Exhibit 99.1
Dillard's, Inc. Reports Record First Quarter Earnings Per Share
LITTLE ROCK, Ark.--(BUSINESS WIRE)--May 20, 2006--Immediately
prior to its annual meeting today, Dillard's, Inc. (NYSE:DDS) (the
"Company" or "Dillard's") announced operating results for the 13 weeks
ended April 29, 2006. This release contains certain forward-looking
statements. Please refer to the Company's cautionary statement
regarding forward-looking information included below under
"Forward-Looking Information".
Income
Net income for the 13 weeks ended April 29, 2006 was $61.3 million
($0.77 per diluted share) compared to net income of $38.0 million
($0.46 per diluted share) for the 13 weeks ended April 30, 2005.
Highlights
Dillard's remains committed to providing a differentiated shopping
experience to position its merchandise mix toward a more upscale and
contemporary tone to continue to attract customers who are seeking
exciting statements in fashion. Resulting successes in the first
quarter include:
-- Same store sales increased 2% for the 13 weeks ended April 29,
2006 compared to the 13 weeks ended April 30, 2005.
-- Dillard's improved its gross margin performance by 70 basis
points of sales compared to the 13 weeks ended April 30, 2005
as customers responded positively to the Company's
improvements in its merchandise assortment.
Revenues
Net sales for the 13 weeks ended April 29, 2006 were $1.838
billion compared to sales for the 13 weeks ended April 30, 2005 of
$1.803 billion.
During the 13 weeks ended April 29, 2006, net sales were strongest
in the Eastern and Western regions, where performance exceeded the
Company's total trend for the period. Net sales were slightly below
trend in the Central region.
Net sales in accessories/lingerie and furniture significantly
exceeded the Company's average sales trend for the 13 weeks ended
April 29, 2006, while performance in children's apparel was
significantly below trend.
Gross Margin
Dillard's achieved gross margin improvement of 70 basis points of
sales for the 13 weeks ended April 29, 2006 compared to the 13 weeks
ended April 30, 2005. The Company attributes its improved gross margin
performance to positive customer response to its merchandise mix as
evidenced by a comparable store sales increase of 2% and lower levels
of markdowns partially offset by lower markups.
Total inventory as of April 29, 2006 declined 1% compared to April
30, 2005. Inventory in comparable stores declined 2% for the same
period.
Advertising, Selling, Administrative and General Expenses
Advertising, selling, administrative and general ("S G & A")
declined 70 basis points of sales ($2.7 million) for the 13 weeks
ended April 29, 2006. S G & A expenses were $494.6 million and $497.3
million for the 13 weeks ended April 29, 2006 and April 30, 2005,
respectively.
Financial Accounting Standards Board No. 123R was effective for
the Company beginning in fiscal year 2006 and required the recording
of the fair value of stock based compensation. Total stock
compensation expense for the 13 weeks ended April 29, 2006 was
$532,000.
Interest and Debt Expense
Interest and debt expense declined $2.6 million to $23.6 million
for the 13 weeks ended April 29, 2006 compared to the 13 weeks ended
April 30, 2005 as a result of lower debt levels.
As of April 29, 2006, letters of credit totaling $71.4 million
were outstanding under the Company's $1.2 billion revolving credit
facility.
Share Repurchase Program
During the 13 weeks ended April 29, 2006, Dillard's repurchased
$3.3 million of Class A Common Stock under its $200 million share
repurchase program approved by the board of directors in May of 2005.
As of April 29, 2006, authorization of $111.9 million remained under
the share repurchase program. As of April 29, 2006, 79.2 million
shares of Dillard's, Inc. Class A and Class B Common Stock were
outstanding.
Store Information
Four stores in the Gulf Coast area which were damaged by Hurricane
Katrina and Hurricane Rita remained closed as of April 29, 2006.
Dillard's opened three new locations during the first quarter of 2006:
Center City Square Feet Month
- ----------------------------------------------------------------------
Southaven Towne Center Southaven, MS 155,000 March
The Summit Sierra Reno, NV 200,000 March
The Mall at Turtle Creek (1) Jonesboro, AR 155,000 March
(1) Replacement store.
During the 13 weeks ended April 29, 2006, Dillard's closed
locations in Southglenn Mall in Denver, Colorado (165,000 square feet)
and Heritage Park Mall in Midwest City, Oklahoma (100,000 square
feet).
As of April 29, 2006, the Company operated 327 Dillard's locations
spanning 29 states, net of the four locations closed at the time due
to hurricane damage.
Dillard's, Inc. and Subsidiaries
Condensed Consolidated Statements of Income
(In Millions, Except Per Share Data)
13-Week Period Ended
----------------------------------------
April 29, 2006 April 30, 2005
----------------------------------------
% of Net % of Net
Amount Sales Amount Sales
------------ ------- ----------- -------
Net sales $ 1.837.5 - $ 1,803.0 -
Total revenues 1,879.0 102.3 % 1,838.7 102.0 %
Cost of sales 1,179.4 64.2 1,170.3 64.9
Advertising, selling,
administrative and general
expenses 494.6 26.9 497.3 27.6
Depreciation and amortization 73.4 4.0 74.6 4.1
Rentals 11.6 0.6 10.5 0.6
Interest and debt expense 23.6 1.3 26.2 1.5
Asset impairment and store
closing charges 0.0 0.0 0.4 0.0
------------ -----------
Total costs and expenses 1,782.6 1,779.3
------------ -----------
Income before income taxes 96.4 5.2 59.4 3.3
Income taxes 35.1 21.4
------------ ------- ----------- -------
Net Income $ 61.3 3.3 % $ 38.0 2.1 %
============ ======= =========== =======
Basic and diluted earnings per
share $ 0.77 $ 0.46
============ ===========
Basic weighted average shares 79.3 83.2
============ ===========
Diluted weighted average shares 79.4 83.5
============ ===========
Dillard's, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In Millions)
April 29, April 30,
2006 2005
---------- ---------
Assets
Current Assets:
Cash and cash equivalents $ 301.7 $ 455.5
Trade accounts receivable 11.5 9.0
Merchandise inventories 2,053.0 2,073.8
Other current assets 35.9 40.6
---------- ---------
Total current assets 2,402.1 2,578.9
Property and equipment, net 3,152.0 3,202.7
Goodwill 34.5 35.5
Other assets 175.1 184.6
---------- ---------
Total Assets $ 5,763.7 $ 6,001.7
========== =========
Liabilities and Stockholders' Equity
Current Liabilities:
Trade accounts payable and accrued expenses $ 1,064.8 $ 1,156.6
Current portion of long-term debt and capital
leases 204.1 96.3
Federal and state income taxes including current
deferred taxes 71.4 93.9
---------- ---------
Total current liabilities 1,340.3 1,346.8
Long-term debt and capital leases 1,089.4 1,326.3
Other liabilities 262.8 270.3
Deferred income taxes 473.2 498.0
Guaranteed preferred beneficial interests in the
Company's subordinated debentures 200.0 200.0
Stockholders' equity 2,398.0 2,360.3
---------- ---------
Total Liabilities and Stockholders' Equity $ 5,763.7 $ 6,001.7
========== =========
Other Information
(In Millions)
April 29, April 30,
2006 2005
---------- ---------
Square footage 56.8 56.1
========== =========
Capital expenditures
13 weeks ended $ 64.7 $ 101.5
Estimates for 2006
The Company is updating the following estimates for certain income
statement items for the fiscal year ending February 3, 2007 based upon
current conditions. Actual results may differ significantly from these
estimates as conditions and factors change -- See "Forward-Looking
Information".
In Millions
-----------
2006 2005
Estimated Actual
----------- --------
Depreciation and amortization $300 $302
Rental expense 57 48
Interest and debt expense 99 106
Capital expenditures
(net of asset trade in) 340 367
Forward-Looking Information
The foregoing contains certain "forward-looking statements" within
the definition of federal securities laws. Statements made in this
release regarding the Company's execution of merchandise initiatives
and estimates for 2006 are forward-looking statements. The Company
cautions that forward-looking statements, as such term is defined in
the Private Securities Litigation Reform Act of 1995, contained in
this report are based on estimates, projections, beliefs and
assumptions of management at the time of such statements and are not
guarantees of future performance. The Company disclaims any obligation
to update or revise any forward-looking statements based on the
occurrence of future events, the receipt of new information, or
otherwise. Forward-looking statements of the Company involve risks and
uncertainties and are subject to change based on various important
factors. Actual future performance, outcomes and results may differ
materially from those expressed in forward-looking statements made by
the Company and its management as a result of a number of risks,
uncertainties and assumptions. Representative examples of those
factors (without limitation) include general retail industry
conditions and macro-economic conditions; economic and weather
conditions for regions in which the Company's stores are located and
the effect of these factors on the buying patterns of the Company's
customers; the impact of competitive pressures in the department store
industry and other retail channels including specialty, off-price,
discount, internet, and mail-order retailers; changes in consumer
spending patterns and debt levels; adequate and stable availability of
materials and production facilities from which the Company sources its
merchandise; changes in operating expenses, including employee wages,
commission structures and related benefits; possible future
acquisitions of store properties from other department store operators
and the continued availability of financing in amounts and at the
terms necessary to support the Company's future business; potential
disruption from terrorist activity and the effect on ongoing consumer
confidence; potential disruption of international trade and supply
chain efficiencies; events causing disruption or delays in the store
construction schedule, world conflict and the possible impact on
consumer spending patterns and other economic and demographic changes
of similar or dissimilar nature.
CONTACT: Dillard's, Inc.
Julie J. Bull, 501-376-5965