Cato(US:CATO)2024-11-25 15:00Financial Performance - The Cato Corporation reported a net loss of $15.1 million or ($0.79) per diluted share for Q3 2024, compared to a net loss of $6.1 million or ($0.30) per diluted share for Q3 2023[3]. - For the nine months ended November 2, 2024, the company reported a net loss of $4.0 million or ($0.24) per diluted share, compared to a net loss of $0.5 million or ($0.02) per diluted share for the same period in 2023[5]. Sales Performance - Sales for Q3 2024 were $144.6 million, an 8% decrease from $156.7 million in Q3 2023, with same-store sales down 3%[4]. - Year-to-date sales were $486.8 million, an 8% decrease from $528.2 million in the prior year, with same-store sales down 4%[5]. Cost and Margin Analysis - Gross margin decreased from 32.5% to 28.8% of sales in Q3 2024 due to higher markdowns and increased freight, distribution, and occupancy costs[6]. - Year-to-date gross margin decreased to 33.3% from 34.6% in the prior year, primarily due to increased occupancy, freight, and distribution costs[7]. - SG&A expenses as a percentage of sales increased from 39.4% to 40.0% in Q3 2024, primarily due to payroll cost deleveraging[6]. Operational Changes - The company opened one store in Q3 2024, resulting in a total of 1,167 stores as of November 2, 2024, down from 1,245 stores a year earlier[8]. Challenges and Outlook - The company is facing challenges in Q4 2024 due to supply chain issues and higher costs associated with moving inventory[6]. - Tax expense for Q3 2024 was $0.3 million compared to a tax benefit of $4.3 million in the prior year, mainly due to valuation allowances against net deferred tax assets[6].