Dillard's posts disappointing Q1 profits

By

Monica Karski

Published
May 17, 2015

Dillard's Inc. on Thursday reported a drop in profit for the first quarter, as lower gross margins and higher expenses offset a mediocre revenue growth, with both earnings and revenue falling short of Wall Street estimates.

The company reported net income for the 13 weeks ended May 2, 2015 of $109.6 million compared to net income of $111.7 million for the prior year first quarter.

Dillard’s Chief Executive Officer, William T. Dillard, II, stated, "We are disappointed with our first quarter performance. Our 1% sales decline hampered our ability to leverage operating expenses and to drive net income growth. Although inventory is higher than we would like, we believe the levels are manageable."

Net sales for the 13 weeks ended May 2, 2015 were $1.574 billion and $1.551 billion for the 13 weeks ended May 3, 2014. 

Sales trends were strongest in the juniors' and children's apparel category followed by shoes and ladies' apparel. Sales were notably weak in the home and furniture category. Sales trends were strongest in the Eastern region, followed by the Central and Western regions, respectively.

Dillard’s, Inc. ranks among the nation’s largest fashion retailers, with annual sales exceeding $6.6 billion. The company operates 274 Dillard’s locations and 23 clearance centers spanning 29 states, plus an Internet store.