Cost cutting drives Dillard’s to profit

Little Rock, Ark. -- Inventory reductions and improved gross margins helped Dillard’s nearly triple its profit in the first quarter.

The 315-unit department store company posted net income of $7.7 million, or 10 cents per share, for the quarter ended May 2, vs. $2.7 million, or 4 cents per share, in last year’s first quarter.

The 2009 results included a $900,000 after-tax gain related to note repurchasing as well as $600,000 in asset impairment and store closing charges.

Sales fell 16% to $1.47 billion, with comps off 13%.

Dillard’s cut inventory 18% compared to the year-ago period, driving down comp store inventory by 17%. At the same time, merchandise gross margin improved by 150 basis points.

 “We will continue to maintain our conservative fiscal posture while focusing on further improving our merchandise assortments to position Dillard’s well for the long term,” said ceo William Dillard II.

Home & Textiles Today Staff | News & Commentary

 Home Textiles Today is the market-leading brand covering the home and textiles markets, offering a comprehensive package of print and online products. Home & Textiles Today provides industry news, product trends and introductions, exclusive industry research, consumer data, store operations solutions, trade show news and much more.

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