For the quarter ended May 4, the department store retailer posted earnings of $117.2 million, or $2.50 a share, compared to $95 million, or $1.89 a share, in first quarter 2012.
Excluding one-time items such as a $7.6 million after tax gain “related to the sale of an investment,” a $1 million after-tax credit related to a pension adjustment and after-tax impairments and store closing charges of $4.2 million, Dillard’s adjusted earnings rose 19% to $112.8 million, or $2.40 a share. That was still strong enough to beat analysts’ average estimate for $2.11 a share.
Net sales, including CDI Contractors LLC, was flat at $1.549 billion, flat compared to the same quarter last year and missing analysts’ estimate by $6 million.
Retail Bestseller: Women’s Accessories
Merchandise revenue, which excludes revenue from CDI, increased to $1.53 billion from $1.52 billion. Merchandise comparable store sales rose 1% compared to a 5% increase in first quarter 2012.
During the quarter, women’s accessories and lingerie as well as juniors’ and children’s apparel were the outperforming categories, offset by lowest sales at the home and furniture categories. The best performing region was Central, followed by the East and West.
“We are reporting a strong start to 2013 in spite of unseasonably cool weather,” Dillard’s CEO William T. Dillard II said. “Positive comparable stores sales and gross margin expansion combined with good expense control led to another quarter of record profitability at Dillard’s.
Gross margin from retail operations (which excludes CDI) improved 110 basis points of sales to 39.9% for the quarter compared to 38.8% for the prior-year first quarter. Consolidated gross margin improved 130 basis points of sales to 39.5% from 38.2% during the prior year first quarter. Inventory increased 3%.
Dillard’s, which operated 283 stores and 18 clearance centers as of the end of the quarter, also announced that its “strong cash flow” allow it to repurchase shares. During the first quarter, Dillard’s bought back 1.4 million shares of stock for $114.7 million of Class A Common Stock at an average price of $79.12 a share under the company’s 2013 and 2012 stock plans. As of May 4, total shares outstanding of Class A and B Common Stock was 46.3 million, down from 4.91 million in the first quarter of last year.