Dillard's Swings to First-Quarter Loss and Sales Slide - Stores Start to Reopen

Dillard's swung to a first-quarter loss as sales dropped to about half the year-earlier level. The retailer is reopening some stores.
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Dillard's  (DDS) - Get Report swung to a first-quarter loss as sales plummeted nearly 50% due to the coronavirus shutdown, but the department-store operator has begun to reopen some stores.

Shares of the Little Rock, Ark., company at last check were up 5.9% to $24.43.

The company reported a net loss of $162 million, or $6.94 a share, compared with net income of $78.6 million, or $2.99, in the year-earlier period. Net sales tumbled 46% to $786.7 million from $1.46 billion.

Analysts surveyed by FactSet were calling for a loss of $7.16 a share and revenue of $822 million.

The company had closed all 285 store locations by April 9. Dillard's reopened 45 stores on May 5 and an additional 80 on May 12. The stores are operating with reduced hours.

Dillards has reopened 149 locations to date, including 24 clearance centers and is planning to reopen 116 Dillard's stores and 5 clearance centers next week for a total of 241 Dillard's stores and 29 clearance centers open.

Based on nine days of data, the company said, the 45 stores that opened on May 5 have produced about 56% of the sales from a year earlier while operating at reduced hours.

"COVID-19 has impacted every aspect of our business," Chief Executive William T. Dillard II said in a statement. 

"The mall business in general and department stores, specifically, have been particularly hard hit. While our balance sheet was already strong, we took decisive, sometimes difficult, actions to preserve liquidity and ensure our long-term viability."

Roughly 90% of Dillard's 38,000 associates were furloughed at the peak of the store closures and about 65% remain on furlough. The company imposed a 20% salary reduction for all salaried associates on April 17. 

"As we reopen stores, we see positive things happening," Dillard said. "We believe people are ready to get out and shop. We are hoping this is the start of better times."