Dillard’s, Inc. (NYSE: DDS) (the “Company” or “Dillard’s”)
announced operating results for the 13 weeks ended May 4, 2024.
This release contains certain forward-looking statements. Please
refer to the Company’s cautionary statements included below under
“Forward-Looking Information.”
Dillard’s Chief Executive Officer William T. Dillard, II
stated, “While the consumer environment remained challenging, we
focused on profitable sales by offering interesting product
combined with inventory control. As a result, our retail gross
margin was 46.2% and inventory was down 2%. For the first time in
our history, we reported cash and short-term investments exceeding
$1 billion.”
Highlights of the First Quarter (compared to the prior year
first quarter):
- Total retail sales decreased 1%
- Comparable store sales decreased 2%
- Net income of $180.0 million compared to $201.5
million
- Earnings per share of $11.09 compared to $11.85
- Retail gross margin of 46.2% of sales compared to 45.6% of
sales
- Operating expenses were $426.7 million (27.5% of sales)
compared to $406.4 million (25.7% of sales)
- Ending inventory decreased 2% year over year
First Quarter Results
Dillard’s reported net income for the 13 weeks ended May 4, 2024
of $180.0 million, or $11.09 per share, compared to $201.5 million,
or $11.85 per share, for the 13 weeks ended April 29, 2023.
Included in net income for the prior year first quarter is a pretax
gain of $1.8 million ($1.4 million after tax or $0.08 per share)
primarily related to the sale of a store property.
Sales
Net sales for the 13 weeks ended May 4, 2024 and April 29, 2023
were $1.549 billion and $1.584 billion, respectively. Net sales
includes the operations of the Company’s construction business, CDI
Contractors, LLC (“CDI”).
Total retail sales (which excludes CDI) for the 13 weeks ended
May 4, 2024 and April 29, 2023 were $1.493 billion and $1.515
billion, respectively. Total retail sales decreased 1% for the
13-week period ended May 4, 2024 compared to the 13-week period
ended April 29, 2023. Sales in comparable stores for that same
period decreased 2%. The Company noted a continued challenging
sales environment during the first quarter. Cosmetics was the
strongest performing merchandise category, and men’s apparel and
accessories was the weakest performing category.
Gross Margin
Consolidated gross margin for the 13 weeks ended May 4, 2024 was
44.6% of sales compared to 43.7% of sales for the 13 weeks ended
April 29, 2023.
Retail gross margin (which excludes CDI) for the 13 weeks ended
May 4, 2024 was 46.2% of sales compared to 45.6% of sales for the
13 weeks ended April 29, 2023. Gross margin increased moderately in
home and furniture and ladies’ accessories and lingerie and
increased slightly in men’s apparel and accessories, ladies’
apparel, and juniors’ and children’s apparel. Gross margin was
essentially flat in shoes and cosmetics.
Inventory decreased 2% at May 4, 2024 compared to April 29,
2023.
Selling, General & Administrative Expenses
Consolidated selling, general and administrative expenses
(“operating expenses”) for the 13 weeks ended May 4, 2024 were
$426.7 million (27.5% of sales) compared to $406.4 million (25.7%
of sales) for the 13 weeks ended April 29, 2023. The increase in
operating expenses is primarily due to increased payroll
expense.
Other Information
The Company opened a new location at The Empire Mall in Sioux
Falls, South Dakota in March of 2024 (140,000 square feet) marking
its 30th state of operation. Dillard’s has announced the upcoming
closure of its Eastwood Mall Clearance Center in Niles, Ohio
(120,000 square feet) in July of 2024.
The Company operates 274 Dillard’s stores, including 29
clearance centers, spanning 30 states (totaling 46.6 million square
feet) and an Internet store at dillards.com.
Total shares outstanding (Class A and Class B Common Stock) at
May 4, 2024 and April 29, 2023 were 16.2 million and 16.8 million,
respectively.
Dillard’s, Inc. and
Subsidiaries
Condensed Consolidated Statements
of Income (Unaudited)
(In Millions, Except Per Share
Data)
13 Weeks Ended
May 4, 2024
April 29, 2023
% of
% of
Net
Net
Amount
Sales
Amount
Sales
Net sales
$
1,549.1
100.0
%
$
1,583.9
100.0
%
Service charges and other income
23.7
1.5
30.0
1.9
1,572.8
101.5
1,613.9
101.9
Cost of sales
857.8
55.4
891.3
56.3
Selling, general and administrative
expenses
426.7
27.5
406.4
25.7
Depreciation and amortization
46.1
3.0
45.7
2.9
Rentals
5.0
0.3
4.4
0.3
Interest and debt (income) expense,
net
(3.5
)
(0.2
)
0.1
0.0
Other expense
6.2
0.4
4.7
0.3
Gain on disposal of assets
0.3
0.0
1.8
0.1
Income before income taxes
234.8
15.2
263.1
16.6
Income taxes
54.8
61.6
Net income
$
180.0
11.6
%
$
201.5
12.7
%
Basic and diluted earnings per share
$
11.09
$
11.85
Basic and diluted weighted average shares
outstanding
16.2
17.0
Dillard’s, Inc. and
Subsidiaries
Condensed Consolidated Balance
Sheets (Unaudited)
(In Millions)
May 4,
April 29,
2024
2023
Assets
Current assets:
Cash and cash equivalents
$
817.8
$
848.3
Restricted cash
—
8.4
Accounts receivable
49.3
59.1
Short-term investments
347.2
98.4
Merchandise inventories
1,387.7
1,410.0
Other current assets
106.2
79.0
Total current assets
2,708.2
2,503.2
Property and equipment, net
1,063.0
1,108.7
Operating lease assets
41.9
32.9
Deferred income taxes
64.0
41.8
Other assets
60.1
62.4
Total assets
$
3,937.2
$
3,749.0
Liabilities and stockholders’ equity
Current liabilities:
Trade accounts payable and accrued
expenses
$
1,031.3
$
1,099.7
Current portion of operating lease
liabilities
11.6
9.1
Federal and state income taxes
87.4
82.0
Total current liabilities
1,130.3
1,190.8
Long-term debt
321.5
321.4
Operating lease liabilities
30.3
23.7
Other liabilities
380.1
330.0
Subordinated debentures
200.0
200.0
Stockholders’ equity
1,875.0
1,683.1
Total liabilities and stockholders’
equity
$
3,937.2
$
3,749.0
Dillard’s, Inc. and
Subsidiaries
Condensed Consolidated Statements
of Cash Flows (Unaudited)
(In Millions)
13 Weeks Ended
May 4,
April 29,
2024
2023
Operating activities:
Net income
$
180.0
$
201.5
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization of property
and other deferred cost
46.5
46.1
Gain on disposal of assets
(0.3
)
(1.8
)
Accrued interest on short-term
investments
(3.2
)
(1.9
)
Changes in operating assets and
liabilities:
Decrease (increase) in accounts
receivable
11.3
(2.1
)
Increase in merchandise inventories
(293.7
)
(289.8
)
(Increase) decrease in other current
assets
(9.8
)
7.2
Increase in other assets
(0.2
)
(0.4
)
Increase in trade accounts payable and
accrued expenses and other liabilities
259.5
261.6
Increase in income taxes
54.3
60.5
Net cash provided by operating
activities
244.4
280.9
Investing activities:
Purchase of property and equipment and
capitalized software
(35.2
)
(32.4
)
Proceeds from disposal of assets
0.3
1.9
Purchase of short-term investments
(245.9
)
(97.5
)
Proceeds from maturities of short-term
investments
50.0
150.0
Net cash (used in) provided by investing
activities
(230.8
)
22.0
Financing activities:
Cash dividends paid
(4.1
)
(3.4
)
Purchase of treasury stock
—
(103.1
)
Net cash used in financing activities
(4.1
)
(106.5
)
Increase in cash and cash equivalents and
restricted cash
9.5
196.4
Cash and cash equivalents and restricted
cash, beginning of period
808.3
660.3
Cash and cash equivalents and restricted
cash, end of period
$
817.8
$
856.7
Non-cash transactions:
Accrued capital expenditures
$
6.4
$
8.6
Accrued purchase of treasury stock and
excise taxes
—
11.9
Lease assets obtained in exchange for new
operating lease liabilities
2.2
1.8
Estimates for 2024
The Company is providing the following estimates for certain
financial statement items for the 52-week period ending February 1,
2025 based upon current conditions. Actual results may differ
significantly from these estimates as conditions and factors change
- See “Forward-Looking Information.”
In Millions
2024
2023
Estimated
Actual
Depreciation and amortization
$
185
$
180
Rentals
22
22
Interest and debt (income) expense,
net
(8
)
(5
)
Capital expenditures
130
133
Forward-Looking Information
This report contains certain forward-looking statements. The
following are or may constitute forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995: (a) statements including words such as “may,” “will,”
“could,” “should,” “believe,” “expect,” “future,” “potential,”
“anticipate,” “intend,” “plan,” “estimate,” “continue,” or the
negative or other variations thereof; (b) statements regarding
matters that are not historical facts; and (c) statements about the
Company’s future occurrences, plans and objectives, including
statements regarding management’s expectations and forecasts for
the 52-week period ended February 1, 2025 and beyond, statements
concerning the opening of new stores or the closing of existing
stores, statements concerning capital expenditures and sources of
liquidity and statements concerning estimated taxes. The Company
cautions that forward-looking statements contained in this report
are based on estimates, projections, beliefs and assumptions of
management and information available to management at the time of
such statements and are not guarantees of future performance. The
Company disclaims any obligation to update or revise any
forward-looking statements based on the occurrence of future
events, the receipt of new information or otherwise.
Forward-looking statements of the Company involve risks and
uncertainties and are subject to change based on various important
factors. Actual future performance, outcomes and results may differ
materially from those expressed in forward-looking statements made
by the Company and its management as a result of a number of risks,
uncertainties and assumptions. Representative examples of those
factors include (without limitation) general retail industry
conditions and macro-economic conditions including inflation,
rising interest rates, a potential U.S. Federal government
shutdown, economic recession and changes in traffic at malls and
shopping centers; economic and weather conditions for regions in
which the Company’s stores are located and the effect of these
factors on the buying patterns of the Company’s customers,
including the effect of changes in prices and availability of oil
and natural gas; the availability of and interest rates on consumer
credit; the impact of competitive pressures in the department store
industry and other retail channels including specialty, off-price,
discount and Internet retailers; changes in the Company’s ability
to meet labor needs amid nationwide labor shortages and an intense
competition for talent; changes in consumer spending patterns, debt
levels and their ability to meet credit obligations; high levels of
unemployment; changes in tax legislation (including the Inflation
Reduction Act of 2022); changes in legislation and governmental
regulations, affecting such matters as the cost of employee
benefits or credit card income, such as the Consumer Financial
Protection Bureau’s recent amendment to Regulation Z to limit the
dollar amounts credit card companies can charge for late fees;
adequate and stable availability and pricing of materials,
production facilities and labor from which the Company sources its
merchandise; changes in operating expenses, including employee
wages, commission structures and related benefits; system failures
or data security breaches; possible future acquisitions of store
properties from other department store operators; the continued
availability of financing in amounts and at the terms necessary to
support the Company’s future business; fluctuations in SOFR and
other base borrowing rates; potential disruption from terrorist
activity and the effect on ongoing consumer confidence; epidemic,
pandemic or public health issues and their effects on public
health, our supply chain, the health and well-being of our
employees and customers and the retail industry in general;
potential disruption of international trade and supply chain
efficiencies; global conflicts (including the ongoing conflicts in
the Middle East and Ukraine) and the possible impact on consumer
spending patterns and other economic and demographic changes of
similar or dissimilar nature, and other risks and uncertainties,
including those detailed from time to time in our periodic reports
filed with the Securities and Exchange Commission, particularly
those set forth under the caption “Item 1A, Risk Factors” in the
Company’s Annual Report on Form 10-K for the fiscal year ended
February 3, 2024.
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version on businesswire.com: https://www.businesswire.com/news/home/20240516779751/en/
Dillard’s, Inc. Julie J. Guymon 501-376-5965
julie.guymon@dillards.com
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