Dillard’s Inc. reported net income for the 52 weeks ended January 28, 2017 of $169.2 million, or $4.93 per share, compared to net income of $269.4 million, or $6.91 per share, for the prior-year 52-week period. Included in net income for the 52-week period ended January 28, 2017 is an after-tax asset impairment of $4.2 million (12 cents per share) on a cost method investment.

Included in net income for the prior-year 52-week period ended January 30, 2016 is a net after-tax credit of $8.1 million (21 cents per share) related to the sale of four store locations.

Net sales for the 52 weeks ended January 28, 2017 were $6.257 billion and $6.596 billion for the 52 weeks ended January 30, 2016. Total merchandise sales for the 52-week period ended January 28, 2017 were $6.071 billion and $6.389 billion for the 52-week period ended January 30, 2016. Net sales include the operations of the company’s construction business, CDI Contractors LLC. Total merchandise sales (which exclude CDI) decreased 5 percent for the 52-week period ended January 28, 2017. Sales in comparable stores for the period also decreased 5 percent.

During the year, the company purchased $246.2 million of Class A Common Stock under its share repurchase authorization. Share repurchases were accomplished entirely from available cash and operating cash flow.

Fourth Quarter Results
Dillard’s reported net income for the 13 weeks ended January 28, 2017 of $56.9 million, or $1.72 per share, compared to net income of $84 million, or $2.31 per share, for the prior-year fourth quarter. Included in net income for the 13-week period ended January 28, 2017 is an after-tax asset impairment of $4.2 million (13 cents per share) on a cost method investment.

Included in net income for the prior-year fourth quarter ended January 30, 2016 is an after-tax gain of $2 million (6 cents per share) related to the sale of a store location.

Dillard Chief Executive Officer William T. Dillard II stated, “Our operating results reflect another quarter of mall traffic declines from continued retail industry challenges. In response, we are ramping up our efforts to bring more distinctive brand and service experiences to Dillard’s, both in-store and online. Our strong balance sheet provides us support in these challenging times, and during the year we returned $256 million to shareholders.”

Net sales for the 13 weeks ended January 28, 2017 were $1.936 billion and $2.074 billion for the 13 weeks ended January 30, 2016.

Total merchandise sales (which exclude CDI) for the 13-week period ended January 28, 2017 were $1.896 billion and $2.021 billion for the 13-week period ended January 30, 2016. Total merchandise sales decreased 6 percent for the 13-week period ended January 28, 2017. Sales in comparable stores for the period also decreased 6 percent. Although all sales categories declined during the quarter, better performing categories relative to the total trend were ladies’ apparel and men’s apparel and accessories. Weakest performing categories were home and furniture and shoes. Sales were strongest in the Eastern region followed by the Western and Central regions, respectively.

During the quarter, the Company purchased $80.6 million of Class A Common Stock under its share repurchase authorization.

Gross Margin/Inventory
Gross margin from retail operations (which excludes CDI) improved 8 basis points of sales for the 13 weeks ended January 28, 2017 compared to the prior-year fourth quarter. Inventory increased 2 percent at January 28, 2017 compared to January 30, 2016. Consolidated gross margin for the 13 weeks ended January 28, 2017 improved 24 basis points of sales compared to the prior-year fourth quarter.

Gross margin from retail operations declined 73 basis points of sales for the 52 weeks ended January 28, 2017 compared to the prior 52 weeks ended January 30, 2016. Consolidated gross margin for the 52 weeks ended January 28, 2017 declined 62 basis points of sales compared to the prior 52 weeks ended January 30, 2016.

Selling, General & Administrative Expenses
Selling, general and administrative expenses (operating expenses) were $451.6 million (23.3 percent of sales) and $449.4 million (21.7 percent of sales) during the 13 weeks ended January 28, 2017 and January 30, 2016, respectively. Increased selling payroll and services purchased expense was partially offset by savings in several expense categories.

Operating expenses declined $14.3 million to $1.656 billion (26.5 percent of sales) from $1.67 billion (25.3 percent of sales) during the 52 weeks ended January 28, 2017 compared to January 30, 2016. During the fiscal year, savings in several expense categories, notably advertising, utilities and supplies, were partially offset by increased payroll and employee-related insurance expense.

Share Repurchase
During the 13 weeks ended January 28, 2017, the company purchased $80.6 million (1.3 million shares) of Class A Common Stock under its $500 million share repurchase program. During the 52 weeks ended January 28, 2017, the company purchased $246.2 million (3.8 million shares) of Class A Common Stock. Total shares outstanding (Class A and Class B Common Stock) at January 28, 2017 and January 30, 2016 were 32.2 million and 35.9 million, respectively. At January 28, 2017, authorization of $253.8 million remained under the plan.

Store Information
At January 28, 2017, the company operated 268 Dillard’s locations and 25 clearance centers spanning 29 states and an internet store at dillards.com. Total square footage at January 28, 2017 was 49.2 million.