Market Overview - U.S. stock markets have experienced a significant bull run since the start of 2023, with major indexes like the Dow, S&P 500, and Nasdaq Composite nearing all-time highs [1] - The S&P 500 and Nasdaq Composite have achieved multiple all-time highs in 2025, while the S&P 400 mid-cap index is up 4.9% year to date, just 4.6% away from its 52-week high [2][9] Mid-Cap Stocks - Investment in mid-cap stocks is recognized as a strong portfolio diversification strategy, combining attributes of both small and large-cap stocks [3] - Mid-cap stocks are less vulnerable to losses during economic downturns due to lower international exposure, and they can outperform small caps in a thriving economy due to established management and market presence [4] Recommended Mid-Cap Stocks - Five mid-cap stocks with favorable Zacks Rank for the remainder of 2025 are Dillard's Inc. (DDS), Sterling Infrastructure Inc. (STRL), StoneX Group Inc. (SNEX), Armstrong World Industries Inc. (AWI), and Watts Water Technologies Inc. (WTS), all rated Zacks Rank 1 (Strong Buy) [5][9] Company Insights Dillard's Inc. (DDS) - Dillard's is enhancing growth through strategic initiatives in both brick-and-mortar and e-commerce, focusing on customer acquisition and retention [8] - The company has a strong financial position with solid liquidity and minimal rent obligations, alongside shareholder-friendly practices like dividends and buybacks [10] - Expected revenue and earnings growth rates for DDS are -0.4% and -15.8%, respectively, for the current year, with a 1.8% improvement in the earnings consensus estimate over the last 30 days [11] Sterling Infrastructure Inc. (STRL) - Sterling Infrastructure provides e-infrastructure, transportation, and building solutions, operating through three segments: E-Infrastructure Solutions, Transportation Solutions, and Building Solutions [12][13][14] - The expected revenue and earnings growth rates for STRL are 6.5% and 56.9%, respectively, for the current year, with a 5.3% improvement in the earnings consensus estimate over the last seven days [15] StoneX Group Inc. (SNEX) - StoneX Group operates a global financial services network, offering execution, post-trade settlement, clearing, and custody services through various segments [16] - The expected revenue and earnings growth rates for SNEX are 4.9% and 21.7%, respectively, for the next year, with a 21.7% improvement in the earnings consensus estimate over the last 60 days [17] Armstrong World Industries Inc. (AWI) - Armstrong World Industries is a leading producer of ceiling systems for construction and renovation, operating in three segments: Mineral Fiber, Architectural Specialties, and Unallocated Corporate [18][19][20] - The expected revenue and earnings growth rates for AWI are 12.2% and 15.1%, respectively, for the current year, with a 0.7% improvement in the earnings consensus estimate over the last 30 days [21] Watts Water Technologies Inc. (WTS) - Watts Water Technologies designs and manufactures water safety and flow control products, reporting under three geographic segments: The Americas, Europe, and APMEA [22] - The expected revenue and earnings growth rates for WTS are 3.9% and 11.3%, respectively, for the current year, with a 0.8% improvement in the earnings consensus estimate over the last seven days [24]

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents Dillard's unaudited condensed consolidated financial statements and management's discussion and analysis of financial condition and results of operations [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents Dillard's unaudited condensed consolidated financial statements, including balance sheets, income statements, cash flows, and detailed notes on accounting policies and financial disclosures [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets and stockholders' equity increased as of August 2, 2025, primarily due to higher cash and cash equivalents, while current liabilities also rose Condensed Consolidated Balance Sheets (in thousands) | Metric (in thousands) | August 2, 2025 | February 1, 2025 | August 3, 2024 | | :-------------------- | :------------- | :--------------- | :------------- | | Cash and cash equivalents | $1,012,011 | $717,854 | $946,728 | | Merchandise inventories | $1,219,765 | $1,172,047 | $1,191,432 | | Total current assets | $2,572,080 | $2,368,070 | $2,453,542 | | Total assets | $3,684,473 | $3,531,054 | $3,661,862 | | Total current liabilities | $958,712 | $834,906 | $780,293 | | Total stockholders' equity | $1,919,112 | $1,796,160 | $1,948,921 | [Condensed Consolidated Statements of Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Net sales slightly increased for the three months ended August 2, 2025, but net income and income before taxes decreased, while EPS saw a modest rise due to fewer shares outstanding Condensed Consolidated Statements of Income (in thousands, except per share) | Metric (in thousands, except per share) | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | | :------------------------------------ | :----------------------------- | :----------------------------- | :--------------------------- | :--------------------------- | | Net sales | $1,513,830 | $1,489,938 | $3,042,693 | $3,038,989 | | Income before income taxes | $94,585 | $97,113 | $308,282 | $331,921 | | Net income | $72,835 | $74,483 | $236,652 | $254,521 | | Basic and diluted EPS | $4.66 | $4.59 | $15.08 | $15.68 | [Condensed Consolidated Statements of Comprehensive Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) Comprehensive income decreased for both three and six months ended August 2, 2025, primarily due to lower net income, partially offset by retirement plan adjustments Condensed Consolidated Statements of Comprehensive Income (in thousands) | Metric (in thousands) | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | | :-------------------- | :----------------------------- | :----------------------------- | :--------------------------- | :--------------------------- | | Net income | $72,835 | $74,483 | $236,652 | $254,521 | | Other comprehensive income | $808 | $1,943 | $1,616 | $3,887 | | Comprehensive income | $73,643 | $76,426 | $238,268 | $258,408 | [Condensed Consolidated Statements of Stockholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Stockholders' equity increased for the three and six months ended August 2, 2025, driven by net income, despite treasury stock repurchases and cash dividends Condensed Consolidated Statements of Stockholders' Equity (in thousands) | Metric (in thousands) | Three Months Ended Aug 2, 2025 | Six Months Ended Aug 2, 2025 | | :-------------------- | :----------------------------- | :--------------------------- | | Net income | $72,835 | $236,652 | | Purchase of treasury stock | $(9,840) | $(108,820) | | Cash dividends declared | $(3,903) | $(7,827) | | Total stockholders' equity (end of period) | $1,919,112 | $1,919,112 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities significantly increased for the six months ended August 2, 2025, driven by income tax changes, while investing generated cash and financing used cash for repurchases Condensed Consolidated Statements of Cash Flows (in thousands) | Metric (in thousands) | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | | :-------------------- | :--------------------------- | :--------------------------- | | Net cash provided by operating activities | $319,393 | $175,957 | | Net cash provided by (used in) investing activities | $93,746 | $(29,403) | | Net cash used in financing activities | $(118,982) | $(8,113) | | Increase in cash and cash equivalents | $294,157 | $138,441 | | Cash and cash equivalents, end of period | $1,012,011 | $946,728 | [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide essential context to the financial statements, detailing basis of presentation, accounting standards, segment information, EPS, commitments, benefit plans, credit, stock repurchases, income taxes, and fair value disclosures [Note 1. Basis of Presentation](index=11&type=section&id=Note%201.%20Basis%20of%20Presentation) Unaudited interim financial statements are prepared under SEC rules and GAAP, with management noting that interim results are not indicative of full fiscal year performance due to seasonality - The financial statements are unaudited and prepared in accordance with SEC rules and GAAP, with all necessary adjustments included[19](index=19&type=chunk) - Operating results for the interim periods are not necessarily indicative of full fiscal year results due to the seasonal nature of the business[19](index=19&type=chunk) [Note 2. Accounting Standards](index=11&type=section&id=Note%202.%20Accounting%20Standards) No recently adopted accounting pronouncements had a material impact, while the company evaluates new ASUs on income tax and expense disaggregation disclosures - No recently adopted accounting pronouncements had a material impact on the financial statements[21](index=21&type=chunk) - The company is evaluating ASU No. 2023-09, 'Improvements to Income Tax Disclosures,' effective for fiscal years beginning after December 15, 2024[23](index=23&type=chunk) - The company is evaluating ASU No. 2024-03, 'Expense Disaggregation Disclosures,' effective for annual reporting periods beginning after December 15, 2026[24](index=24&type=chunk) [Note 3. Business Segments](index=13&type=section&id=Note%203.%20Business%20Segments) Dillard's operates in retail and construction segments, with retail accounting for **96% of net sales**; construction sales increased, while retail sales were mixed across periods - The Company operates in two reportable segments: retail department stores ("retail operations") and a general contracting construction company ("construction")[25](index=25&type=chunk) Percentage of Net Sales by Segment and Major Product Line | Product Line / Segment | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | | :--------------------- | :----------------------------- | :----------------------------- | :--------------------------- | :--------------------------- | | Retail operations segment: | | | | | | Cosmetics | 15 % | 15 % | 15 % | 15 % | | Ladies' apparel | 22 | 22 | 22 | 23 | | Ladies' accessories and lingerie | 15 | 14 | 14 | 13 | | Juniors' and children's apparel | 8 | 8 | 9 | 9 | | Men's apparel and accessories | 20 | 20 | 19 | 19 | | Shoes | 13 | 14 | 14 | 14 | | Home and furniture | 3 | 3 | 3 | 3 | | **Subtotal Retail** | **96** | **96** | **96** | **96** | | Construction segment | 4 | 4 | 4 | 4 | | **Total** | **100 %** | **100 %** | **100 %** | **100 %** | Segment Net Sales and Gross Margin (in thousands) | Metric | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | | :-------------------- | :----------------------------- | :----------------------------- | :--------------------------- | :--------------------------- | | Retail Net Sales | $1,446,843 | $1,426,431 | $2,914,780 | $2,919,074 | | Construction Net Sales | $66,987 | $63,507 | $127,913 | $119,915 | | Retail Gross Margin | $550,925 | $557,198 | $1,219,190 | $1,246,383 | | Construction Gross Margin | $3,599 | $2,409 | $6,506 | $4,450 | - Remaining performance obligations for construction contracts totaled **$129.5 million** at August 2, 2025, a decrease of approximately **36%** from February 1, 2025, and **45%** from August 3, 2024, expected to be satisfied over the next 9 to 18 months[38](index=38&type=chunk) [Note 4. Earnings Per Share](index=16&type=section&id=Note%204.%20Earnings%20Per%20Share) Basic and diluted EPS increased to **$4.66** for the three months ended August 2, 2025, despite lower net income, due to reduced shares outstanding, but decreased for the six months Earnings Per Share (in thousands, except per share) | Metric (in thousands, except per share) | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | | :------------------------------------ | :----------------------------- | :----------------------------- | :--------------------------- | :--------------------------- | | Net income | $72,835 | $74,483 | $236,652 | $254,521 | | Weighted average shares outstanding | 15,622 | 16,233 | 15,698 | 16,232 | | Basic and diluted earnings per share | $4.66 | $4.59 | $15.08 | $15.68 | - The Company's capital structure consists solely of common stock, with no preferred stock, stock options, or other dilutive securities outstanding during the reported periods[40](index=40&type=chunk) [Note 5. Commitments and Contingencies](index=18&type=section&id=Note%205.%20Commitments%20and%20Contingencies) The company is involved in routine legal proceedings not expected to materially impact financials, with **$25.3 million** in letters of credit issued under its revolving credit facility - Management believes that the disposition of pending legal proceedings will not materially affect the Company's financial position, cash flows, or results of operations[41](index=41&type=chunk) - Letters of credit totaling **$25.3 million** were issued under the Company's revolving credit facility as of August 2, 2025[42](index=42&type=chunk) [Note 6. Benefit Plans](index=18&type=section&id=Note%206.%20Benefit%20Plans) The company's unfunded defined benefit pension plan saw decreased net periodic benefit costs due to lower actuarial losses, with **$4.3 million** contributed for six months and **$4.4 million** expected for fiscal 2025 Net Periodic Benefit Costs (in thousands) | Component | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | | :-------------------- | :----------------------------- | :----------------------------- | :--------------------------- | :--------------------------- | | Service cost | $1,439 | $1,588 | $2,878 | $3,177 | | Interest cost | $4,106 | $3,976 | $8,212 | $7,951 | | Net actuarial loss | $928 | $2,182 | $1,857 | $4,365 | | **Total Net periodic benefit costs** | **$6,473** | **$7,746** | **$12,947** | **$15,493** | - The Company contributed **$4.3 million** to its unfunded, nonqualified defined benefit Pension Plan during the six months ended August 2, 2025, and expects to make additional contributions of approximately **$4.4 million** during the remainder of fiscal 2025[43](index=43&type=chunk) [Note 7. Revolving Credit Agreement](index=18&type=section&id=Note%207.%20Revolving%20Credit%20Agreement) The company maintains an **$800 million** revolving credit facility, amended in March 2025 to reduce rates and fees, with **$774.7 million** unutilized availability and no outstanding borrowings as of August 2, 2025 - The Company's revolving credit facility provides a borrowing capacity of **$800 million**, with a **$200 million** expansion option, secured by certain deposit accounts and inventory[45](index=45&type=chunk) - In March 2025, the credit agreement was amended, reducing applicable interest rates and unused commitment fees[46](index=46&type=chunk) - As of August 2, 2025, no borrowings were outstanding, and **$774.7 million** of unutilized availability remained under the facility[47](index=47&type=chunk) [Note 8. Stock Repurchase Programs](index=20&type=section&id=Note%208.%20Stock%20Repurchase%20Programs) Under the May 2023 Stock Plan, the company repurchased **24,469 shares** for **$9.8 million** in three months and **300,013 shares** for **$107.8 million** in six months, with **$165.2 million** remaining authorization Share Repurchase Activity (in thousands, except per share data) | Metric | Three Months Ended Aug 2, 2025 | Six Months Ended Aug 2, 2025 | | :---------------------- | :----------------------------- | :--------------------------- | | Cost of shares repurchased | $9,755 | $107,752 | | Number of shares repurchased | 24 | 300 | | Average price per share | $398.67 | $359.16 | - As of August 2, 2025, **$165.2 million** of authorization remained under the May 2023 Stock Plan[49](index=49&type=chunk) [Note 9. Income Taxes](index=20&type=section&id=Note%209.%20Income%20Taxes) The company's effective income tax rate was approximately **23.0%** for three months and **23.2%** for six months ended August 2, 2025, primarily influenced by state and local income taxes Estimated Federal and State Effective Income Tax Rate | Period | August 2, 2025 | August 3, 2024 | | :-------------------- | :------------- | :------------- | | Three Months Ended | 23.0% | 23.3% | | Six Months Ended | 23.2% | 23.3% | - The difference from the statutory federal income tax rate is primarily due to the effects of state and local income taxes[50](index=50&type=chunk) [Note 10. Fair Value Disclosures](index=20&type=section&id=Note%2010.%20Fair%20Value%20Disclosures) Fair values of short-term assets approximate carrying values; long-term debt had a fair value of **$335.3 million** (carrying **$321.6 million**) and subordinated debentures **$208.2 million** (carrying **$200 million**) as of August 2, 2025 - The fair value of the Company's long-term debt and subordinated debentures are based on market prices and are categorized as Level 1 in the fair value hierarchy[52](index=52&type=chunk) Fair Value vs. Carrying Value (in millions) | Instrument | Carrying Value (Aug 2, 2025) | Fair Value (Aug 2, 2025) | | :-------------------- | :--------------------------- | :----------------------- | | Long-term debt | $321.6 | $335.3 | | Subordinated debentures | $200.0 | $208.2 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's analysis of the company's financial performance, condition, and outlook, covering operational results, financial trends, liquidity, critical accounting policies, and forward-looking statements [Executive Overview](index=22&type=section&id=Executive%20Overview) Dillard's reported a **1% increase** in Q2 2025 retail sales, with net income of **$72.8 million** and significantly increased operating cash flow of **$319.4 million** for the six months, maintaining **$1.613 billion** in working capital - Total retail sales increased **1%** and comparable store sales increased **1%** for the second quarter of 2025 compared to the prior year[56](index=56&type=chunk) Key Financial Highlights (in millions, except EPS) | Metric | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | | :---------------------- | :----------------------------- | :----------------------------- | | Net income | $72.8 | $74.5 | | EPS | $4.66 | $4.59 | | Pretax gain on disposal of assets | $4.8 | - | - Net cash provided by operating activities was **$319.4 million** for the six months ended August 2, 2025, up from **$176.0 million** in the prior year, primarily due to changes in income taxes payable[59](index=59&type=chunk) - As of August 2, 2025, the Company had working capital of **$1.613 billion**, including **$1.012 billion** in cash and cash equivalents[60](index=60&type=chunk) [Key Performance Indicators](index=23&type=section&id=Key%20Performance%20Indicators) The company utilizes key performance indicators such as net sales, comparable store sales, gross margin, SG&A as a percentage of sales, operating cash flow, store count, sales per square foot, and inventory turnover to assess performance Key Performance Indicators | Indicator | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | | :------------------------------------------------ | :----------------------------- | :----------------------------- | | Net sales (in millions) | $1,513.8 | $1,489.9 | | Retail stores sales trend | 1 % | (5)% | | Comparable retail stores sales trend | 1 % | (5)% | | Gross margin (in millions) | $554.5 | $559.6 | | Gross margin as a percentage of net sales | 36.6 % | 37.6 % | | Retail gross margin as a percentage of retail net sales | 38.1 % | 39.1 % | | Selling, general and administrative expenses as a percentage of net sales | 28.7 % | 29.1 % | | Cash flow provided by operations (in millions)* | $319.4 | $176.0 | | Total retail store count at end of period | 272 | 273 | | Retail sales per square foot | $32 | $31 | | Retail store inventory trend | 2 % | — % | | Annualized retail merchandise inventory turnover | 2.5 | 2.6 | * Cash flow from operations data is for the six months ended August 2, 2025 and August 3, 2024. [General](index=23&type=section&id=General) This section defines key financial statement line items, including net sales, service charges and other income, cost of sales, SG&A, depreciation, rentals, interest and debt expense, other expense, and gain on asset disposal [Net Sales](index=23&type=section&id=Net%20Sales) Net sales comprise merchandise sales from comparable and non-comparable stores, including online, and revenue from CDI Contractors, with sales integrated across in-store and online channels - Net sales include merchandise sales from comparable and non-comparable stores (including the internet store) and revenue from CDI Contractors, LLC[63](index=63&type=chunk) - Sales are interdependent between in-store and online channels, with fulfillment from both centers and stores, and flexible return options[64](index=64&type=chunk) [Service Charges and Other Income](index=23&type=section&id=Service%20Charges%20and%20Other%20Income) This category includes income from private label credit card alliances (Citibank replacing Wells Fargo), rental income, shipping and handling fees, and gift card breakage - Service charges and other income are generated through private label credit card portfolio alliances, including the new Citibank Alliance which replaced the Wells Fargo Alliance in September 2024[65](index=65&type=chunk) - Other income components include rental income, shipping and handling fees, and gift card breakage[65](index=65&type=chunk) [Cost of Sales](index=23&type=section&id=Cost%20of%20Sales) Cost of sales includes merchandise costs, bankcard fees, freight, discounts, shipping, salon payroll, and CDI contract costs (materials, labor, subcontracts, and indirect costs) - Cost of sales includes merchandise costs (net of discounts), bankcard fees, freight, employee/promotional discounts, shipping, and direct payroll for salon personnel[66](index=66&type=chunk) - CDI contract costs, comprising direct material, labor, subcontract costs, and indirect costs, are also included in cost of sales[66](index=66&type=chunk) [Selling, General and Administrative Expenses](index=25&type=section&id=Selling,%20General%20and%20Administrative%20Expenses) SG&A expenses cover operational costs including buying, occupancy, selling, distribution, warehousing, store and corporate expenses (payroll, benefits), insurance, employment taxes, advertising, management information systems, and legal fees - SG&A expenses include buying, occupancy, selling, distribution, warehousing, store and corporate expenses (including payroll and employee benefits), insurance, employment taxes, advertising, management information systems, and legal costs[67](index=67&type=chunk) [Depreciation and Amortization](index=25&type=section&id=Depreciation%20and%20Amortization) This line item includes depreciation and amortization expenses related to property and equipment - Depreciation and amortization expenses are recognized on property and equipment[68](index=68&type=chunk) [Rentals](index=25&type=section&id=Rentals) Rental expenses cover store leases (including contingent rent), data processing, other equipment, and office space leases - Rentals include expenses for store leases (contingent rent), data processing, other equipment, and office space leases[68](index=68&type=chunk) [Interest and Debt (Income) Expense, Net](index=25&type=section&id=Interest%20and%20Debt%20(Income)%20Expense,%20Net) This item includes interest expense on debt, net of interest income from deposits and short-term investments, capitalized interest, and amortization of financing costs - Net interest and debt (income) expense includes interest on debt, net of interest income from demand deposits and short-term investments, and amortization of financing costs[69](index=69&type=chunk) [Other Expense](index=25&type=section&id=Other%20Expense) Other expense primarily consists of interest cost and net actuarial loss components of net periodic benefit costs for the defined benefit plan, and deferred financing fee write-offs - Other expense includes interest cost and net actuarial loss components of net periodic benefit costs for the defined benefit plan, and charges for deferred financing fee write-offs[70](index=70&type=chunk) [Gain on Disposal of Assets](index=25&type=section&id=Gain%20on%20Disposal%20of%20Assets) This line item reflects the net gain or loss from the sale or disposal of property and equipment, and gains from insurance proceeds exceeding cost basis - Gain on disposal of assets includes net gains or losses from the sale or disposal of property and equipment, and gains from insurance proceeds[71](index=71&type=chunk) [Seasonality](index=25&type=section&id=Seasonality) Dillard's business is seasonal, with a significant portion of sales and income realized in the fourth fiscal quarter due to holidays, making quarterly results not indicative of full-year performance - The Company's business is seasonal, with a significant portion of sales and income typically realized during the last quarter of the fiscal year due to the holiday season[72](index=72&type=chunk) - Quarterly results are not necessarily indicative of full fiscal year results due to seasonality[72](index=72&type=chunk) [Results of Operations](index=26&type=section&id=Results%20of%20Operations) This section analyzes the company's operational performance, detailing changes in net sales, service charges, gross margin, SG&A, interest and debt expense, other expense, gain on asset disposal, and income taxes for the three and six months ended August 2, 2025 Results of Operations as a Percentage of Net Sales | Metric | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | | :---------------------------------------- | :----------------------------- | :----------------------------- | :--------------------------- | :--------------------------- | | Net sales | 100.0 % | 100.0 % | 100.0 % | 100.0 % | | Service charges and other income | 1.5 | 1.7 | 1.3 | 1.6 | | Cost of sales | 63.4 | 62.4 | 59.7 | 58.8 | | Selling, general and administrative expenses | 28.7 | 29.1 | 28.1 | 28.3 | | Depreciation and amortization | 3.0 | 3.1 | 2.9 | 3.0 | | Rentals | 0.3 | 0.3 | 0.3 | 0.3 | | Interest and debt (income) expense, net | (0.1) | (0.3) | (0.1) | (0.2) | | Other expense | 0.3 | 0.4 | 0.4 | 0.4 | | Gain on disposal of assets | (0.3) | 0.0 | (0.2) | 0.0 | | Income before income taxes | 6.2 | 6.5 | 10.1 | 10.9 | | Income taxes | 1.4 | 1.5 | 2.4 | 2.5 | | Net income | 4.8 % | 5.0 % | 7.8 % | 8.4 % | [Net Sales](index=26&type=section&id=Net%20Sales) Total net sales increased by **$23.9 million (1.6%)** for three months and **$3.7 million (0.1%)** for six months ended August 2, 2025, driven by mixed performance across retail and construction segments Net Sales by Segment (in thousands) | Segment | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | $ Change | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | $ Change | | :---------------------- | :----------------------------- | :----------------------------- | :------- | :--------------------------- | :--------------------------- | :------- | | Retail operations segment | $1,446,843 | $1,426,431 | $20,412 | $2,914,780 | $2,919,074 | $(4,294) | | Construction segment | $66,987 | $63,507 | $3,480 | $127,913 | $119,915 | $7,998 | | **Total net sales** | **$1,513,830** | **$1,489,938** | **$23,892**| **$3,042,693** | **$3,038,989** | **$3,704**| Retail Operations Segment Sales % Change by Product Category (YoY) | Product Category | % Change (3 Months Ended Aug 2, 2025 vs Aug 3, 2024) | % Change (6 Months Ended Aug 2, 2025 vs Aug 3, 2024) | | :-------------------------- | :--------------------------------------------------- | :--------------------------------------------------- | | Cosmetics | (0.8)% | (1.7)% | | Ladies' apparel | 1.5 | (1.0) | | Ladies' accessories and lingerie | 3.2 | 1.6 | | Juniors' and children's apparel | 6.0 | 4.4 | | Men's apparel and accessories | 0.6 | 0.4 | | Shoes | 1.3 | (1.6) | | Home and furniture | (2.4) | (3.6) | - The number of sales transactions decreased **2%** for both the three and six months ended August 2, 2025, while the average dollars per sales transaction increased **3%** and **2%** respectively[77](index=77&type=chunk)[80](index=80&type=chunk) [Service Charges and Other Income](index=30&type=section&id=Service%20Charges%20and%20Other%20Income) Total service charges and other income decreased by **$2.5 million (10.2%)** for three months and **$8.2 million (16.9%)** for six months ended August 2, 2025, primarily due to lower credit card alliance income and increased credit losses Service Charges and Other Income (in thousands) | Category | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | $ Change | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | $ Change | | :---------------------- | :----------------------------- | :----------------------------- | :------- | :--------------------------- | :--------------------------- | :------- | | Income from alliances | $11,298 | $12,722 | $(1,424) | $17,170 | $24,357 | $(7,187) | | Shipping and handling income | $8,265 | $8,665 | $(400) | $16,326 | $17,633 | $(1,307) | | Other | $2,577 | $3,294 | $(717) | $6,726 | $6,350 | $376 | | **Total** | **$22,173** | **$24,708** | **$(2,535)**| **$40,281** | **$48,466** | **$(8,185)**| - Income from credit card alliances decreased primarily due to lower finance charges and late fees resulting from lower average net receivables, and for the six-month period, increased credit losses[82](index=82&type=chunk) - The Company expects income from the new Citibank Alliance to initially be less than historical earnings from the former Wells Fargo Alliance[83](index=83&type=chunk) [Gross Margin](index=31&type=section&id=Gross%20Margin) Total gross margin as a percentage of sales decreased to **36.6%** for three months and **40.3%** for six months ended August 2, 2025, with retail operations declining but construction segment increasing significantly Gross Margin by Segment (in thousands) | Segment | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | $ Change | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | $ Change | | :---------------------- | :----------------------------- | :----------------------------- | :------- | :--------------------------- | :--------------------------- | :------- | | Retail operations segment | $550,925 | $557,198 | $(6,273) | $1,219,190 | $1,246,383 | $(27,193) | | Construction segment | $3,599 | $2,409 | $1,190 | $6,506 | $4,450 | $2,056 | | **Total gross margin** | **$554,524** | **$559,607** | **$(5,083)**| **$1,225,696** | **$1,250,833** | **$(25,137)**| Gross Margin as a Percentage of Segment Net Sales | Segment | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | | :---------------------- | :----------------------------- | :----------------------------- | :--------------------------- | :--------------------------- | | Retail operations segment | 38.1 % | 39.1 % | 41.8 % | 42.7 % | | Construction segment | 5.4 | 3.8 | 5.1 | 3.7 | | **Total gross margin** | **36.6 %** | **37.6 %** | **40.3 %** | **41.2 %** | - Total inventory increased **2%** at August 2, 2025, compared to August 3, 2024[89](index=89&type=chunk) - The Company is monitoring inflation and potential trade restrictions, including tariffs, which pose a risk to operations[90](index=90&type=chunk) [Selling, General and Administrative Expenses ("SG&A")](index=32&type=section&id=Selling,%20General%20and%20Administrative%20Expenses%20(%22SG%26A%22)) Total SG&A expenses slightly increased by **$0.5 million (0.1%)** for three months but decreased as a percentage of sales to **28.7%**, while for six months, total SG&A decreased by **$4.5 million (0.5%)** and to **28.1%** of sales SG&A Expenses (in thousands) | Segment | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | $ Change | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | $ Change | | :---------------------- | :----------------------------- | :----------------------------- | :------- | :--------------------------- | :--------------------------- | :------- | | Retail operations segment | $431,751 | $430,850 | $901 | $851,266 | $854,856 | $(3,590) | | Construction segment | $2,414 | $2,809 | $(395) | $4,589 | $5,477 | $(888) | | **Total SG&A** | **$434,165** | **$433,659** | **$506** | **$855,855** | **$860,333** | **$(4,478)**| SG&A as a Percentage of Segment Net Sales | Segment | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | | :---------------------- | :----------------------------- | :----------------------------- | :--------------------------- | :--------------------------- | | Retail operations segment | 29.8 % | 30.2 % | 29.2 % | 29.3 % | | Construction segment | 3.6 | 4.4 | 3.6 | 4.6 | | **Total SG&A** | **28.7 %** | **29.1 %** | **28.1 %** | **28.3 %** | - Payroll and payroll-related expenses decreased by **$0.8 million** for the three months and **$5.1 million** for the six months ended August 2, 2025, compared to the prior year periods[92](index=92&type=chunk)[94](index=94&type=chunk) [Interest and Debt (Income) Expense, Net](index=33&type=section&id=Interest%20and%20Debt%20(Income)%20Expense,%20Net) Net interest and debt income decreased by **$2.5 million** for three months and **$5.2 million** for six months ended August 2, 2025, primarily due to lower interest income Net Interest and Debt (Income) Expense (in thousands) | Segment | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | $ Change | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | $ Change | | :---------------------- | :----------------------------- | :----------------------------- | :------- | :--------------------------- | :--------------------------- | :------- | | Retail operations segment | $(1,224) | $(3,718) | $2,494 | $(1,836) | $(7,006) | $5,170 | | Construction segment | $(233) | $(216) | $(17) | $(443) | $(460) | $17 | | **Total** | **$(1,457)** | **$(3,934)** | **$2,477**| **$(2,279)** | **$(7,466)** | **$5,187**| - The decrease in net interest and debt income was primarily due to a decrease in interest income, which was **$11.5 million** for the three months and **$22.7 million** for the six months ended August 2, 2025[97](index=97&type=chunk) [Other Expense](index=33&type=section&id=Other%20Expense) Other expense decreased by **$1.1 million (18.2%)** for three months and **$1.6 million (12.9%)** for six months ended August 2, 2025, primarily due to lower amortization of net actuarial loss from the Pension Plan Other Expense (in thousands) | Segment | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | $ Change | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | $ Change | | :---------------------- | :----------------------------- | :----------------------------- | :------- | :--------------------------- | :--------------------------- | :------- | | Retail operations segment | $5,035 | $6,158 | $(1,123) | $10,728 | $12,316 | $(1,588) | | Construction segment | — | — | — | — | — | — | | **Total** | **$5,035** | **$6,158** | **$(1,123)**| **$10,728** | **$12,316** | **$(1,588)**| - The decrease in other expense was primarily due to a decrease in the amortization of the net actuarial loss related to the Company's Pension Plan[98](index=98&type=chunk) [Gain on Disposal of Assets](index=33&type=section&id=Gain%20on%20Disposal%20of%20Assets) The company recognized a significant gain on disposal of assets of **$4.8 million** for three months and **$4.9 million** for six months ended August 2, 2025, primarily from property sales Gain on Disposal of Assets (in thousands) | Segment | Three Months Ended Aug 2, 2025 | Three Months Ended Aug 3, 2024 | $ Change | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | $ Change | | :---------------------- | :----------------------------- | :----------------------------- | :------- | :--------------------------- | :--------------------------- | :------- | | Retail operations segment | $(4,828) | $(4) | $(4,824) | $(4,887) | $(255) | $(4,632) | | Construction segment | $(13) | $(9) | $(4) | $(13) | $(25) | $12 | | **Total** | **$(4,841)** | **$(13)** | **$(4,828)**| **$(4,900)** | **$(280)** | **$(4,620)**| - The gain on disposal of assets for the three and six months ended August 2, 2025, was primarily due to proceeds of **$6.0 million** from the sale of three properties[100](index=100&type=chunk)[111](index=111&type=chunk) [Income Taxes](index=34&type=section&id=Income%20Taxes) The company's effective income tax rate was approximately **23.0%** for three months and **23.2%** for six months ended August 2, 2025, with new tax legislation not expected to have a material impact Estimated Federal and State Effective Income Tax Rate | Period | August 2, 2025 | August 3, 2024 | | :-------------------- | :------------- | :------------- | | Three Months Ended | 23.0% | 23.3% | | Six Months Ended | 23.2% | 23.3% | - The H.R.1 - One Big Beautiful Bill Act, signed into law on July 4, 2025, including provisions for bonus depreciation and research expenditures, is not expected to have a material impact on the Company's financial results[103](index=103&type=chunk) [Financial Condition](index=34&type=section&id=Financial%20Condition) Net cash from operations significantly increased by **$143.4 million** for six months ended August 2, 2025, due to postponed tax payments; the company transitioned its credit card program, decreased capital expenditures, and continued stock repurchases Summary of Net Cash Flows (in thousands) | Activity | Six Months Ended Aug 2, 2025 | Six Months Ended Aug 3, 2024 | $ Change | | :-------------------- | :--------------------------- | :--------------------------- | :------- | | Operating activities | $319,393 | $175,957 | $143,436 | | Investing activities | $93,746 | $(29,403) | $123,149 | | Financing activities | $(118,982) | $(8,113) | $(110,869)| | **Total Increase in Cash and Cash Equivalents** | **$294,157** | **$138,441** | **$155,716**| - The increase in operating cash flows was primarily due to changes in income taxes payable, following a federal disaster declaration that postponed tax payment deadlines[104](index=104&type=chunk) - The Company transitioned its private label credit card program from Wells Fargo to Citibank in September 2024, with Citi establishing, owning, and managing the cards and retaining associated benefits and risks[105](index=105&type=chunk)[106](index=106&type=chunk)[107](index=107&type=chunk) - Capital expenditures were **$43.5 million** for the six months ended August 2, 2025, a decrease from **$61.1 million** in the prior year, primarily for equipment, new store construction, and remodels[110](index=110&type=chunk) - The Company repurchased **0.3 million shares** of Class A Common Stock for **$107.8 million** during the six months ended August 2, 2025, under its stock repurchase plan, with **$165.2 million** remaining authorization[115](index=115&type=chunk)[116](index=116&type=chunk) [OFF-BALANCE-SHEET ARRANGEMENTS](index=38&type=section&id=OFF-BALANCE-SHEET%20ARRANGEMENTS) The company has no special-purpose entities or off-balance-sheet arrangements likely to materially affect its financial condition, results of operations, liquidity, or capital resources - The Company is not party to any special-purpose entities or off-balance-sheet arrangements that are reasonably likely to materially affect its financial condition or results of operations[120](index=120&type=chunk) [CRITICAL ACCOUNTING POLICIES AND ESTIMATES](index=38&type=section&id=CRITICAL%20ACCOUNTING%20POLICIES%20AND%20ESTIMATES) Financial statement preparation involves estimates and assumptions, with no material changes to critical accounting policies and estimates as of August 2, 2025, from those previously disclosed - The preparation of financial statements involves estimates and assumptions, but there have been no material changes to critical accounting policies and estimates as of August 2, 2025[121](index=121&type=chunk) [NEW ACCOUNTING STANDARDS](index=38&type=section&id=NEW%20ACCOUNTING%20STANDARDS) Information on new accounting pronouncements and their potential impact on condensed consolidated financial statements is detailed in Note 2 - For information on new accounting pronouncements and their impact, refer to Note 2, Accounting Standards, in the Notes to Condensed Consolidated Financial Statements[122](index=122&type=chunk) [FORWARD-LOOKING INFORMATION](index=38&type=section&id=FORWARD-LOOKING%20INFORMATION) This report contains forward-looking statements subject to risks and uncertainties, including economic conditions, competition, and regulatory changes, with actual results potentially differing materially, and the company disclaims any obligation to update them - Forward-looking statements are based on management's estimates and assumptions and are not guarantees of future performance[123](index=123&type=chunk)[125](index=125&type=chunk) - Actual future performance may differ materially due to risks and uncertainties including general retail industry conditions, macroeconomic conditions (inflation, recession), competitive pressures, labor needs, consumer spending patterns, tax legislation, trade disputes, and global conflicts[125](index=125&type=chunk) - The Company disclaims any obligation to update or revise any forward-looking statements[125](index=125&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes have occurred in the company's quantitative and qualitative disclosures about market risk since its Annual Report on Form 10-K - No material changes have occurred in the Company's quantitative and qualitative disclosures about market risk since the last Annual Report on Form 10-K[126](index=126&type=chunk) [Item 4. Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of August 2, 2025, with no material changes in internal control over financial reporting during the fiscal quarter - The Company's disclosure controls and procedures were evaluated and deemed effective as of August 2, 2025[127](index=127&type=chunk) - No material changes in internal control over financial reporting occurred during the fiscal quarter ended August 2, 2025[128](index=128&type=chunk) [PART II. OTHER INFORMATION](index=41&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section provides other information, including legal proceedings, risk factors, equity security sales, other disclosures, and exhibits [Item 1. Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) As of September 5, 2025, the company is not involved in any legal proceedings expected to materially adversely affect its business or financial condition - The Company is not involved in any legal proceedings that are expected to have a material adverse effect on its business or financial condition[130](index=130&type=chunk) [Item 1A. Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred in the company's risk factors since its Annual Report on Form 10-K - No material changes have occurred in the Company's risk factors since the last Annual Report on Form 10-K[131](index=131&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the three months ended August 2, 2025, the company repurchased **24,469 shares** for **$9.8 million** under its May 2023 Stock Plan, with **$165.2 million** remaining authorization Issuer Purchases of Equity Securities (Three Months Ended August 2, 2025) | Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs | | :---------------------- | :------------------------------- | :--------------------------- | :------------------------------------------------------------------------------- | :--------------------------------------------------------------------------------------- | | May 4, 2025 through May 31, 2025 | — | $— | — | $174,970,857 | | June 1, 2025 through July 5, 2025 | 24,469 | $398.67 | 24,469 | $165,215,709 | | July 6, 2025 through August 2, 2025 | — | $— | — | $165,215,709 | | **Total** | **24,469** | **$398.67** | **24,469** | **$165,215,709** | - As of August 2, 2025, **$165.2 million** of authorization remained under the May 2023 Stock Plan[133](index=133&type=chunk) [Item 5. Other Information](index=41&type=section&id=Item%205.%20Other%20Information) No Rule 10b5-1 trading arrangements were adopted or terminated by the company's directors or officers during the three months ended August 2, 2025 - No Rule 10b5-1 trading arrangements were adopted or terminated by the Company's directors or officers during the three months ended August 2, 2025[135](index=135&type=chunk) [Item 6. Exhibits](index=43&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including organizational documents, Sarbanes-Oxley certifications, and XBRL-related documents - The exhibits include organizational documents (Plan of Conversion, Certificate of Elimination, Certificate of Formation, Bylaws), certifications (Section 302 and 906 of Sarbanes-Oxley Act), and XBRL instance and taxonomy documents[136](index=136&type=chunk) [SIGNATURES](index=44&type=section&id=SIGNATURES) The report is duly signed on behalf of Dillard's, Inc. by its Senior Vice President, Co-Principal Financial Officer, and Principal Accounting Officer, Phillip R. Watts, and Senior Vice President and Co-Principal Financial Officer, Chris B. Johnson - The report is signed by Phillip R. Watts, Senior Vice President, Co-Principal Financial Officer and Principal Accounting Officer, and Chris B. Johnson, Senior Vice President and Co-Principal Financial Officer[138](index=138&type=chunk)

Core Viewpoint - Dillard's, Inc. has declared a cash dividend of $0.30 per share on its Class A and Class B Common Stock, reflecting the company's commitment to returning value to shareholders [1] Group 1 - The dividend is scheduled to be payable on November 3, 2025 [1] - Shareholders of record must be noted by September 30, 2025 to receive the dividend [1]

Core Viewpoint - Dillard's has been upgraded to a Zacks Rank 1 (Strong Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [4][6]. - Rising earnings estimates for Dillard's suggest an improvement in the company's underlying business, likely leading to an increase in stock price [5][10]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7][9]. - Only the top 5% of Zacks-covered stocks receive a "Strong Buy" rating, indicating superior earnings estimate revisions [9][10]. Recent Earnings Estimate Revisions - For the fiscal year ending January 2026, Dillard's is expected to earn $30.62 per share, unchanged from the previous year, but the Zacks Consensus Estimate has increased by 4.6% over the past three months [8].

Group 1: Ardmore Shipping (ASC) - Ardmore Shipping is engaged in the ownership and operation of product and chemical tankers, carrying a Zacks Rank 1 (Strong Buy) [1] - The Zacks Consensus Estimate for Ardmore Shipping's current year earnings has increased by 2.6% over the last 60 days [1] - The company has a price-to-earnings ratio (P/E) of 9.15, significantly lower than the industry average of 19.5, and possesses a Value Score of A [2] Group 2: Dillard's (DDS) - Dillard's is a large departmental store chain featuring fashion apparel and home furnishings, also carrying a Zacks Rank 1 [2] - The Zacks Consensus Estimate for Dillard's current year earnings has increased by 2.6% over the last 60 days [2] - Dillard's has a price-to-earnings ratio (P/E) of 16.25, which is lower than the industry average of 19.80, and possesses a Value Score of A [3] Group 3: Healthcare Services Group (HCSG) - Healthcare Services Group provides housekeeping, laundry, linen, facility maintenance, and food services to the healthcare industry, including nursing homes and hospitals, and carries a Zacks Rank 1 [4] - The Zacks Consensus Estimate for Healthcare Services Group's current year earnings has increased by 4.8% over the last 60 days [4] - The company has a price-to-earnings ratio (P/E) of 17.31, compared to the industry average of 21.10, and possesses a Value Score of A [5]

Company Overview - Dillard's (DDS) currently holds a Momentum Style Score of B, indicating potential for strong performance based on recent trends [3] - The company has a Zacks Rank of 1 (Strong Buy), which is associated with a historical track record of outperforming the market [4] Price Performance - Over the past week, Dillard's shares have increased by 9.47%, outperforming the Zacks Retail - Regional Department Stores industry, which rose by 7.76% [6] - In a longer time frame, Dillard's shares have risen by 28.3% over the past quarter and 50.01% over the last year, while the S&P 500 has only moved 8.58% and 17.39%, respectively [7] Trading Volume - The average 20-day trading volume for Dillard's is 131,782 shares, which serves as a baseline for assessing price movements [8] Earnings Estimates - In the past two months, two earnings estimates for Dillard's have been revised upwards, increasing the consensus estimate from $29.84 to $30.97 [10] - For the next fiscal year, two estimates have also moved upwards with no downward revisions during the same period [10] Conclusion - Considering the positive price trends, strong earnings outlook, and favorable trading volume, Dillard's is positioned as a solid momentum pick with a 1 (Strong Buy) rating and a Momentum Score of B [12]

Group 1 - The previous investment stance on Dillard's (NYSE: DDS) was a sell rating due to expected pressure on EPS, declining sales, and contracting margins [1] - After reviewing 2Q25, the focus is shifting towards long-term investments while also considering short-term shorts to identify alpha opportunities [1] - The investment strategy is based on bottom-up analysis, emphasizing the fundamental strengths and weaknesses of individual companies [1] Group 2 - The investment duration is medium to long-term, aiming to identify companies with solid fundamentals, sustainable competitive advantages, and growth potential [1]

Core Insights - Dillard's Inc. reported second-quarter fiscal 2025 results with earnings per share (EPS) of $4.66, exceeding the Zacks Consensus Estimate of $3.79, and a year-over-year increase of 1.5% from $4.59 [1][9] - Net sales reached $1.514 billion, reflecting a 1.6% increase from the prior-year quarter, aligning closely with consensus estimates [2][9] - The company's stock price rose approximately 3.4% following the earnings announcement, indicating strong investor confidence [3] Financial Performance - Total retail sales, excluding CDI Contractors, increased by 1.5% year over year to $1.447 billion, with comparable store sales also rising by 1% [5][9] - The consolidated gross margin contracted by 100 basis points year over year to 36.6%, with retail gross margin at 38.1%, also down 100 basis points [6] - Selling, general and administrative expenses (SG&A) as a percentage of sales decreased to 28.7%, down 40 basis points from the prior-year quarter, with total SG&A expenses increasing by 0.1% year over year to $434.2 million [10][11] Cash Flow and Shareholder Returns - Dillard's ended the quarter with cash and cash equivalents of $1.012 billion and long-term debt of $225.6 million, alongside total shareholders' equity of $1.919 billion [12] - The company repurchased 24,500 shares for $9.8 million at an average price of $398.7 per share, with $165.2 million remaining under its current share repurchase authorization [13] Future Outlook - Dillard's forecasts capital expenditure of $120 million for fiscal 2025, an increase from $105 million in fiscal 2024 [14] - The company expects depreciation and amortization expenses of $180 million and projects interest and debt income of $7 million for fiscal 2025 [15]

Core Insights - The article emphasizes the importance of liquidity in assessing a company's ability to meet debt obligations and suggests that companies with adequate liquidity can drive business growth and deliver higher returns [1][2][3] Group 1: Liquidity Measures - Current Ratio: A measure of current assets relative to current liabilities, with an ideal range of 1-3 indicating a healthy balance [4] - Quick Ratio: Indicates a company's ability to pay short-term obligations, with a desirable ratio of more than 1 [5] - Cash Ratio: The most conservative measure, focusing on cash and cash equivalents relative to current liabilities, with a ratio greater than 1 being desirable but potentially indicating inefficiency [6] Group 2: Screening Parameters - Asset Utilization: A measure of efficiency, calculated as total sales over the last 12 months divided by the average total assets, with a higher ratio than the industry average indicating efficiency [7] - Growth Score: A proprietary measure added to ensure that liquid and efficient stocks have solid growth potential, with a score of A or B indicating better performance [8] Group 3: Stock Recommendations - The New York Times Company (NYT): Reported second-quarter 2025 adjusted earnings per share of 58 cents, exceeding estimates, with total revenues of $685.9 million, a 9.7% year-over-year increase [11][12] - Dillard's, Inc. (DDS): Reported second-quarter 2025 net sales of $1.5 billion, up 1.6% year over year, with adjusted earnings per share of $4.66, surpassing estimates by 23% [14][15] - Newmont Corporation (NEM): Achieved second-quarter revenues of approximately $5.32 billion, a 20.8% increase from the prior year, driven by higher gold prices [17][18] - Frontdoor, Inc. (FTDR): Reported revenues of $617 million for the last quarter, a 14% year-over-year increase, with a gross margin expansion of 130 basis points to 58% [20][21]

Core Insights - The article emphasizes the importance of cash flow in the oil and natural gas sector, highlighting that companies generating strong cash flow present significant value and growth opportunities [1]. Company and Industry Summary - Crude Value Insights provides an investment service and community focused on oil and natural gas, concentrating on cash flow and the companies that generate it [1]. - Subscribers have access to a model account with over 50 stocks, detailed cash flow analyses of exploration and production (E&P) firms, and live discussions about the sector [2]. - A promotional offer is available for a two-week free trial, encouraging potential subscribers to explore the oil and gas investment opportunities [3].