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'We will continue to maintain conservative fiscal posture' - Dillard's CEO
19 May '09
5 min read
Advertising, Selling, Administrative and General Expenses
Advertising, selling, administrative and general ("operating expenses") expenses declined $66.6 million during the thirteen weeks ended May 2, 2009 primarily as a result of the Company's extensive expense reduction measures combined with recent store closures. Notable areas of savings during the first quarter of 2009 were payroll, services purchased, supplies and advertising. Management believes recent expense reduction initiatives combined with savings from store closures could produce an operating expense decline of as much as $200 million during the 2009 fiscal year.
Interest and Debt Expense/Note Repurchase
Net interest and debt expense declined $3.7 million for the thirteen weeks ended May 2, 2009 compared to the thirteen weeks ended May 3, 2008. During the thirteen weeks ended May 2, 2009, Dillard's repurchased $5.0 million face amount of 9.125% notes maturing on August 1, 2011. As a result, a pretax gain of approximately $1.5 million ($0.9 million after tax or $0.01 per share) is included in interest and debt expense for the first quarter of 2009. Interest and debt expense was $18.4 million and $22.1 million during the thirteen weeks ended May 2, 2009 and May 3, 2008, respectively.
Credit Facility
Dillard's maintains a $1.2 billion revolving credit facility with JPMorgan Chase Bank as the lead agent. The credit agreement expires on December 12, 2012, and there are no financial covenants under this facility provided its availability exceeds $100 million. As of May 2, 2009, short-term borrowings of $175 million and letters of credit totaling $91.3 million were outstanding under the revolving credit facility.
CDI Contractors LLC
Operating results for the thirteen weeks ended May 2, 2009 reflect the operations of CDI Contractors, LLC ("CDI"), a former equity method joint venture investment. The Company purchased the remaining 50% interest of CDI on August 29, 2008. The increase in accounts receivable from $9.0 million at May 3, 2008 to $70.4 million at May 2, 2009 is primarily due to the consolidation of CDI.
Store Information
During the thirteen weeks ended May 2, 2009 Dillard's announced the upcoming closure of its Tullahoma, Tennessee location. The store is expected to close during the second quarter of 2009. Currently, Dillard's has identified four other locations for closure during 2009 and remains committed to closing under-performing stores where appropriate.
Advertising, selling, administrative and general ("operating expenses") expenses declined $66.6 million during the thirteen weeks ended May 2, 2009 primarily as a result of the Company's extensive expense reduction measures combined with recent store closures. Notable areas of savings during the first quarter of 2009 were payroll, services purchased, supplies and advertising. Management believes recent expense reduction initiatives combined with savings from store closures could produce an operating expense decline of as much as $200 million during the 2009 fiscal year.
Interest and Debt Expense/Note Repurchase
Net interest and debt expense declined $3.7 million for the thirteen weeks ended May 2, 2009 compared to the thirteen weeks ended May 3, 2008. During the thirteen weeks ended May 2, 2009, Dillard's repurchased $5.0 million face amount of 9.125% notes maturing on August 1, 2011. As a result, a pretax gain of approximately $1.5 million ($0.9 million after tax or $0.01 per share) is included in interest and debt expense for the first quarter of 2009. Interest and debt expense was $18.4 million and $22.1 million during the thirteen weeks ended May 2, 2009 and May 3, 2008, respectively.
Credit Facility
Dillard's maintains a $1.2 billion revolving credit facility with JPMorgan Chase Bank as the lead agent. The credit agreement expires on December 12, 2012, and there are no financial covenants under this facility provided its availability exceeds $100 million. As of May 2, 2009, short-term borrowings of $175 million and letters of credit totaling $91.3 million were outstanding under the revolving credit facility.
CDI Contractors LLC
Operating results for the thirteen weeks ended May 2, 2009 reflect the operations of CDI Contractors, LLC ("CDI"), a former equity method joint venture investment. The Company purchased the remaining 50% interest of CDI on August 29, 2008. The increase in accounts receivable from $9.0 million at May 3, 2008 to $70.4 million at May 2, 2009 is primarily due to the consolidation of CDI.
Store Information
During the thirteen weeks ended May 2, 2009 Dillard's announced the upcoming closure of its Tullahoma, Tennessee location. The store is expected to close during the second quarter of 2009. Currently, Dillard's has identified four other locations for closure during 2009 and remains committed to closing under-performing stores where appropriate.
Dillard's Inc
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