Cato

Cato Q3 Profit Beats Estimate

In Industry News, Reports, What's New by Accessories StaffLeave a Comment

CatoCharlotte, NC—A surprisingly strong October pushed Cato Corp. into a better-than-expected third quarter earnings report, the company reported last week.

For the three months ended Oct. 29, Cato posted a net income increase of 5% to $4.9 million, or 17 cents a share, compared with $4.7 million, or 16 cents a share, in the year-ago period. Analysts’ average estimate expected 14 cents a share.

Net sales were up 1% to $198.8 versus the consensus estimate for $201.2 million in sales. Comparable store sales fell 1%.

Forecast In-Line

“Our third-quarter results were above expectations and were primarily the result of a stronger-than-estimated October,” said John Cato, chairman, president/ceo.

Gross margin widened to 35.2% from 34.0% last year, primarily due to higher merchandise margin. Sales, general and administrative expenses increases to 30.7% from 29.5% last year due to store fixture write-offs and accrued incentive compensation offset by lower insurance expense.

Cato said that the company expects fourth quarter sales results will be “in line with our year-to-date trend with same-store sales in the range of down 3% to flat.”

The company forecast fourth quarter earnings to be in the range of 17 cents to 23 cents a share. Analysts’ consensus is for 20 cents a share.

For its fiscal year, Cato forecast earnings in the range of $1.90 to $1.96 a share, down from $2.11 last year. Analysts’ estimate is for $1.90 a share.

So far this year, Cato has opened 16 new stores, relocated four and closed eight. The company operates 1,318 stores in 32 states.

 

It's only fair to share...
Share on FacebookTweet about this on TwitterPin on PinterestShare on LinkedInPrint this pageEmail this to someone