credit Loss, Current	86,594	69,809	17,259
Accounts Receivable, Allowance for Credit Loss	(1,432)	(939)	0
Accounts Receivable, after Allowance for Credit Loss, Current	$ 85,162	$ 68,870	$ 17,259

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Investments (Details) - USD ($) $ in Thousands	Aug. 03, 2019	Feb. 02, 2019	Aug. 04, 2018
Investments [Abstract]
Carrying value of investments	$ 25,510	$ 70,195	$ 73,978
Unrealized gains included in accumulated other comprehensive loss	18	44	10
Unrealized losses included in accumulated other comprehensive loss	(24)	(521)	(869)
Fair value	$ 25,504	$ 69,718	$ 73,119

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Property and Equipment (Details) - USD ($) $ in Thousands	Aug. 03, 2019	Feb. 02, 2019	Aug. 04, 2018
Property and equipment [Abstract]:
Land	$ 1,110	$ 1,110	$ 1,110
Buildings	13,445	12,485	12,485
Building and leasehold improvements	440,425	437,116	425,651
Furniture, fixtures and equipment	489,805	487,494	451,040
Software	183,226	161,226	145,111
Construction in progress	41,454	38,646	46,643
Total property and equipment	1,169,465	1,138,077	1,082,040
Accumulated depreciation and amortization	(766,686)	(728,501)	(694,419)
Property and equipment, net	$ 402,779	$ 409,576	$ 387,621

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Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Aug. 03, 2019	Aug. 03, 2019	Aug. 04, 2018	Aug. 04, 2018
Goodwill [Roll Forward]
Goodwill, beginning of period		$ 131,561	$ 79,689
Accumulated Impairments, beginning of period		(42,048)	(53,790)
Net, end of period		89,513	25,899
Activity by segment:
Goodwill, purchase price and allocation adjustments		26,767	0
Goodwill, purchase price and allocation adjustments, accumulated impairments		0	0
Goodwill, purchase price and allocation adjustments, net		26,767	0
Activity during the period by segment		26,351	(17,326)
Accumulated Impairments, activity during the period		416	17,326
Goodwill, Period Increase (Decrease), Net		26,767	0
Goodwill, end of period	$ 157,912	157,912	62,363
Accumulated Impairments, end of period	(41,632)	(41,632)	(36,464)
Net, end of period	116,280	89,513	25,899	$ 25,899
U.S. Retail
Goodwill [Roll Forward]
Goodwill, beginning of period		25,899	25,899
Accumulated Impairments, beginning of period		0	0
Net, end of period		25,899	25,899
Activity by segment:
Goodwill, end of period	25,899	25,899	25,899
Accumulated Impairments, end of period	0	0	0
Net, end of period	25,899	25,899	25,899	25,899
Canada Retail
Goodwill [Line Items]
Goodwill, Acquired During Period		0	37,044
Goodwill, Impairment Loss		0	36,240
Goodwill [Roll Forward]
Goodwill, beginning of period		42,048	0
Accumulated Impairments, beginning of period		(42,048)	0
Net, end of period		0	0
Activity by segment:
Currency translation adjustment		(416)	(580)
Currency translation adjustment		416	(224)
Goodwill, foreign currency translation gain (loss), net		0	(804)
Goodwill, end of period	41,632	41,632	36,464
Accumulated Impairments, end of period	(41,632)	(41,632)	(36,464)
Net, end of period	0	0	0	0
Brand Portfolio
Goodwill [Roll Forward]
Goodwill, beginning of period		63,614	0
Accumulated Impairments, beginning of period		0	0
Net, end of period		63,614	0
Activity by segment:
Goodwill, end of period	90,381	90,381	0
Accumulated Impairments, end of period	0	0	0
Net, end of period	$ 90,381	63,614	0	$ 0
Other
Goodwill [Roll Forward]
Goodwill, beginning of period		0	53,790
Accumulated Impairments, beginning of period		0	(53,790)
Net, end of period		0	0
Activity by segment:
Other - Eliminated goodwill from Ebuys exit		0	(53,790)
Other - Eliminated goodwill from Ebuys exit		0	53,790
Net, end of period		$ 0	$ 0

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Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Feb. 02, 2019
Finite-lived Intangible Assets [Roll Forward]
Finite-lived intangible assets, period increase (decrease)	$ (1,064)	$ (215)	$ (1,305)
Indefinite-lived Intangible Assets [Roll Forward]
Indefinite-lived trademarks	15,515	15,600	15,546
Indefinite-lived intangible assets, period increase (decrease)	0	0	0
Intangible assets, gross (excluding goodwill)	22,176	20,500	47,434
Intangible assets	21,112	20,285	46,129
Customer Relationships
Finite-lived Intangible Assets [Roll Forward]
Finite-lived intangible assets, gross	6,661
Finite-lived intangible assets, period increase (decrease)	(1,064)
Finite-lived intangible assets, net	$ 5,597
Online retailer relationships
Finite-lived Intangible Assets [Roll Forward]
Finite-lived intangible assets, gross		1,378	28,375
Finite-lived intangible assets, period increase (decrease)		(114)	(1,010)
Finite-lived intangible assets, net		1,264	27,365
Tradename
Finite-lived Intangible Assets [Roll Forward]
Finite-lived intangible assets, gross		3,522	3,513
Finite-lived intangible assets, period increase (decrease)		(101)	(295)
Finite-lived intangible assets, net		$ 3,421	$ 3,218
Camuto LLC
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Remaining Amortization Period	8 years
Canada Retail
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Remaining Amortization Period	3 years

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Accrued Expenses (Details) - USD ($) $ in Thousands	Aug. 03, 2019	May 04, 2019	Feb. 02, 2019	Aug. 04, 2018	May 05, 2018	Feb. 03, 2018
Payables and Accruals [Abstract]
Gift cards and merchandise credits	$ 28,277	$ 30,066	$ 34,998	$ 26,791	$ 28,151	$ 32,792
Accrued compensation and related expenses	38,532		53,577	30,224
Accrued taxes	18,330		16,491	21,029
Loyalty programs deferred revenue	16,034	$ 16,153	16,151	16,786	$ 22,111	$ 21,282
Sales returns	19,332		17,743	14,426
Contract with Customer, Asset, Allowance for Credit Loss	9,306		13,094	0
Other	43,626		49,481	36,520
Total accrued expenses	$ 173,437		$ 201,535	$ 145,776

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Other Non-Current Liabilities (Details) - USD ($) $ in Thousands	6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Feb. 02, 2019
Summary Of Noncurrent Liabilities [Line Items]
Loss Contingency Accrual	$ 14,807	$ 0	$ 13,429
Deferred Tax Liabilities, Other	3,393	0	3,260
Incentive from Lessor	0	75,439	71,634
Deferred Rent Credit, Noncurrent	0	35,694	35,934
Off-market Lease, Unfavorable	0	7,000	5,779
Other Sundry Liabilities, Noncurrent	20,390	22,672	18,528
Total non-current liabilities	38,590	150,316	$ 165,047
Restructuring Reserve [Roll Forward]
Restructuring reserve, beginning balance	16,483	6,511
Restructuring reserve, ending balance	0	9,511
Netted against lease assets upon transition to ASU 2016-02
Restructuring Reserve [Roll Forward]
Restructuring Reserve, Period Increase (Decrease)	(16,483)	0
Additions
Restructuring Reserve [Roll Forward]
Restructuring Reserve, Period Increase (Decrease)	0	4,884
Lease obligation payments, net of sublease income
Restructuring Reserve [Roll Forward]
Restructuring Reserve, Period Increase (Decrease)	0	(2,004)
Adjustments
Restructuring Reserve [Roll Forward]
Restructuring Reserve, Period Increase (Decrease)	$ 0	$ 120

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Debt (Details)	Aug. 25, 2017	Aug. 03, 2019 USD ($)	Nov. 05, 2018 USD ($)
Debt Instrument [Line Items]
Line of credit facility, initiation date	Aug. 25, 2017
Line of credit facility, expiration date	Aug. 25, 2022
Line of credit facility, maximum borrowing capacity			$ 400,000,000
Letter of credit sublimits		$ 50,000,000
Swing loan advances		15,000,000
Foreign currency revolving loan		75,000,000
Long-term line of credit		235,000,000.0
Letters of credit outstanding, amount		1,300,000
Line of credit facility, remaining borrowing capacity		$ 163,700,000
Maximum leverage ratio	3.25	3.50
Minimum fixed charge coverage ratio	1.75
Credit Facility [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Interest Rate at Period End		4.10%
CAD Facility [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Interest Rate at Period End		1.70%

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Leases - Lease Income and Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 03, 2019	Aug. 04, 2018	Aug. 03, 2019	Aug. 04, 2018
Lessee, Lease, Description [Line Items]
Operating lease income	$ 2,236		$ 4,448
Operating lease income		$ 1,149		$ 2,297
Operating lease expense:
Operating lease expense	$ 68,407		$ 137,427
Operating Leases, Rent Expense, Net		59,241		113,837
Other operating lease information:
Weighted-average remaining lease term	6 years 3 months 18 days		6 years 3 months 18 days
Weighted-average discount rate	3.90%		3.90%
Lease expense to unrelated parties
Operating lease expense:
Lease expense	$ 52,707		$ 106,061
Operating Leases, Rent Expense, Minimum Rentals		51,263		96,748
Variable Lease, Cost	12,981		26,003
Operating Leases, Rent Expense, Contingent Rentals		5,675		12,498
Lease expense to related parties
Operating lease expense:
Lease expense	2,371		4,713
Operating Leases, Rent Expense, Minimum Rentals		2,303		4,591
Variable Lease, Cost	$ 348		$ 650
Operating Leases, Rent Expense, Contingent Rentals		$ 0		$ 0

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Leases - Future Fixed Minimum Lease Payments (Details) - USD ($) $ in Thousands	Aug. 03, 2019	Feb. 03, 2019	Feb. 02, 2019	Aug. 04, 2018
Lessee, Lease, Description [Line Items]
Remainder of fiscal 2019	$ 100,781
Fiscal 2020	243,325
Fiscal 2021	224,804
Fiscal 2022	189,850
Fiscal 2023	146,981
Future fiscal years thereafter	330,094
Future fixed minimum lease payments	1,235,835
Less discounting impact on operating leases	(144,320)
Total operating lease liabilities	1,091,515	$ 1,100,000
Less current operating lease liabilities	(185,969)		$ 0	$ 0
Non-current operating lease liabilities	905,546		$ 0	$ 0
Lease expense to unrelated parties
Lessee, Lease, Description [Line Items]
Remainder of fiscal 2019	96,844
Fiscal 2020	233,961
Fiscal 2021	216,107
Fiscal 2022	182,432
Fiscal 2023	142,408
Future fiscal years thereafter	314,601
Future fixed minimum lease payments	1,186,353
Less discounting impact on operating leases	(138,305)
Total operating lease liabilities	1,048,048
Less current operating lease liabilities	(178,091)
Non-current operating lease liabilities	869,957
Lease expense to related parties
Lessee, Lease, Description [Line Items]
Remainder of fiscal 2019	3,937
Fiscal 2020	9,364
Fiscal 2021	8,697
Fiscal 2022	7,418
Fiscal 2023	4,573
Future fiscal years thereafter	15,493
Future fixed minimum lease payments	49,482
Less discounting impact on operating leases	(6,015)
Total operating lease liabilities	43,467
Less current operating lease liabilities	(7,878)
Non-current operating lease liabilities	$ 35,589

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Leases - Narrative (Details) $ in Millions	Aug. 03, 2019 USD ($) store
Leases [Abstract]
Number of new stores	4
Number of store relocations	2
Operating lease liability, not yet commenced | $	$ 11.4

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Leases - Future Minimum Lease Payment Requirements (Details) $ in Thousands	Feb. 02, 2019 USD ($)
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
Fiscal 2019	$ 242,662
Fiscal 2020	236,365
Fiscal 2021	213,500
Fiscal 2022	176,548
Fiscal 2023	133,468
Future fiscal years thereafter	304,033
Operating Leases, Future Minimum Payments Due	1,306,576
Lease expense to unrelated parties
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
Fiscal 2019	233,237
Fiscal 2020	227,001
Fiscal 2021	204,803
Fiscal 2022	170,030
Fiscal 2023	131,594
Future fiscal years thereafter	298,437
Operating Leases, Future Minimum Payments Due	1,265,102
Lease expense to related parties
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
Fiscal 2019	9,425
Fiscal 2020	9,364
Fiscal 2021	8,697
Fiscal 2022	6,518
Fiscal 2023	1,874
Future fiscal years thereafter	5,596
Operating Leases, Future Minimum Payments Due	$ 41,474

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Commitments and Contingencies (Details) - USD ($) $ in Thousands	Aug. 03, 2019	Feb. 02, 2019	Aug. 04, 2018
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Loss Contingency Accrual	$ 14,807	$ 13,429	$ 0
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Contingent Liability	12,700
Guarantees, Fair Value Disclosure	15,000
Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Loss Contingency Accrual	14,800
Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Loss Contingency Accrual	$ 30,000

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Segment Reporting (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 03, 2019 USD ($)	Aug. 04, 2018 USD ($)	Aug. 03, 2019 USD ($) segment	Aug. 04, 2018 USD ($)
Segment Reporting Information [Line Items]
Number of reportable segments | segment			3
Segment information [Abstract]
Net sales	$ 860,198	$ 795,268	$ 1,738,713	$ 1,507,370
Gross profit(1)	254,861	254,495	510,897	459,720
Income (loss) from equity investments			4,692	(1,310)
Canada Retail
Segment information [Abstract]
Net sales				72,500
Product
Segment information [Abstract]
Net sales	849,640	793,735	1,719,632	1,504,172
Product | U.S. Retail
Segment information [Abstract]
Net sales	677,920		1,369,760
Product | Canada Retail
Segment information [Abstract]
Net sales	63,306		115,122
Product | Brand Portfolio
Segment information [Abstract]
Net sales	78,934		169,663
Product | Other
Segment information [Abstract]
Net sales	29,480		65,087
Commission, franchise and other revenue
Segment information [Abstract]
Net sales	10,558	1,533	19,081	3,198
Operating Segments
Segment information [Abstract]
Net sales	877,899	795,268	1,766,934	1,507,370
Operating Segments | U.S. Retail
Segment information [Abstract]
Net sales	677,920	691,757	1,369,760	1,361,541
Gross profit(1)	208,056	229,601	417,947	427,945
Operating Segments | Canada Retail
Segment information [Abstract]
Net sales	63,306	72,532	115,122	72,532
Gross profit(1)	21,939	18,218	37,686	18,218
Operating Segments | Brand Portfolio
Segment information [Abstract]
Net sales	85,246	0	179,272	0
Gross profit(1)	19,261	0	41,255	0
Operating Segments | Other
Segment information [Abstract]
Net sales	29,480	29,446	65,087	70,099
Gross profit(1)	6,041	6,676	15,352	13,557
Operating Segments | Product
Segment information [Abstract]
Net sales	866,128	793,735	1,746,258	1,504,172
Operating Segments | Product | U.S. Retail
Segment information [Abstract]
Net sales		691,757		1,361,541
Operating Segments | Product | Canada Retail
Segment information [Abstract]
Net sales	63,306	72,532	115,122	72,532
Operating Segments | Product | Brand Portfolio
Segment information [Abstract]
Net sales	95,422	0	196,289	0
Operating Segments | Product | Other
Segment information [Abstract]
Net sales	29,480	29,446	65,087	70,099
Operating Segments | Commission, franchise and other revenue
Segment information [Abstract]
Net sales	11,771	1,533	20,676	3,198
Operating Segments | Commission, franchise and other revenue | U.S. Retail
Segment information [Abstract]
Net sales	0	0	0	0
Operating Segments | Commission, franchise and other revenue | Canada Retail
Segment information [Abstract]
Net sales	0	0	0	0
Operating Segments | Commission, franchise and other revenue | Brand Portfolio
Segment information [Abstract]
Net sales	6,312	0	9,609	0
Operating Segments | Commission, franchise and other revenue | Other
Segment information [Abstract]
Net sales	0	0	0	0
Intersegment Eliminations
Segment information [Abstract]
Net sales	(17,701)	0	(28,221)	0
Intersegment Eliminations | U.S. Retail
Segment information [Abstract]
Net sales	0		0
Intersegment Eliminations | Canada Retail
Segment information [Abstract]
Net sales	0		0
Intersegment Eliminations | Brand Portfolio
Segment information [Abstract]
Net sales	17,701		28,221
Intersegment Eliminations | Other
Segment information [Abstract]
Net sales	0		0
Corporate/Eliminations
Segment information [Abstract]
Net sales	4,246	1,533	9,472	3,198
Gross profit(1)	(436)	0	(1,343)	0
Corporate/Eliminations | Product
Segment information [Abstract]
Net sales		0		0
Corporate/Eliminations | Commission, franchise and other revenue
Segment information [Abstract]
Net sales	4,246	1,533	9,472	3,198
ABG-Camuto, LLC
Segment information [Abstract]
Income (loss) from equity investments	2,464	$ 0	4,692	$ 0
ABG-Camuto, LLC | Operating Segments | U.S. Retail
Segment information [Abstract]
Income (loss) from equity investments	0		0
ABG-Camuto, LLC | Operating Segments | Canada Retail
Segment information [Abstract]
Income (loss) from equity investments	0		0
ABG-Camuto, LLC | Operating Segments | Brand Portfolio
Segment information [Abstract]
Income (loss) from equity investments	2,464		4,692
ABG-Camuto, LLC | Operating Segments | Other
Segment information [Abstract]
Income (loss) from equity investments	0		0
ABG-Camuto, LLC | Corporate/Eliminations
Segment information [Abstract]
Income (loss) from equity investments	$ 0		$ 0