Cato Reports 2019 Increases in Income and Earnings at Annual Meeting
CHARLOTTE, N.C., May 22, 2020 /PRNewswire/ -- The Cato Corporation (NYSE: CATO) held its Annual Shareholders' Meeting yesterday, reporting increases in net income and earnings per diluted share for 2019.
Cato's net income in 2019 was $35.9 million – up 18 percent from 2018, which was up 257 percent from 2017. Earnings per share totaled $1.46 – a 19 percent increase from 2018, which was a 262 percent increase from 2017. The company ended 2019 with more than $212 million in unrestricted cash and investments, and it remained debt-free throughout 2019.
"We are encouraged that even during a major transformation in retail, we grew our business in 2019 after stabilizing it in 2018," said John Cato, Chairman, President, and CEO. "We continue to focus on our product and merchandise assortments so that as consumers dramatically change how, when and what they shop for, we offer fashions at great values that resonate with our customers."
In 2019, Cato returned more than $42 million to shareholders through dividends and share repurchases, maintaining a quarterly dividend of 33 cents per share.
Cato's success stems from the hard work and dedication of its associates and the loyalty of its customers, Mr. Cato said. He shared updates on three key initiatives:
- A new store development strategy designed to take advantage of women's retail apparel space vacancies in the market;
- Offering more exclusive products by building on the success of the internal design organization, and;
- Strengthening the company's overseas sourcing offices to improve merchandise quality and accelerate product development
During the annual meeting at Cato's corporate offices in Charlotte, N.C., shareholders re-elected three board members – Dr. Pamela Davies, Thomas B. Henson and Bryan F. Kennedy, III – each for a three-year term that expires in 2023.
Shareholders also received updates on 2020 progress:
- Our stores were temporarily closed March 19 for the safety of our customers and associates, beginning to reopen May 1 in compliance with local health and safety guidelines. The pandemic's dramatic impact on our customers and our communities has significantly dropped Cato's sales during 1Q 2020.
- Our associates have demonstrated amazing strength and dedication, working tirelessly over the past several weeks as we took actions to reduce expenses across the organization to protect the company's long-term health.
- The company has taken additional steps to preserve capital resources by suspending the quarterly dividend and reducing capital expenditures.
- The coronavirus pandemic limited new store development for 2020 to only previously leased locations. To date, 28 new stores have opened and the remaining stores will open by the end of 3Q.
"We have yet to realize the full impact of the pandemic on the retail industry, consumers and the economy," Mr. Cato said. "Given the extraordinary circumstances we face, we must continue to operate with great care and discipline, taking difficult steps to safeguard the long-term health of our company."
The Cato Corporation is a leading specialty retailer of value-priced fashion apparel and accessories operating three concepts, "Cato", "Versona" and "It's Fashion". The Company's Cato stores offer exclusive merchandise with fashion and quality comparable to mall specialty stores at low prices every day. The Company also offers exclusive merchandise found in its Cato stores at www.catofashions.com. Versona is a unique fashion destination offering apparel and accessories including jewelry, handbags and shoes at exceptional prices every day. Select Versona merchandise can also be found at www.shopversona.com. It's Fashion offers fashion with a focus on the latest trendy styles for the entire family at low prices every day.
Statements in this press release not historical in nature including, without limitation, statements regarding the Company's expected or estimated operational and financial results and potential impact of the coronavirus are considered "forward-looking" within the meaning of The Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on current expectations that are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those contemplated by the forward-looking statements. Such factors include, but are not limited to, any actual or perceived deterioration in the conditions that drive consumer confidence and spending, including, but not limited to, prevailing social, economic, political and public health conditions and uncertainties, levels of unemployment, fuel, energy and food costs, wage rates, tax rates, interest rates, home values, consumer net worth and the availability of credit; changes in laws or regulations affecting our business including tariffs; uncertainties regarding the impact of any governmental responses to the foregoing conditions; competitive factors and pricing pressures; our ability to predict and respond to rapidly changing fashion trends and consumer demands; our ability to successfully open new stores as planned and our ability of any such new stores to grow and perform as expected; adverse weather, public health threats (including the global coronavirus (COVID-19) outbreak) or similar conditions that may affect our sales or operations; inventory risks due to shifts in market demand, including the ability to liquidate excess inventory at anticipated margins; and other factors discussed under "Risk Factors" in Part I, Item 1A of the Company's most recently filed annual report on Form 10-K and in other reports the Company files with or furnishes to the SEC from time to time. The Company does not undertake to publicly update or revise the forward-looking statements even if experience or future changes make it clear that the projected results expressed or implied therein will not be realized. The Company is not responsible for any changes made to this press release by wire or Internet services.
SOURCE The Cato Corporation