Dillard's Q2 Net Falls 5.5 Percent
LITTLE ROCK, Ark.-Dillard's second-quarter net income totaled $34.5 million, down 5.5 percent from last year's second quarter, in what CEO William Dillard II characterized as a "somewhat" disappointing performance.
Net sales in the quarter, which ended on Aug. 2, slipped 0.4 percent to $1.5 billion, even though same-store sales were up 1 percent. Home and furniture proved to be among the weakest categories for Dillard's in the quarter, while sales were strongest in juniors' and children's apparel, followed by men's apparel and accessories. Geographically, the central region logged the strongest sales results, followed by the eastern and western regions, respectively.
Gross margin was off 21 basis points to 33.8 percent, the result primarily of increased markdowns. Selling, general and administrative expenses edged up 0.6 percent in dollars and 25 basis points as a percentage of sales, to 27.2 percent. SG&A firmed because of increased payroll expenses, partially offset by declines in insurance and advertising costs.
"Although our 1 percent comparable-store increase led to a profitable quarter, we are somewhat disappointed in the bottom-line performance," Dillard said. "We are pleased with our inventory management during the quarter and with our ending inventory position."