Lower sales and profits in the fourth quarter bruised Dillard’s full year earnings as the Little Rock-based retailer continues its efforts to navigate an industry in transition.
Dillard’s reported fourth quarter net income of $67.7 million Tuesday (Feb. 25) on sales of $1.923 billion. A year ago, Dillard’s reported fourth quarter profits of $85.1 million on revenue of $2.011 billion.
For the full year, Dillard’s net sales dropped from $6.356 billion to $6.203 billion. Full year profits shrunk from $170.3 million to $111.1 million in the fiscal year that ended February 1, 2020.
“A weak top line weighed heavily on the bottom line in the fourth quarter,” said Dillard’s Chief Executive Officer William T. Dillard, II. “However, we achieved a consecutive 4% decline in inventory while maintaining a flat gross margin rate. As U.S. department store retailing continues to right size, our conservative financial approach supports our long-term view. We continue to focus on improving our results and on shareholder return.”
The retailer with heavy mall assets said comparable store sales decreased three percent in the fourth quarter compared to a year ago, while retail gross margin remained flat as a percent of sales.
During the fourth quarter, Dillard’s repurchased $36.7 million (approximately 500,000 shares) of Class A Common Stock under its $500 million share repurchase program. During the 52 weeks ended February 1, 2020, the company purchased $138.3 million (approximately 2.2 million shares). As of February 24, 2020, authorization of $215.9 million remained under the program.
Dillard’s has announced plans to open new stores in Colorado and Utah. The company operates 257 Dillard’s locations and 28 clearance centers spanning 29 states and an Internet store at www.dillards.com.
Shares of Dillard’s stock (NYSE: DDS) opened trading on Wednesday (Feb. 26) at $57.80 and enjoyed an increase in price throughout the day. Dillard’s shares have been trading between a low of $47.95 and a high of $86.71 over the past year.