UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 29549
Form 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 17, 2005
THE CATO CORPORATION
| Delaware | 1-31340 | 56-0484485 | ||
| (State or Other Jurisdiction | (Commission | (I.R.S. Employer | ||
| of Incorporation) | File Number) | Identification Number) |
| 8100 Denmark Road, Charlotte, North Carolina | 28273-5975 | |
| (Address of Principal Executive Offices) | (Zip Code) |
(704) 554-8510
Not Applicable
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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THE CATO CORPORATION
Item 2.02. Results of Operations and Financial Condition.
On May 17, 2005, The Cato Corporation issued a press release regarding its financial results for the first quarter ending April 30, 2005. A copy of this press release is attached hereto as Exhibit 99.1 and incorporated by reference herein.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits
Exhibit 99.1 – Press Released issued May 17, 2005
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| THE CATO CORPORATION | ||
May 19, 2005
|
/s/ John P. Derham Cato | |
Date
|
John P. Derham Cato Chairman, President and Chief Executive Officer |
|
May 19, 2005
|
/s/ Michael O. Moore | |
Date
|
Michael O. Moore Executive Vice President Chief Financial Officer and Secretary |
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Exhibit Index
| Exhibit | Exhibit No. | |||
Press Release issued May 17, 2005
|
99.1 | |||
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Exhibit 99.1
The CATO Corporation
NEWS RELEASE
FOR IMMEDIATE RELEASE
CEO Approval ________
For Further Information Contact:
Michael O. Moore
Executive Vice President
Chief Financial Officer
704-551-7201
CATO REPORTS 1Q EPS UP 7%
EXCEEDS PREVIOUS ESTIMATE
Provides 2Q Guidance
Charlotte, NC (May 17, 2005) – The Cato Corporation (NYSE: CTR) today reported net income of $18.4 million or $.87 per diluted share for the first quarter ended April 30, 2005, compared to net income of $16.8 million or $.81 per diluted share for the first quarter ended May 1, 2004. Net income increased 10% and earnings per diluted share increased 7% from first quarter 2004. Sales for the first quarter were $215.1 million, a 5% increase over sales of $205.2 million for the first quarter last year. The Company’s first quarter comparable store sales were flat to last year.
“Our first quarter results exceeded our estimated EPS range of $.83 to $.86,” said John Cato, Chairman, President, and Chief Executive Officer. “Gross margin was better than plan and last year due to tight inventory management. We expect second quarter earnings per diluted share to be in the range of $.40 to $.42 versus $.39 last year. For the year, we are estimating earnings per diluted share to be in the range of $1.73 to $1.81 versus $1.66 last year. Comparable store sales are estimated to be in the range of flat to up 2% for the second quarter and balance of the year. For the year, our plan of delivering a 10% increase in net income and a 9% increase in EPS, or $1.81 per diluted share, remains unchanged.”
During the first quarter, the Company opened 17 stores, relocated five stores, and closed six stores. As of April 30, 2005, the Company operated 1,188 stores in 31 states, compared to
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8100 Denmark Road
P. O. Box 34216
Charlotte, NC 28234
(704) 554-8510
1,118 stores in 28 states as of May 1, 2004.
The Cato Corporation is a leading specialty retailer of value-priced women’s fashion apparel operating two divisions, “Cato” and “It’s Fashion!”. The Company offers exclusive merchandise with fashion and quality comparable to mall specialty stores at low prices, every day. Additional information on The Cato Corporation is available at www.catocorp.com.
Statements in this press release not historical in nature including, without limitation, statements regarding the Company’s expected financial results for the second quarter and year 2005 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, the following: general economic conditions; competitive factors and pricing pressures; the Company’s ability to predict fashion trends; consumer apparel buying patterns; adverse weather conditions and inventory risks due to shifts in market demand. 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.
# # #
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8100 Denmark Road
P. O. Box 34216
Charlotte, NC 28234
(704) 554-8510
THE CATO CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
FOR THE PERIODS ENDED APRIL 30, 2005 AND MAY 1, 2004
(Dollars in thousands, except per share data)
| Quarter Ended | ||||||||||||||||
| April 30, | % | May 1, | % | |||||||||||||
| 2005 | Sales | 2004 | Sales | |||||||||||||
| (Restated) | ||||||||||||||||
REVENUES |
||||||||||||||||
Retail sales |
$ | 215,064 | 100.0 | % | $ | 205,193 | 100.0 | % | ||||||||
Other income (principally finance,
late fees and layaway charges) |
3,863 | 1.8 | % | 4,008 | 2.0 | % | ||||||||||
Total revenues |
218,927 | 101.8 | % | 209,201 | 102.0 | % | ||||||||||
GROSS MARGIN (Memo) |
78,630 | 36.6 | % | 72,795 | 35.5 | % | ||||||||||
COSTS AND EXPENSES, NET |
||||||||||||||||
Cost of goods sold |
136,434 | 63.4 | % | 132,398 | 64.5 | % | ||||||||||
Selling, general and administrative |
49,333 | 22.9 | % | 45,796 | 22.3 | % | ||||||||||
Depreciation |
5,038 | 2.3 | % | 4,979 | 2.4 | % | ||||||||||
Interest expense |
152 | 0.1 | % | 162 | 0.1 | % | ||||||||||
Interest and other income |
(941 | ) | -0.4 | % | (506 | ) | -0.2 | % | ||||||||
Cost and expenses, net |
190,016 | 88.3 | % | 182,829 | 89.1 | % | ||||||||||
Income Before Income Taxes |
28,911 | 13.5 | % | 26,372 | 12.9 | % | ||||||||||
Income Tax Expense |
10,495 | 4.9 | % | 9,573 | 4.7 | % | ||||||||||
Net Income |
$ | 18,416 | 8.6 | % | $ | 16,799 | 8.2 | % | ||||||||
Basic Earnings Per Share |
$ | 0.89 | $ | 0.82 | ||||||||||||
Basic Weighted Average Shares |
20,736,217 | 20,499,605 | ||||||||||||||
Diluted Earnings Per Share |
$ | 0.87 | $ | 0.81 | ||||||||||||
Diluted Weighted Average Shares |
21,195,426 | 20,845,867 | ||||||||||||||
THE CATO CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
| April 30, | May 1, | January 29, | ||||||||||
| 2005 | 2004 | 2005 | ||||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| (Restated) | ||||||||||||
ASSETS |
||||||||||||
Current Assets |
||||||||||||
Cash and cash equivalents |
$ | 22,773 | $ | 23,167 | $ | 18,640 | ||||||
Short-term investments |
71,472 | 67,155 | 88,588 | |||||||||
Accounts receivable — net |
49,534 | 51,427 | 50,889 | |||||||||
Merchandise inventories |
105,084 | 99,855 | 100,538 | |||||||||
Other current assets |
12,112 | 11,190 | 7,767 | |||||||||
Total Current Assets |
260,975 | 252,794 | 266,422 | |||||||||
Property and Equipment — net |
118,727 | 116,400 | 117,590 | |||||||||
Other Assets |
10,391 | 10,189 | 10,122 | |||||||||
TOTAL |
$ | 390,093 | $ | 379,383 | $ | 394,134 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||||||
Current Liabilities |
$ | 128,771 | $ | 124,586 | $ | 132,631 | ||||||
Noncurrent Liabilities |
34,268 | 34,372 | 34,328 | |||||||||
Long Term Debt |
0 | 20,000 | 16,000 | |||||||||
Stockholders’ Equity |
227,054 | 200,425 | 211,175 | |||||||||
| |
||||||||||||
TOTAL |
$ | 390,093 | $ | 379,383 | $ | 394,134 | ||||||
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