Dillard's Inc. on Monday reported that its fourth-quarter profit declined 26 percent on heavier markdowns. For the fiscal year, the Little Rock-based retailer posted a dip of 3.6 percent.
The company reported fourth-quarter net income of $119.1 million, or $2.71 per share, down 26 percent from a profit of $161.4 million, or $3.36 per share, in the previous fourth quarter.
The fourth-quarter balance sheet included a net after-tax credit of $800,000, or 2 cents per share, the company said. It noted that fourth-quarter 2012 benefited from a much larger credit totaling $23.9 million and without it would have reported a more comparable profit of $137.6 million, or $2.87 per share.
Net sales came to $2.034 billion, down 3 percent from $2.106 billion in the previous quarter, though total merchandise sales increased 1 percent and sales in comparable stores increased 2 percent for the fourth quarter, Dillard's said.
"Although it was a profitable fourth quarter, we are disappointed in our gross margin performance, as lower than anticipated sales necessitated heavier markdowns," Dillard's Chief Executive Officer William T. Dillard II said in a statement. "We are pleased with our expense control as well as with our strong cash flow for the year."
Gross margin from retail operations decreased 180 basis points of sales to 32.8 percent for the quarter, compared with 34.6 percent for the year-ago period.
For the full year that ended Feb. 2, Dillard's reported a profit of $323.7 million, or $7.10 per share, a 3.6 percent decline from the $336 million, or $6.87 per share, profit in fiscal 2012.
The retailer said the full-year results included an after-tax credit totaling $5.1 million, or 11 cents per share, and without it would have reported a $318.6 million profit, or $6.99 per share, for the year. That compares with the previous fiscal year, which benefited from a net after-tax credit of $26.2 million, or 54 cents per share, and otherwise would have posted a net income of $309.8 million, or $6.33 per share.
Net sales for the fiscal year were $6.439 billion, down slightly from $6.489 billion in fiscal 2012.
The company, which closed six stores during fiscal 2013, operates 278 Dillard's locations and 18 clearance centers in 29 states.
Read tomorrow's Arkansas Democrat-Gazette for full details.