Dillard’s Inc. announced its second quarter operating results early Thursday morning, with reported net income of $185.7 million, or $8.81 per share.
That’s compared to a net loss of $8.6 million, or $0.37 per share, for the prior year’s second quarter. Included in net loss for the prior year second quarter is a net tax benefit of $17.4 million ($0.75 per share) related to the Coronavirus Aid, Relief and Economic Security Act (CARES Act).
In a statement, Dillard’s CEO William T. Dillard II said, “The strong consumer demand we saw in the first quarter continued throughout the second quarter. This momentum, combined with our continuing focus on inventory and expense control, produced a sequential record performance. We ended the quarter with $670 million in cash even after repurchasing $112 million of stock.”
Net sales for the quarter were $1,570.4 million compared to $919.0 million a year ago. These figures include the operation of the company’s construction business, CDI Contractors (CDI).
Total retail sales (which excludes CDI) increased 72 percent from 2020 to $1,539.4 million. Sales in ladies’ apparel and shoes significantly outperformed other merchandise categories during the quarter, the company reported.
Total retail sales were up 12 percent and in-store sales rose 14 percent from the same period in 2019.
Consolidated gross margin (which includes CDI) for the quarter improved significantly to 41 percent, up from a 30 percent increase for the prior year second quarter. Retail gross margin (which excludes CDI) was up 42 percent, compared to 31 percent a year ago.
Dillard’s attributed the substantial improvement in gross margin to stronger consumer demand and better inventory management leading to decreased markdowns in the second quarter of 2021.
Consolidated selling, general and administrative expenses (operating expenses) were $365.9 million (23 percent of sales) compared to $267 million (29 percent of sales) a year ago. The decrease is attributed primarily to decreased payroll and payroll-related expenses as the company continues to operate with reduced operating hours, requiring fewer associates.
For the quarter, Dillard’s purchased $112 million (approximately 700,000 shares) of Class A Common Stock under its March 2018 share repurchase program. Total shares outstanding (Class A and Class B common stock) as of July 31 were 20.7 million, down from 22.6 million a year ago.
Currently, Dillard’s operates 249 retail locations and 31 clearance centers (including one in Pine Bluff) spanning 29 states.
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