Dillard’s, Inc. (NYSE: DDS) (the “Company” or “Dillard’s”)
announced operating results for the 13 and 39 weeks ended November
2, 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 retail sales declined 4%, we focused on gross
margin, reporting a respectable 44.5% of sales, while working on
expense control. We reported cash and short-term investments of
over $1.1 billion after repurchasing $107 million in stock. We are
looking forward to welcoming our customers and serving them this
holiday season.”
Highlights of the Third Quarter (compared to the prior
year third quarter):
- Total retail
sales decreased 4%
- Comparable
store sales decreased 4%
- Net income
of $124.6 million compared to $155.3 million
- Earnings per
share of $7.73 compared to $9.49
- Retail gross
margin of 44.5% of sales compared to 45.3% of sales
- Operating
expenses were $418.9 million (29.4% of sales) compared to $421.8
million (28.6% of sales)
- Ending
inventory increased 3%
Third Quarter Results
Dillard’s reported net income for the 13 weeks ended November 2,
2024 of $124.6 million, or $7.73 per share, compared to $155.3
million, or $9.49 per share, for the 13 weeks ended October 28,
2023. Included in net income for the 13 weeks ended October 28,
2023 is a pretax gain of $4.0 million ($3.1 million after tax or
$0.19 per share) primarily related to the sale of a store
property.
Sales – Third Quarter
Net sales for the 13 weeks ended November 2, 2024 and October
28, 2023 were $1.427 billion and $1.476 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
November 2, 2024 and October 28, 2023 were $1.356 billion and
$1.409 billion, respectively. Total retail sales decreased 4% for
the 13-week period ended November 2, 2024 compared to the 13-week
period ended October 28, 2023. Sales in comparable stores for that
same period decreased 4%. Cosmetics was the strongest performing
merchandise category, with the weakest performances noted in
juniors’ and children’s apparel and men’s apparel and
accessories.
Gross Margin – Third Quarter
Consolidated gross margin for the 13 weeks ended November 2,
2024 was 42.6% of sales compared to 43.5% of sales for the 13 weeks
ended October 28, 2023.
Retail gross margin for the 13 weeks ended November 2, 2024 was
44.5% of sales compared to 45.3% of sales for the 13 weeks ended
October 28, 2023. Compared to the prior year third quarter, retail
gross margin increased slightly in ladies’ accessories and lingerie
and was flat in men’s apparel and accessories and cosmetics. Gross
margin decreased slightly in shoes and juniors’ and children’s
apparel and decreased moderately in home and furniture and ladies’
apparel.
Inventory increased 3% at November 2, 2024 compared to October
28, 2023. The Company notes a shorter selling period between
Thanksgiving and Christmas this year.
Selling, General & Administrative Expenses – Third
Quarter
Consolidated selling, general and administrative expenses
(“operating expenses”) for the 13 weeks ended November 2, 2024
decreased $2.9 million to $418.9 million (29.4% of sales) compared
to $421.8 million (28.6% of sales) for the 13 weeks ended October
28, 2023. Compared to the prior year third quarter, payroll expense
was flat while insurance benefit expense increased. The Company
worked to control expenses during the quarter, and these efforts
will continue.
Highlights of the 39 Weeks (compared to the prior year
39 weeks):
- Total retail
sales decreased 3%
- Comparable
store sales decreased 4%
- Net income
of $379.1 million compared to $488.3 million
- Earnings per
share of $23.42 compared to $29.38
- Retail gross
margin of 43.3% of sales compared to 43.7% of sales
- Operating
expenses were $1,279.2 million (28.6% of sales) compared to
$1,240.7 million (26.8% of sales)
39-Week Results
Dillard’s reported net income for the 39 weeks ended November 2,
2024 of $379.1 million, or $23.42 per share, compared to $488.3
million, or $29.38 per share, for the 39 weeks ended October 28,
2023. Included in net income for the 39 weeks ended October 28,
2023 is a pretax gain of $6.0 million ($4.6 million after tax or
$0.28 per share) primarily related to the sale of two store
properties.
Sales – 39 Weeks
Net sales for the 39 weeks ended November 2, 2024 and October
28, 2023 were $4.466 billion and $4.628 billion, respectively.
Total retail sales for the 39 weeks ended November 2, 2024 and
October 28, 2023 were $4.275 billion and $4.423 billion,
respectively. Total retail sales decreased 3% for the 39-week
period ended November 2, 2024 compared to the 39-week period ended
October 28, 2023. Sales in comparable stores for that same period
decreased 4%.
Gross Margin – 39 Weeks
Consolidated gross margin for the 39 weeks ended November 2,
2024 was 41.6% of sales compared to 42.0% of sales for the 39 weeks
ended October 28, 2023.
Retail gross margin (which excludes CDI) for the 39 weeks ended
November 2, 2024 was 43.3% of sales compared to 43.7% of sales for
the 39 weeks ended October 28, 2023.
Selling, General & Administrative Expenses – 39
Weeks
Operating expenses for the 39 weeks ended November 2, 2024 were
$1,279.2 million (28.6% of sales) compared to $1,240.7 million
(26.8% of sales) for the 39 weeks ended October 28, 2023. The
increase in operating expenses is primarily due to increased
payroll and payroll-related expenses.
Share Repurchase
During the 13 weeks ended November 2, 2024 the Company purchased
$107.0 million (approximately 294,000 shares) of Class A Common
Stock at an average price of $364.43 per share. As of November 2,
2024, authorization of $287.0 million remained under the May 2023
program.
Total shares outstanding (Class A and Class B Common Stock) at
November 2, 2024 and October 28, 2023 were 15.9 million and 16.3
million, respectively.
Other Information
The Company operates 273 Dillard’s stores, including 28
clearance centers, spanning 30 states (totaling 46.4 million square
feet) and an Internet store at dillards.com.
Dillard’s, Inc. and SubsidiariesCondensed Consolidated Statements
of Income (Unaudited)(In Millions, Except Per Share Data) |
|
|
|
|
13 Weeks Ended |
|
|
39 Weeks Ended |
|
|
November 2, 2024 |
|
|
October 28, 2023 |
|
|
November 2, 2024 |
|
|
October 28, 2023 |
|
|
Amount |
|
% ofNetSales |
|
|
Amount |
|
% ofNetSales |
|
|
Amount |
|
% ofNetSales |
|
|
Amount |
|
% ofNetSales |
|
Net sales |
$ |
1,427.0 |
|
|
100.0 |
% |
|
|
$ |
1,476.4 |
|
|
100.0 |
% |
|
|
$ |
4,466.0 |
|
|
100.0 |
% |
|
|
$ |
4,627.7 |
|
|
100.0 |
% |
|
Service
charges and otherincome |
|
24.2 |
|
|
1.7 |
|
|
|
|
27.8 |
|
|
1.9 |
|
|
|
|
72.6 |
|
|
1.6 |
|
|
|
|
87.9 |
|
|
1.9 |
|
|
|
|
1,451.2 |
|
|
101.7 |
|
|
|
|
1,504.2 |
|
|
101.9 |
|
|
|
|
4,538.6 |
|
|
101.6 |
|
|
|
|
4,715.6 |
|
|
101.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales |
|
819.3 |
|
|
57.4 |
|
|
|
|
834.5 |
|
|
56.5 |
|
|
|
|
2,607.5 |
|
|
58.4 |
|
|
|
|
2,684.6 |
|
|
58.0 |
|
|
Selling,
general andadministrative expenses |
|
418.9 |
|
|
29.4 |
|
|
|
|
421.8 |
|
|
28.6 |
|
|
|
|
1,279.2 |
|
|
28.6 |
|
|
|
|
1,240.7 |
|
|
26.8 |
|
|
Depreciation and amortization |
|
44.1 |
|
|
3.1 |
|
|
|
|
44.7 |
|
|
3.0 |
|
|
|
|
136.5 |
|
|
3.1 |
|
|
|
|
135.3 |
|
|
2.9 |
|
|
Rentals |
|
4.9 |
|
|
0.3 |
|
|
|
|
4.9 |
|
|
0.3 |
|
|
|
|
14.9 |
|
|
0.3 |
|
|
|
|
14.3 |
|
|
0.3 |
|
|
Interest
and debt (income)expense, net |
|
(4.5 |
) |
|
(0.3 |
) |
|
|
|
(1.8 |
) |
|
(0.1 |
) |
|
|
|
(11.9 |
) |
|
(0.3 |
) |
|
|
|
(1.5 |
) |
|
0.0 |
|
|
Other
expense |
|
6.2 |
|
|
0.4 |
|
|
|
|
4.7 |
|
|
0.3 |
|
|
|
|
18.5 |
|
|
0.4 |
|
|
|
|
14.1 |
|
|
0.3 |
|
|
Gain on
disposal of assets |
|
0.2 |
|
|
0.0 |
|
|
|
|
4.0 |
|
|
0.3 |
|
|
|
|
0.5 |
|
|
0.0 |
|
|
|
|
6.0 |
|
|
0.1 |
|
|
Income
before income taxes |
|
162.5 |
|
|
11.4 |
|
|
|
|
199.4 |
|
|
13.5 |
|
|
|
|
494.4 |
|
|
11.1 |
|
|
|
|
634.1 |
|
|
13.7 |
|
|
Income
taxes |
|
37.9 |
|
|
|
|
|
|
|
44.1 |
|
|
|
|
|
|
|
115.3 |
|
|
|
|
|
|
|
145.8 |
|
|
|
|
|
Net
income |
$ |
124.6 |
|
|
8.7 |
% |
|
|
$ |
155.3 |
|
|
10.5 |
% |
|
|
$ |
379.1 |
|
|
8.5 |
% |
|
|
$ |
488.3 |
|
|
10.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
and diluted earnings pershare |
$ |
7.73 |
|
|
|
|
|
|
$ |
9.49 |
|
|
|
|
|
|
$ |
23.42 |
|
|
|
|
|
|
$ |
29.38 |
|
|
|
|
|
Basic
and diluted weightedaverage shares outstanding |
|
16.1 |
|
|
|
|
|
|
|
16.4 |
|
|
|
|
|
|
|
16.2 |
|
|
|
|
|
|
|
16.6 |
|
|
|
|
|
|
|
Dillard’s, Inc. and SubsidiariesCondensed Consolidated Balance
Sheets (Unaudited)(In Millions) |
|
|
|
|
|
|
November 2,2024 |
|
|
October 28,2023 |
|
|
Assets |
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
980.4 |
|
|
$ |
842.0 |
|
|
Accounts receivable |
|
61.7 |
|
|
|
57.4 |
|
|
Short-term investments |
|
128.9 |
|
|
|
51.3 |
|
|
Merchandise inventories |
|
1,682.2 |
|
|
|
1,629.2 |
|
|
Other current assets |
|
89.1 |
|
|
|
85.7 |
|
|
Total current assets |
|
2,942.3 |
|
|
|
2,665.6 |
|
|
|
|
|
|
|
|
|
|
|
Property
and equipment, net |
|
1,030.7 |
|
|
|
1,094.6 |
|
|
Operating lease assets |
|
35.9 |
|
|
|
34.4 |
|
|
Deferred
income taxes |
|
64.8 |
|
|
|
47.6 |
|
|
Other
assets |
|
59.4 |
|
|
|
55.7 |
|
|
|
|
|
|
|
|
|
|
|
Total
assets |
$ |
4,133.1 |
|
|
$ |
3,897.9 |
|
|
|
|
|
|
|
|
|
|
|
Liabilities and stockholders’ equity |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Trade accounts payable and accrued expenses |
$ |
1,215.0 |
|
|
$ |
1,181.2 |
|
|
Current portion of operating lease liabilities |
|
11.7 |
|
|
|
8.5 |
|
|
Federal and state income taxes |
|
10.0 |
|
|
|
12.5 |
|
|
Total current liabilities |
|
1,236.7 |
|
|
|
1,202.2 |
|
|
|
|
|
|
|
|
|
|
|
Long-term debt |
|
321.6 |
|
|
|
321.4 |
|
|
Operating lease liabilities |
|
24.3 |
|
|
|
26.2 |
|
|
Other
liabilities |
|
387.1 |
|
|
|
334.5 |
|
|
Subordinated debentures |
|
200.0 |
|
|
|
200.0 |
|
|
Stockholders’ equity |
|
1,963.4 |
|
|
|
1,813.6 |
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and stockholders’ equity |
$ |
4,133.1 |
|
|
$ |
3,897.9 |
|
|
|
|
|
Dillard’s, Inc. and SubsidiariesCondensed Consolidated Statements
of Cash Flows (Unaudited)(In Millions) |
|
|
|
|
39 Weeks Ended |
|
|
November 2,2024 |
|
October 28,2023 |
|
Operating activities: |
|
|
|
|
|
|
|
|
Net
income |
$ |
379.1 |
|
|
$ |
488.3 |
|
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization of property and other deferred
cost |
|
137.8 |
|
|
|
136.5 |
|
|
Gain on disposal of assets |
|
(0.5 |
) |
|
|
(6.0 |
) |
|
Accrued interest on short-term investments |
|
(9.2 |
) |
|
|
(4.2 |
) |
|
Changes
in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Increase in accounts receivable |
|
(1.2 |
) |
|
|
(0.5 |
) |
|
Increase in merchandise inventories |
|
(588.2 |
) |
|
|
(509.0 |
) |
|
Decrease in other current assets |
|
9.8 |
|
|
|
4.6 |
|
|
(Increase) decrease in other assets |
|
(1.0 |
) |
|
|
0.2 |
|
|
Increase in trade accounts payable and accrued expenses and other
liabilities |
|
447.6 |
|
|
|
354.6 |
|
|
Decrease in income taxes |
|
(24.8 |
) |
|
|
(17.4 |
) |
|
Net cash
provided by operating activities |
|
349.4 |
|
|
|
447.1 |
|
|
|
|
|
|
|
|
|
|
|
Investing activities: |
|
|
|
|
|
|
|
|
Purchase
of property and equipment and capitalized software |
|
(89.1 |
) |
|
|
(104.7 |
) |
|
Proceeds
from disposal of assets |
|
0.6 |
|
|
|
6.3 |
|
|
Proceeds
from insurance |
|
— |
|
|
|
4.5 |
|
|
Purchase
of short-term investments |
|
(422.4 |
) |
|
|
(148.1 |
) |
|
Proceeds
from maturities of short-term investments |
|
450.8 |
|
|
|
250.0 |
|
|
Net cash
(used in) provided by investing activities |
|
(60.1 |
) |
|
|
8.0 |
|
|
|
|
|
|
|
|
|
|
|
Financing activities: |
|
|
|
|
|
|
|
|
Cash
dividends paid |
|
(12.2 |
) |
|
|
(10.1 |
) |
|
Purchase
of treasury stock |
|
(105.0 |
) |
|
|
(263.3 |
) |
|
Net cash
used in financing activities |
|
(117.2 |
) |
|
|
(273.4 |
) |
|
|
|
|
|
|
|
|
|
|
Increase
in cash and cash equivalents and restricted cash |
|
172.1 |
|
|
|
181.7 |
|
|
Cash and
cash equivalents and restricted cash, beginning of period |
|
808.3 |
|
|
|
660.3 |
|
|
Cash and
cash equivalents, end of period |
$ |
980.4 |
|
|
$ |
842.0 |
|
|
|
|
|
|
|
|
|
|
|
Non-cash
transactions: |
|
|
|
|
|
|
|
|
Accrued
capital expenditures |
$ |
9.9 |
|
|
$ |
10.9 |
|
|
Accrued
purchase of treasury stock and excise taxes |
|
3.1 |
|
|
|
4.6 |
|
|
Stock
awards |
|
1.6 |
|
|
|
1.3 |
|
|
Lease
assets obtained in exchange for new operating lease
liabilities |
|
2.2 |
|
|
|
9.2 |
|
|
|
|
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 |
|
|
2024Estimated |
|
2023Actual |
|
Depreciation and amortization |
$ |
180 |
|
|
$ |
180 |
|
|
Rentals |
|
22 |
|
|
|
22 |
|
|
Interest and debt (income) expense, net |
|
(13 |
) |
|
|
(5 |
) |
|
Capital expenditures |
|
110 |
|
|
|
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,
higher 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.
CONTACT:Dillard’s, Inc.Julie J.
Guymon501-376-5965julie.guymon@dillards.com
Dillards (NYSE:DDS)
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