Home / Knowledge / News / Apparel/Garments / Cato delivers record earnings in 2010
Cato delivers record earnings in 2010
21
Mar '11
The Cato Corporation reported net income for the fourth quarter and year ended January 29, 2011. For the fourth quarter, the Company reported net income of $7.9 million or $0.27 per diluted share, compared to net income of $7.3 million or $0.25 per diluted share for the fourth quarter ended January 30, 2010.

For the quarter, both net income and earnings per diluted share increased 8% over the prior year. Full year 2010 net income was a record $57.7 million or $1.96 per diluted share compared to $45.8 million or $1.55 per diluted share for 2009. For the year, both net income and earnings per diluted share increased 26% over the prior year.

Sales for fiscal fourth quarter ended January 29, 2011 were $224.3 million, a 3% increase over sales of $217.7 million for the fourth quarter ended January 30, 2010. For the quarter, same-store sales increased 1%. The Company's sales for 2010 were $913.9 million, an increase of 5% over 2009 sales of $872.1 million. For the year, same-store sales increased 3%.

"Cato delivered record earnings in 2010, the Company's third straight year of strong growth, by continuing to offer our customers great fashion and customer service at a great value," said John Cato, Chairman, President and Chief Executive Officer. "Weaker than expected sales over the last half of the fourth quarter created higher than expected markdowns and negatively impacted the quarter's results."

2010 Review

For 2010, gross margin increased 140 basis points to 38.1%of sales due to higher merchandise margin as a result of lower markdowns. Selling, general and administrative expenses decreased to 27.5%of sales primarily due to a reduction in store closing costs and leveraging other costs against higher sales, which offset higher workers' compensation insurance costs. The Company's effective income tax rate increased to 36.4% from 33.6% last year primarily due to higher state taxes. Net income was 6.3% of sales vs. 5.2% last year.

"Cato's balance sheet remains strong with approximately $235 million in cash and short-term investments and no debt," commented Mr. Cato. During 2010, the Company returned $21.2 million in dividends to shareholders. The Company's annualized dividend of $0.74 per share, after a 12% increase in 2010, represents a yield of approximately 3% based on the March 16 closing price of $23.59.

For the fiscal year ended January 29, 2011, the Company opened 37 stores (including opening 14 It's Fashion Metro stores in markets where existing It's Fashion stores were simultaneously closed), relocated four stores and closed 26 stores including the 14 It's Fashion stores mentioned above.

2011 Outlook

The Company believes that 2011 will continue to be impacted by the uncertainty surrounding the country's economic environment including slow job growth and the negative impact of inflation in food and gasoline prices on consumers. Also, the Company expectsrising raw material and freight costs to have a negative effect on the Company's performance in 2011, primarily in the second half of the year.


Must ReadView All

Ghana makes tax stamp compulsory on imported textiles

Textiles | On 27th May 2018

Ghana makes tax stamp compulsory on imported textiles

To curb illegal imports, Ghanaian authorities will put a tax stamp on ...

Courtesy: Vishal Mega Mart

Apparel/Garments | On 27th May 2018

Partners Group, Kedaara Capital taking over VMM

Partners Group, a private markets investment manager, and Kedaara...

Courtesy: Deckers

Apparel/Garments | On 27th May 2018

Deckers Brands sales soar 8.4% in Q4FY18

Deckers Brands, a global leader in designing, marketing and...

Interviews View All

Nitin Soni
Dolphin Jingwei Machines

Taxation policies need to be made simpler

Vidhyaa Shankar. S
A Ganapathi Chettiar

'The usage of knits is getting into the boundaries of woven fabrics'

Krishnanand Tripathi
Textrade International Ltd

We believe in vocational education for entry-level employees, offering...

Akshat Chaudhary

Aizome, Asia's first Fairtrade denim brand, is all set to launch next...

Erik Sy

Manila-based CustomThread is a start-up offering premium custom apparel...

Rikesh Mistry

Jupiter Comtex Pvt Ltd, established in 1973, started its textile machinery ...

Giorgio Mantovani
Corman S.p.A

Giorgio Mantovani, MD of Corman, with a presence in both Milano and New...

Mohammad Hassan
Biax Fiberfilm

About one in every 20 patients picks up an infection while hospitalised....

Ashok Desai
Bombay Textile Research Association

Bombay Textile Research Association (BTRA) is a leading name in textile...

Anisha Chaudhari
Threads & Shirts

Threads & Shirts is a freshly-tailored concept providing men/women a...

Ritu Kumar
Label Ritu Kumar

‘Classics will return’ "There are a lot of people wearing western clothes ...

Yash P. Kotak
Bombay Hemp Company

One of the directors of Bombay Hemp Company, Yash P. Kotak, speaks to...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


May 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Advanced Search