Cato Reports Second Quarter Net Profit | State / Regional

CHARLOTTE, North Carolina, August 19, 2021 / PRNewswire / – The Cato Corporation (NYSE: CATO) today reported net income of $ 14.0 million Where $ 0.62 per diluted share for the second quarter ended July 31, 2021, compared to a net loss of $ 7.2 million Where ($ 0.30) per diluted share for the second quarter ended August 1, 2020.

Fiscal 2020 sales were strongly impacted by the closure of our stores for six weeks due to the COVID-19 pandemic, as of March 19, 2020. Due to the impact of unprecedented closings, the Company will post sales from the past two years. Revenue for the second quarter ended July 31, 2021 were $ 206.0 million, a 24% increase in sales of $ 166.3 million for the second quarter ended August 1, 2020. Compared to the same period in 2019, sales decreased by 2% compared to sales of $ 210.4 million for the quarter ended Aug 3, 2019. The Company’s comparable store sales for the quarter increased 23% compared to 2020 and decreased 5% compared to the same period in 2019.

For the past six months July 31, 2021, the Company reported net income of $ 34.7 million Where $ 1.54 per diluted share, against a net loss of $ 35.6 million Where ($ 1.48) per diluted share for the half-year ended August 1, 2020. Sales for the half-year ended July 31, 2021 were $ 417.2 million, a 57% increase in sales of $ 265.1 million for the six months ended August 1, 2020. Compared to the same period in 2019, sales decreased by 5% compared to sales of $ 438.4 million for the six months ended August 3, 2019. Year-to-date comparable store sales have increased 56% from 2020 and are down 7% from the same period in 2019.

“Our sales were favorably impacted during the first half of the year by increased vaccine availability associated with pent-up demand, an increase in social events, summer vacation travel and an early return to work for many. customers, but have been tempered by late shipments of goods driven by continued supply chain disruptions, ”said Jean Caton, Chairman of the Board, President and Chief Executive Officer. “We expect to see some impact on the business due to the increase in COVID cases, but we don’t expect to see the same level of impact on the business as in 2020.”

Gross margin increased from 20.2% to 43.9% of sales in the quarter due to higher merchandise margins. Selling and administrative expenses as a percentage of sales increased from 26.4% to 34.5% of sales in the quarter, mainly due to the increase in payroll taxes / bonuses and operating expenses of the stores, as opening hours have increased significantly from the gradual reopening of stores the previous year following extended store closures due to COVID. The tax charge for the quarter was $ 4.6 million against one $ 3.9 million the previous year due to the pre-tax loss. The Company ended the quarter with unallocated cash and short-term investments of $ 216.9 million. This compares with $ 137.0 million for the same period in 2020.

Year-to-date gross margin increased to 42.6% of sales from 18.4% the previous year, mainly due to increased margins on merchandise. The SG&A rate since the start of the year was 32.2% versus 36.4% mainly due to the leverage of expenses resulting from normalized sales and a $ 5.3 million non-cash impairment charge during the previous year, partially offset by the increase in social charges / premiums and store operating charges. The tax charge for the first half of the year amounts to $ 7.6 million against one $ 13.0 million profit last year.

From July 31, 2021, the Company has 1,325 stores in 32 states, compared to 1,333 stores in 31 states as of August 1, 2020.

“As infections continue to increase both overseas and in the United States, we have temporarily reinstated our associate mask policy in our stores, DC and Home Office, regardless of immunization status,” Mr Cato said. “As always, the safety of our associates and customers remains our priority as we continue to navigate this challenging retail environment and strive to provide our customers with a safe place to shop.”

As COVID infections continue to rise due to the Delta variant, there remains a high level of uncertainty as to the impact COVID will have on the second half of the year. Additionally, the continued impact of supply chain disruption remains a concern. In view of these uncertainties, we remain cautiously optimistic for the remainder of the year.

The Cato Corporation is a leading specialty retailer of discount fashionable clothing and accessories that operates three concepts, “Cato”, “Versona” and “It’s Fashion”. The company’s Cato stores offer exclusive merchandise with a fashion and quality comparable to specialty stores in everyday low-cost malls. The Company also offers exclusive merchandise found in its Cato stores at www.catofashions.com. Versona is a one-stop fashion destination offering clothing and accessories including jewelry, handbags and shoes at great prices every day. Some Versona products are also available at www.shopversona.com. It’s Fashion offers fashion with an emphasis on the latest trendy styles for the whole family at low prices every day.

Statements in this press release which express any belief, expectation or intention, as well as those which are not historical fact, Iincluding, without limitation, statements regarding the Company’s expected or estimated operating financial results, activities or opportunities, and the potential impacts and effects of the coronavirus are considered “forward-looking” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations which are subject to known and unknown risks, uncertainties and other factors which could cause actual results to differ materially from those contemplated by forward-looking statements. These factors include, but are not limited to,, any real or perceived deterioration in the conditions that boost consumer confidence and spending, including, but not limited to, social, economic, political and public health conditions and uncertainties, unemployment levels, labor costs, fuel, energy and food, wage rates, tax rates, interest rates, home values, consumer equity and credit availability; changes in laws or regulations affecting our business, including, but not limited to, pricing; uncertainties regarding the impact of any government action regarding, or responses to, the above conditions; competitive factors and pricing pressures; our ability to predict and respond to fashion trends and rapidly changing consumer demands; our ability to successfully implement our new store development strategy to increase new store openings and the ability of those new stores to grow and operate as planned; adverse weather conditions, threats to public health (including the global coronavirus epidemic (COVID-19)) or similar conditions that may affect our sales or operations; inventory risks due to changes in market demand, including the ability to liquidate excess inventory at expected margins; and other factors discussed under “Risk Factors” in Part I, Item 1A of the last annual report filed by the Company on Form 10-K and in other reports that the Company files or provides to the SEC from time to time. to other. The Company does not undertake to publicly update or revise any forward-looking statements, even if experience or future changes clearly indicate that the projected results expressed or implied therein will not be achieved. The Company is not responsible for changes made to this press release by wire or Internet services.

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SOURCE The Caton company