Cato(US:CATO)2021-11-18 16:00Sales Performance - Total retail sales for the third quarter of fiscal 2021 were $170.5 million, a 14% increase from $149.2 million in the same period last year[81]. - For the nine months ended October 30, 2021, total retail sales reached $587.7 million, a 42% increase compared to $414.3 million for the same period in the previous year[82]. - Same-store sales increased by 14% in the third quarter and 41% for the nine months ended October 30, 2021, primarily due to stores being open compared to limited hours in the prior year[81][82]. Cost and Expenses - Cost of goods sold was $104.2 million, or 61.1% of retail sales for the third quarter, down from 73.3% in the same period last year[85]. - Gross margin dollars increased by 66.6% to $66.3 million for the third quarter and by 175.9% to $244.2 million for the first nine months of fiscal 2021[85]. - Selling, general and administrative expenses were $62.5 million, or 36.6% of retail sales for the third quarter, compared to $51.9 million, or 34.8% in the prior year[87]. - Depreciation expense was $3.2 million, or 1.9% of retail sales for the third quarter, down from $3.6 million, or 2.4% in the same period last year[88]. Store Operations - The company operated 1,324 stores at October 30, 2021, compared to 1,347 stores at the end of the previous year's third quarter[82]. - The company expects to open fewer than 10 stores and close approximately 25 stores in fiscal 2021[82]. Impact of COVID-19 - The ongoing COVID-19 pandemic continues to impact sales and operations, with uncertainties affecting consumer confidence and supply chain disruptions[78][80]. Income and Tax - Interest and other income decreased to $0.5 million (0.3% of retail sales) for the three months ended October 30, 2021, down from $0.8 million (0.5% of retail sales) in the same period of fiscal 2020[89]. - Income tax benefit for the third quarter was $5.7 million, compared to $9.7 million in the same quarter of fiscal 2020, with an effective tax rate of 4.3% for the first nine months of fiscal 2021 versus 36.7% in 2020[90]. Cash Flow and Working Capital - Cash provided by operating activities increased to $79.4 million in the first nine months of fiscal 2021, compared to a cash outflow of $26.1 million in the same period of fiscal 2020, reflecting a $105.5 million improvement[92]. - Working capital rose to $147.4 million as of October 30, 2021, from $108.6 million at January 30, 2021, primarily due to higher inventory and accounts receivable[93]. Financing and Investments - The company had an unsecured revolving credit agreement allowing borrowings of up to $35.0 million, with no borrowings outstanding as of October 30, 2021[94]. - Capital expenditures totaled $1.8 million in the first nine months of fiscal 2021, significantly lower than $11.2 million in the same period last year, with an expected total of approximately $4.1 million for the full fiscal year[95]. - Net cash used in investing activities was $51.3 million in the first nine months of fiscal 2021, compared to $57.9 million provided in the same period of 2020[96]. - Net cash used in financing activities decreased to $21.3 million in the first nine months of fiscal 2021 from $24.3 million in the comparable period of fiscal 2020, primarily due to lower dividends and stock repurchases[97]. - The company maintained a quarterly dividend of $0.17 per share as of November 18, 2021[99]. - The investment portfolio primarily consists of corporate bonds and government debt securities rated A or better, with maturities ranging from two days to five years[101].