U.S. Markets closed

Cato January key revenue figure falls 12 percent

The Associated Press

Cato Corp. cut its profit forecast again Thursday after a key revenue figure dropped 12 percent in January.

The company's fiscal year ended Feb. 2. Cato, which runs about 1,300 stores in the U.S., will report full results for the period on March 21.

Sales worsened throughout the month, which the company attributed to delays in shoppers' tax refunds and the hit to their income from higher Social Security payroll taxes that went into effect this year.

Revenue at stores open at least a year is an important gauge of a retailer's health because it excludes results from stores recently opened or closed.

For the five weeks ended Feb. 2, total revenue rose 26 percent to $63.8 million. The company got a boost because of an extra week of sales this fiscal January compared with 2012. On an adjusted basis, five-week revenue dropped 9 percent.

Fourth-quarter revenue at stores open at least a year fell 7 percent. Total revenue rose 5 percent to $232 million.

Cato said it now expects fourth-quarter earnings of 27 cents to 29 cents per share, down from 35 cents per share in the same period last year. This is the second time it's cut its guidance. In January the company lowered its outlook to 34 cents to 36 cents per share from 38 cents to 42 cents per share.