Cato reports Q2 net loss of 0.03 dollar per share

The Cato Corporation reported a net loss of 0.9 million dollars or a loss of 0.03 dollar per diluted share for the second quarter ended July 29, 2017, compared to net income of 15.9 million dollars or 0.57 dollar per diluted share for the second quarter, last year. Sales were 205 million dollars or a decrease of 13 percent from sales of 236.7 million dollars in the same quarter last year. The company's same-store sales for the quarter decreased 14 percent to last year.

"Negative sales trends continue to put severe pressure on merchandise margins and profitability as we continue to work through our merchandise missteps," stated John Cato, Chairman, President, and CEO in a statement, adding, "It is taking longer to work through these issues than expected and we expect full year earnings to be significantly below last year."

Gross margin decreased 590 basis points to 31.1 percent as a percent of sales primarily due to lower merchandise margins. During the second quarter, the company opened two stores and relocated one store and now expects to open six new stores during 2017, down from our last estimate of 13 stores. As of July 29, 2017, the Cato Corporation operated 1,374 stores in 33 states, compared to 1,373 stores in 33 states as of July 30, 2016.

Picture:Cato Fashion website