Dillard’s Notches Profitable First Quarter
Dillard’s is definitely seeing the light at the end of the tunnel.
The Little Rock, Ark.-based department store reported after the market close on Thursday that after logging a loss a year ago, it was back in the black in the first quarter ended May 1, 2021.
The company reported net income of $158.2 million, or $7.25 a share, compared to a net loss of $162 million, or $6.94 a share, in the same period last year. Included in the 13-week figures is a pretax gain of $24.6 million — $19.2 million after tax or 88 cents a share — primarily related to the sale of three store properties.
Total retail sales rose to $1.3 billion from $751 million in the year-ago period. The company said the strongest-performing categories in the quarter were juniors’ and children’s apparel, men’s apparel and accessories and ladies’ accessories and lingerie.
Dillard’s also provided comparisons to the first quarter of 2019 and said using that as a guide, comparable-store sales declined 6 percent and total sales fell 9 percent from the $1.4 billion recorded two years ago prior to the pandemic.
This year, gross margins also improved, which the company attributed to “better inventory management and customer demand leading to decreased markdowns in the first quarter of 2021.” Retail gross margin for the 13 weeks improved to 42.7 percent from 12.8 percent in the prior year’s first quarter. The number also marked an improvement from the first quarter of 2019 when retail gross margin was 37.8 percent. Inventory decreased approximately 17 percent in the period.
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“There are a lot of good things to say about this quarter,” said William T. Dillard, 2nd, chief executive officer. “As vaccinations increased, stimulus money was released and warmer weather arrived, we saw sales increase over 2019 levels, with momentum continuing throughout the quarter. We are pleased to report record performances in gross margin and earnings per share. With strong cash flow, we accomplished $59 million in share repurchase while still ending the quarter with $616 million in cash.”
The company did not host an earnings call with analysts or provide full-year projections for earnings or sales. It only said it would increase its capital expenditures to $130 million for the fiscal year ending Jan. 29, 2022, up from $60 million in the prior fiscal year.
Dillard’s stock increased nearly 8 percent in after-hours trading Thursday, closing at $110.
Dillard’s operates 250 full-line stores and 31 clearance centers in 29 states.
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