Little Rock-based retailer Dillard’s, Inc. reported lower second quarter profits amid a drop in sales, noting that “consumer caution” continues to be at the root of the decline.
Sales revenue for the 13 weeks ended July 29, 2023 was $1.567 billion compared to $1.589 billion one year ago. Total quarterly revenue, which includes Dillard’s ownership of construction firm CDI Contractors, was $1.597 billion versus $1.618 billion last year.
Net income for the quarter was $131.5 million, down from $163.4 million one year ago. Quarterly earnings per share was $7.98 compared to $9.30 per share for the prior year second quarter.
The numbers reflect a three percent decline in total retail sales year-over-year as well as a three percent decline in same store sales, a key metric for retailers.
Other key financial highlights for the quarter included:
- Retail gross margin of 40.4% of sales compared to 41.5% of sales;
- Operating expenses were $412.6 million (26.3% of sales) compared to $401.3 million (25.3% of sales);
- Share repurchase of $103.4 million (approximately 358,000 shares).
Cosmetics was the strongest performing category followed by home and furniture. Ladies’ accessories and lingerie, ladies’ apparel and shoes were the weakest categories.
“The cautious consumer we noted in the first quarter continued in the first few weeks of the second, leading to a sales decline of 3%. We exited the quarter with inventory flat year-over-year, while maintaining a strong retail gross margin of 40.4%. We repurchased $103 million of stock and ended the quarter with $924 million in cash and short-term investments,” Dillard’s CEO William T. Dillard said.
Dillard’s operates 274 department stores, including 27 clearance centers, spanning 29 states and it has an online presence at dillards.com.
Shares of Dillard’s (NYSE: DDS) closed Wednesday at $336.15. The company’s stock has traded between a low of $254.49 per share and a high of $417.86 per share over the past 52 weeks.