Dillard's(US:DDS)2024-05-16 20:16Financial Performance - Dillard's reported net income of $180.0 million, or $11.09 per share, for the first quarter, down from $201.5 million, or $11.85 per share, in the prior year[2]. - Total retail sales decreased by 1% to $1.493 billion compared to $1.515 billion in the previous year, with comparable store sales down by 2%[4]. - Retail gross margin improved to 46.2% of sales from 45.6% in the prior year, while consolidated gross margin increased to 44.6% from 43.7%[6][7]. - Operating expenses rose to $426.7 million, representing 27.5% of sales, compared to $406.4 million, or 25.7% of sales, in the previous year[9]. - Total shares outstanding decreased to 16.2 million from 16.8 million year-over-year[11]. Inventory and Operations - Inventory decreased by 2% year-over-year, reflecting effective inventory control measures[8]. - The company opened a new location in Sioux Falls, South Dakota, marking its 30th state of operation[10]. - Dillard's cash and short-term investments exceeded $1 billion for the first time in its history[1]. - Estimated capital expenditures for 2024 are projected at $130 million, slightly down from $133 million in 2023[15]. Merchandise Performance - The company noted that cosmetics was the strongest performing merchandise category, while men's apparel and accessories were the weakest[4]. Risks and Uncertainties - The company cautions that forward-looking statements are based on estimates and assumptions, and actual future performance may differ materially due to various risks and uncertainties[16]. - Factors affecting future performance include general retail industry conditions, macro-economic conditions such as inflation and rising interest rates, and potential U.S. Federal government shutdown[16]. - The company highlights risks related to consumer spending patterns, labor shortages, and competition from other retail channels including online retailers[16]. - Changes in tax legislation and governmental regulations may impact the company's operations and financial performance[16]. - The company is monitoring the effects of global conflicts and public health issues on consumer spending and supply chain efficiencies[17]. - The company emphasizes the importance of stable availability and pricing of materials and labor for sourcing merchandise[16]. - The company acknowledges the potential impact of system failures or data security breaches on its operations[16]. Strategic Considerations - Future acquisitions of store properties from other department store operators are being considered as part of the company's strategy[16]. - The company is focused on maintaining adequate financing to support future business needs[16]. - The company will continue to assess the impact of economic conditions on its customers' buying patterns and overall retail performance[16].