DOW JONES NEWSWIRES
Dillard's Inc.'s (DDS) fiscal second-quarter loss narrowed
despite a drop in sales, as the department-store operator's efforts
to manage inventory and cut costs paid off.
Retailers have been suffering from a steep drop in consumer
spending and department stores have been among the worst hit retail
segments, posting weak results over the past year. Dillard's and
its peers have responded by planning conservative inventories to
lessen markdowns and preserve margins as sales have shown no real
sign of improvement.
For the period ended Aug. 1, Dillard's reported a loss of $26.7
million, or 36 cents a share, compared with a year-ago loss of
$38.3 million, or 51 cents a share. The prior-year quarter's
results included a net gain of 7 cents a share.
Earlier this month, the company reported total sales fell 15% as
same-store sales tumbled 13%. Total merchandise sales for the full
quarter fell 15%.
Dillard's, which operates in 29 states, last reported monthly
same-store sales growth in July 2008.
Gross margin grew to 29.9% from 29.7%, because of efforts to
manage inventory and minimize markdowns. Inventory was lowered by
18% in comparable stores, and down 19% companywide.
"We were pleased to realize continued significant benefits from
our aggressive actions pertaining to inventory management, expense
reduction and cash conservation," said Chief Executive William
Dillard II.
Shares were down 4.5% to $9.99 in after-hours trading. The stock
has more than doubled this year, although it is still under the
52-week high of $15.37 set in September.
-By John Kell and Alexandra Scaggs, Dow Jones Newswires;
212-416-2480; john.kell@dowjones.com;