Cato Reports 4% Increase in July Comps, Provides Q2 Outlook
Last week, Charlotte, NC-based retailer of apparel and accessories for women, Cato Corporation (CATO) posted yet another month of improved comparable-store sales (comps) performance for the 4 weeks ended Aug 2, 2014. Comps for the period registered growth of 4%.
Further, for the 4-week period, Cato reported a year-over-year increase of 6% in total sales, which came in at $65.3 million versus sales of $61.6 million registered for the 4-week period ended Aug 3, 2013. The company’s key retail metrics came in line with the year-to-date trend.
Cato is not the only retailer which has registered a rise in its sales performance last month. Other retailers such as Zumiez Inc. (ZUMZ), Costco Wholesale Corp. (COST) and L Brands, Inc. (LB) have also witnessed increases of 3.5%, 5% and 6%, respectively, in July comps. The improvement in July results was mostly attributed to a rise in traffic probably due to the positive economic factors like a better job scenario and consumer credit as well as heavy promotions.
Now coming back to Cato, sales for the second quarter of fiscal 2014, ended on Aug 2, came in at $243.8 million, up 6% from $229.4 million of sales generated during the second quarter of the previous fiscal ended Aug 3, 2013. Comps for the second quarter witnessed growth of 3%.
For the year-to-date period, Cato’s sales increased 6% year over year to $526.2 million compared with $496.6 million in the year-ago period. Comps for the period were 3% higher than the year-ago period.
Further, the company also provided earnings outlook for the second quarter wherein it expects earnings to come in the range of 50 cents to 53 cents per share compared with 51 cents reported in the year-ago comparable quarter. Currently, the Zacks Consensus Estimate for the quarter is pegged at 51 cents per share.
Cato operated 1,328 stores across 32 states as of Aug 2, 2014 compared with 1,306 stores across 31 states as of Aug 3, 2013.
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