Inventory, cost controls pay off for Dillard’s in Q3

Dillard’s turned a profit in the third quarter as it kept a tight lid on inventory and cut expenses by $100 million. The company warned, however, it "expects to be in a net operating loss position for the fiscal year."

The department store retailer reported net income of $31.9 million or $1.43 per share, for the quarter ended Oct. 31, compared to net income of $5.5 million, or $0.22 per share, for the year-ago quarter.

Net sales totaled $1 billion, down from $1.3 billion in the period last year. Net sales include the operations of the company’s construction business, CDI Contractors. Total retail sales (which excludes Dillard’s CDI Contractors construction business) fell about 25% to $994.6 million. 

Same-store sales fell 24%. Sales of home and furniture significantly outperformed other categories followed by women’s accessories and lingerie and cosmetics.  
 
“We have worked hard on inventory and expense control in unpredictable conditions throughout the pandemic,” CEO William Dillard, II. We achieved a 249 basis point gross margin improvement for the third quarter with ending inventory down 22%. Additionally, we cut expenses by $100 million."