Dillard’s loses $56 million in recent quarter

Little Rock-based Dillard’s Inc. has seen better days.

The retailer reported Wednesday morning (Nov. 26) that it lost $56 million in the third quarter, compared to an $11.3 million loss in the same quarter of 2007.

For the first nine months of the year, Dillard’s has posted total revenue of $4.791 billion, down 5 percent from the same period in 2007. In the net income category, the company has lost $91.7 million in the first nine months, compared to a gain of $6.4 million in the same period of 2007 — that is almost a $100 million negative swing in net income.

Dillard’s has been under fire from outside groups who call for a change in the company’s management. The management primarily consists of members of the Dillard family. Shares of Dillard’s (NYSE: DDS) plummeted this year. It’s 52 week high is $23.11, and the shares closed Tuesday at $3.75.

“The oppressive economic environment clearly weighed heavily on our results during the third quarter. We continue to take aggressive action to navigate these challenging times. We announced the closure of 21 under-performing stores during 2008, dramatically reduced capital spending for 2008 and 2009 and are executing appropriate operating expense reduction measures throughout the Company,” William Dillard II, the company CEO, noted in a statement.

The company also said it has access to a $1.2 billion credit line with JP Morgan Chase Bank to help it through the economic downturn.

Other items noted by Dillard’s in the earnings report include:

• Dillard’s recently announced a strategic staff reduction of approximately 8 percent of its salaried associates as part of its ongoing efforts to reduce operating expenses. The positions were comprised mainly of salaried managers and support professionals including 60 in the Company’s Little Rock headquarters.

• Dillard’s expects approximately $100 million in savings in operating expenses in 2008 as a result of recent expense cutting measures. Management estimates additional operating expense savings in 2009 to be approximately $70 million as a result of recent actions including the recently-announced strategic staff reduction.

• Total maturities of long-term debt in 2009 and 2010 are less than $26 million.

• The closure of 21 under-performing stores will result in over $50 million reduction in working capital requirement for 2009.