Dillard’s Sales and Profits Strengthen With Economy
The department store’s comparable-store sales rose 2 percent in the first quarter.
Dillard’s Inc. served up some more good news for department stores Thursday, posting better first-quarter sales and profits.
Net earnings rose 21.4 percent to $80.5 million, or $2.89 a share, from $66.3 million, or $2.12, a year earlier.
Revenues for the three months ended May 5 increased 2.7 percent to $1.46 billion from $1.42 billion with a boost from the company’s CDI Contractors construction business. Merchandise sales increased 1.7 percent to $1.41 billion with comparable-store sales up 2 percent.
The results echoed those of Macy’s Inc., which posted better sales and profits that impressed Wall Street and spoke to a strong economic backdrop.
William T. Dillard 2nd, chief executive officer, noted: “Our positive sales momentum continued into the first quarter. We believe this indicates our customer is more comfortable spending in this economic environment, and we hope the positive trend continues.”
The department store said sales of home goods and furniture, women’s accessories, lingerie and juniors’ and children’s apparel were above the company’s sales average.
Sales of men’s apparel and accessories were “slightly above trend” while women’s apparel was on pace with the company average. Cosmetics were below the average and shoes were “notably below” the trend.
Dillard’s has been spending more, laying out an additional $9.4 million in operating expenses in the most recent quarter, which it attributed to increased selling payroll and “services purchased.” Despite that, selling, general and administrative expenses have fallen in relation to the top line, to $406 million, or 27.9 percent of sales, from $396.6 million, or 28 percent of sales, a year earlier.
This spending on sales associates jives with the broader trends of higher wages on the sales floor.
The company also spent $35 million buying back its own stock during the quarter and authorized a new $500 million repurchase program in March.
Shares of Dillard’s gained more than 6 percent in trading Thursday.
Dillard’s operates 267 department stores and 25 clearance centers across 29 states, as well as a web site.