Dillard's, Inc. (NYSE: DDS) is a department store chain in the United States, with 330 stores in 29 states.[2] Headquarted in Little Rock, Arkansas, Dillard's locations are concentrated in Texas and Florida; with a major presence in other states including Arizona, Iowa, Colorado, Wyoming, Kansas, Missouri, Alabama, Georgia, Tennessee, Oklahoma, Mississippi, Louisiana, Nebraska, New Mexico, Nevada, Utah, North Carolina, Virginia, Idaho, South Carolina, Kentucky, Indiana, Ohio, and Illinois. Dillard's also maintains a minor footprint in California, and Montana.
Dillard's carries brands such as Chanel, Clinique, DKNY, Dior, Dolce & Gabbana, Jones New York, Levi's, and Ralph Lauren.
Dillard's, Inc. (Dillard's), incorporated in 1964, is engaged in apparel and home furnishing retail business. As of January 30, 2010, the Company operated 309 Dillard's stores, including 12 clearance centers and one Internet store offering a selection of merchandise, including fashion apparel for women, men and children, accessories, cosmetics, home furnishings and other consumer goods. CDI Contractors, Inc. is a general contractor whose business includes constructing and remodeling stores for the Company. The Company’s stores are located in suburban shopping malls and open-air centers.
The Company’s customers can purchase merchandise online at its Website, which features online gift registries and a variety of other services. The Company operates retail department stores located primarily in the southwest, southeast and midwest regions of the United States. The stores are located in 29 states. The Company’s merchandise selections include Dillard’s lines of brand merchandise, such as Antonio Melani, Gianni Bini, Roundtree & Yorke and Daniel Cremieux. GE Consumer Finance (GE) owns and manages Dillard's credit cards under a long-term marketing and servicing alliance (Alliance).
Dillard's continued its acquisition campaign in 1990, paying BAT Industries $110 million for J.B. Ivey & Company's 23 stores in the Carolinas and Florida. The price of $109 million, or one-third of annual sales, compared favorably with rates others were paying for BAT assets. The purchase also provided Dillard's a base from which to expand in such lucrative markets as Jacksonville and Daytona Beach, Florida, and Raleigh-Durham, North Carolina.
While for many retailers, 1990 was a disastrous year, Dillard's experienced some unique gains. Some estimated that Dillard's enjoyed an 18 percent same-store sales gain over 1989. In 1990, every expense item on the company's income statement dropped as a percentage of sales. Because the company's ratio of debt to capital is lower than that of competitors, interest was less of a problem for Dillard's than for its competition.
By 1992, Dillard's acquisitions program was winding down. In 1991, the company gained eight Maison Blanche Department Stores located in central and western Florida. The following year the company bought four more stores in Ohio from Joseph Horne Co. to add to its Higbee's chain but only after Horne sued Dillard's over its backing out of a deal to acquire Horne in the late 1980s. Horne officials claimed the failed deal ruined the company's finances by disrupting its operations and leading to the departure of key executives. Dillard's received the first significant battering of its clean reputation as a result, but seemed to emerge otherwise unscathed. Also in 1991, Vendamerica sold all of its shares in Dillard's in a public offering.
By 1992, Dillard's had failed to turn around the Higbee's stores in Ohio, but nonetheless increased its exposure by buying out its partner, DeBartolo, for about $90 million. The company also announced that year that it would enter the Mexican market through the development of Dillard's anchors for five planned regional department stores. By mid-1996, the venture had not borne fruit, the apparent victim of the Mexican economic crisis of 1994.
Starting in 1991, the company significantly increased the number of new stores it was opening each year--ten added in 1991 and 11 the following year. Indeed, 1993 saw the beginning of an official shift in the company's growth strategy away from acquisitions and to the opening of new stores. From 1993 to 1995, 26 new stores were opened, while none were added through acquisition. A record 16 new stores were planned for 1996. One advantage of this growth strategy was that Dillard's could carefully choose the locations for its new stores, and it moved into such desirable areas as Louisville, Atlanta, Denver, and Colorado Springs.
By 1993, sales at Dillard's had grown to $5.13 billion, a sixfold increase over a ten-year period, while profits were also multiplying from $34.1 million to $241.1 million. Signs of a downturn, however, were evident even in the 1993 results as sales increased only nine percent, following year after year of growth in the 12 to 19 percent range. Profits, meanwhile, had increased only 2 percent over 1992. This slowdown continued through 1995 as sales increased 8 percent in 1994 and 7 percent in 1995, while profits increased only slightly to $251.8 million in 1994 before falling dramatically to $167 million in 1995, which even without a $78.5 million charge for impairment of long-lived assets would still have totaled only $245.6 million.
Analysts reasoned that Dillard's was in part a victim of weak sales of women's apparel industrywide, which could be devastating for a company that generated about 40 percent of its sales from this sector. However, the company's marketing strategies were also identified as contributing to the difficulties, in particular its longstanding everyday pricing policy; some observers noted that Dillard's lack of promotions caused it to lose customers to other department stores, which lured people through their doors by running sales on an almost constant basis.
Although it was sticking with its marketing policies as of mid-1996, Dillard's reorganized its operating divisions along geographic and climatic lines in March 1996 in order to improve operating results. The company's Cleveland and San Antonio divisions were merged into the company's other divisions, leaving the company with a more streamlined operation with five divisional buying offices.
By the end of the 1990s, however, Dillard's had begun to expand its operations to compete against new competitors in retailing, including giant Wal-Mart. Early in 1998, Dilard's announced plans to purchase rival retailer Mercantile Stores for $2.9 billion, acquiring 103 separate locations in the transaction. Later in the year, Dillard's announced plans to sell off twenty-six of the newly acquired locations--in places as diverse as Duluth, Minnesota and Spartanburg, South Carolina--to avoid competing with itself. The acquisition of Mercantile caused Dillard's expenses to nearly double, cutting deeply into the year's profits. Nevertheless, the addition of the Mercantile stores also boosted sales by more than 25 percent in the third quarter of 1998.
The dip in Dillard's sales following the Mercantile acquisition caused angst for stock market analysts. Early in 1999, following a weak second-quarter report, Wall Street traders reduced their valuation of Dillard's stock. The corporation responded by announcing a plan to repurchase $250 million of its common stock, partly for use in boosting employee retirement plans. Heading into the end of the century, the question facing Dillard's was whether it could turn itself around from the difficult period of the mid-1990s and reestablish its formerly lofty position, which just a few years earlier had it placed at the forefront of the department store industry.
The outlook did not look bright as Dillard's entered the new millennium. By the middle of 2000, the company had posted losses for five consecutive quarters. Business picked up toward the end of the year, however, and by March of 2001 the company reported fourth-quarter net income of $66 million, more than twice what it had been a year before. By the following March, business had increased even further, bringing in net profits of $102 million despite a decline in sales. Dillard's spokespersons credited the early retirement of debt and cost-cutting measures as important steps in the recovery program.
Dillard's sales continued to fall into 2003, driven downward by a difficult economy that hit the business and other full-price retailers hard. Despite adopting new accounting practices, cutting operating expenses by a further 1.9 percent, and tax credits left over from its acquisition of Mercantile, the company continued to lose money and sales. Dillard's responded with a program to slough off six underperforming stores and cutting prices to reduce inventory. Losses continued to mount, however, and at the end of 2003 the Wall Street investor service firm Moody's downgraded Dillard's rating. In 2004, Dillard's also suffered a setback when Hurricane Charley ripped through the southeast, forcing the closing of at least fourteen stores for at least a day.
Despite these setbacks, Dillard's continued to improve performance by cutting operating costs, interest expense, and average gross margin. The company also divested itself of some of its non-core operations. In June 2004, the corporation sold its ticket-sales operation, Dillard's Box Office, to EMT Entertainment Network of California. In September of 2004, Dillard's sold its credit card business to GE Consumer Finance.
From a small department store in Arkansas, the late William Dillard built one of the fastest growing department store chains in the United States. Expanding first by acquisition and later by placing stores in suburban malls and buying underperforming assets from debt-burdened competitors, Dillard's has grown without burdening itself with crushing debt.
Principal Subsidiaries: Cain Sloan, Inc.; Construction Developers Inc.; Dillard Investment Co. Inc.; Dillard Travel, Inc.; D.H. Holmes Company, Limited; J.B. Ivey & Company.
OVERALL
Beta: 2.57
Market Cap (Mil.): $2,606.98
Shares Outstanding (Mil.): 56.12
Annual Dividend: 0.16
Yield (%): 0.34
FINANCIALS
DDS Industry Sector
P/E (TTM): 16.78 12.37 9.11
EPS (TTM): 198.35 -- --
ROI: 4.99 2.70 0.93
ROE: 8.18 4.46 1.62
Statistics:
Public Company
Incorporated: 1964
Employees: 53,598
Sales: $7.59 billion (2004)
Stock Exchanges: New York
Ticker Symbol: DDS
NAIC: 452110 Department Stores
Key Dates:
1938: William Dillard opens a retail store in Nashville, Arkansas, and expands his business through acquisitions.
1964: The company is incorporated.
1968: The company now has stores in Arkansas, Oklahoma, and Texas.
1969: Dillard's goes public on the American Stock Exchange.
1975: The company expands into Kansas.
1984: The company pays the Dayton Hudson Corporation $140 million for 18 John A. Brown stores and 12 Diamond stores in the southwestern United States.
1985: Twelve stores are acquired from the R.H. Macy Company.
1989: New Orleans-based D.H. Holmes Company, a chain of 17 stores located in Louisiana, Mississippi, Alabama, and Florida, is acquired.
1990: The company purchases J.B. Ivey & Company's 23 stores in the Carolinas and Florida.
1993: For a period, the company begins opening new stores rather acquiring existing businesses.
1998: Dillard's purchase of Mercantile Stores for $2.9 billion signals the beginning of financial difficulties for the company.
2003: Dillard's begins selling off operations as part of a strategy to recover lost financial ground.
Name Age Since Current Position
Dillard, William 66 2002 Chairman of the Board, Chief Executive Officer
Dillard, Alex 61 President, Director
Freeman, James 61 Chief Financial Officer, Senior Vice President, Director
Dillard, Mike 59 Executive Vice President, Director
Matheny, Drue 64 Executive Vice President, Director
Schroeder, Paul 63 1998 Vice President, General Counsel
Sanderford, Robin 64 1998 Vice President
Squires, Burt 61 1984 Vice President
Nelson, Steven 53 1988 Vice President
Taylor, Julie 59 1998 Vice President
Terry, David 61 1992 Vice President
Willey, Richard 60 2010 Corporate Vice President - Stores
White, Nick 66 2008 Director
Connor, Robert 69 1987 Independent Director
Watts, J. 53 2009 Independent Director
Stephens, Warren 54 2002 Independent Director
Mori, Frank 70 2008 Independent Director
Martin, R. Brad 60 2008 Independent Director
Hastings, H. Lee 56 2010 Independent Director
Address:
1600 Cantrell Road
Little Rock, Arkansas 72201
U.S.A.
Dillard's carries brands such as Chanel, Clinique, DKNY, Dior, Dolce & Gabbana, Jones New York, Levi's, and Ralph Lauren.
Dillard's, Inc. (Dillard's), incorporated in 1964, is engaged in apparel and home furnishing retail business. As of January 30, 2010, the Company operated 309 Dillard's stores, including 12 clearance centers and one Internet store offering a selection of merchandise, including fashion apparel for women, men and children, accessories, cosmetics, home furnishings and other consumer goods. CDI Contractors, Inc. is a general contractor whose business includes constructing and remodeling stores for the Company. The Company’s stores are located in suburban shopping malls and open-air centers.
The Company’s customers can purchase merchandise online at its Website, which features online gift registries and a variety of other services. The Company operates retail department stores located primarily in the southwest, southeast and midwest regions of the United States. The stores are located in 29 states. The Company’s merchandise selections include Dillard’s lines of brand merchandise, such as Antonio Melani, Gianni Bini, Roundtree & Yorke and Daniel Cremieux. GE Consumer Finance (GE) owns and manages Dillard's credit cards under a long-term marketing and servicing alliance (Alliance).
Dillard's continued its acquisition campaign in 1990, paying BAT Industries $110 million for J.B. Ivey & Company's 23 stores in the Carolinas and Florida. The price of $109 million, or one-third of annual sales, compared favorably with rates others were paying for BAT assets. The purchase also provided Dillard's a base from which to expand in such lucrative markets as Jacksonville and Daytona Beach, Florida, and Raleigh-Durham, North Carolina.
While for many retailers, 1990 was a disastrous year, Dillard's experienced some unique gains. Some estimated that Dillard's enjoyed an 18 percent same-store sales gain over 1989. In 1990, every expense item on the company's income statement dropped as a percentage of sales. Because the company's ratio of debt to capital is lower than that of competitors, interest was less of a problem for Dillard's than for its competition.
By 1992, Dillard's acquisitions program was winding down. In 1991, the company gained eight Maison Blanche Department Stores located in central and western Florida. The following year the company bought four more stores in Ohio from Joseph Horne Co. to add to its Higbee's chain but only after Horne sued Dillard's over its backing out of a deal to acquire Horne in the late 1980s. Horne officials claimed the failed deal ruined the company's finances by disrupting its operations and leading to the departure of key executives. Dillard's received the first significant battering of its clean reputation as a result, but seemed to emerge otherwise unscathed. Also in 1991, Vendamerica sold all of its shares in Dillard's in a public offering.
By 1992, Dillard's had failed to turn around the Higbee's stores in Ohio, but nonetheless increased its exposure by buying out its partner, DeBartolo, for about $90 million. The company also announced that year that it would enter the Mexican market through the development of Dillard's anchors for five planned regional department stores. By mid-1996, the venture had not borne fruit, the apparent victim of the Mexican economic crisis of 1994.
Starting in 1991, the company significantly increased the number of new stores it was opening each year--ten added in 1991 and 11 the following year. Indeed, 1993 saw the beginning of an official shift in the company's growth strategy away from acquisitions and to the opening of new stores. From 1993 to 1995, 26 new stores were opened, while none were added through acquisition. A record 16 new stores were planned for 1996. One advantage of this growth strategy was that Dillard's could carefully choose the locations for its new stores, and it moved into such desirable areas as Louisville, Atlanta, Denver, and Colorado Springs.
By 1993, sales at Dillard's had grown to $5.13 billion, a sixfold increase over a ten-year period, while profits were also multiplying from $34.1 million to $241.1 million. Signs of a downturn, however, were evident even in the 1993 results as sales increased only nine percent, following year after year of growth in the 12 to 19 percent range. Profits, meanwhile, had increased only 2 percent over 1992. This slowdown continued through 1995 as sales increased 8 percent in 1994 and 7 percent in 1995, while profits increased only slightly to $251.8 million in 1994 before falling dramatically to $167 million in 1995, which even without a $78.5 million charge for impairment of long-lived assets would still have totaled only $245.6 million.
Analysts reasoned that Dillard's was in part a victim of weak sales of women's apparel industrywide, which could be devastating for a company that generated about 40 percent of its sales from this sector. However, the company's marketing strategies were also identified as contributing to the difficulties, in particular its longstanding everyday pricing policy; some observers noted that Dillard's lack of promotions caused it to lose customers to other department stores, which lured people through their doors by running sales on an almost constant basis.
Although it was sticking with its marketing policies as of mid-1996, Dillard's reorganized its operating divisions along geographic and climatic lines in March 1996 in order to improve operating results. The company's Cleveland and San Antonio divisions were merged into the company's other divisions, leaving the company with a more streamlined operation with five divisional buying offices.
By the end of the 1990s, however, Dillard's had begun to expand its operations to compete against new competitors in retailing, including giant Wal-Mart. Early in 1998, Dilard's announced plans to purchase rival retailer Mercantile Stores for $2.9 billion, acquiring 103 separate locations in the transaction. Later in the year, Dillard's announced plans to sell off twenty-six of the newly acquired locations--in places as diverse as Duluth, Minnesota and Spartanburg, South Carolina--to avoid competing with itself. The acquisition of Mercantile caused Dillard's expenses to nearly double, cutting deeply into the year's profits. Nevertheless, the addition of the Mercantile stores also boosted sales by more than 25 percent in the third quarter of 1998.
The dip in Dillard's sales following the Mercantile acquisition caused angst for stock market analysts. Early in 1999, following a weak second-quarter report, Wall Street traders reduced their valuation of Dillard's stock. The corporation responded by announcing a plan to repurchase $250 million of its common stock, partly for use in boosting employee retirement plans. Heading into the end of the century, the question facing Dillard's was whether it could turn itself around from the difficult period of the mid-1990s and reestablish its formerly lofty position, which just a few years earlier had it placed at the forefront of the department store industry.
The outlook did not look bright as Dillard's entered the new millennium. By the middle of 2000, the company had posted losses for five consecutive quarters. Business picked up toward the end of the year, however, and by March of 2001 the company reported fourth-quarter net income of $66 million, more than twice what it had been a year before. By the following March, business had increased even further, bringing in net profits of $102 million despite a decline in sales. Dillard's spokespersons credited the early retirement of debt and cost-cutting measures as important steps in the recovery program.
Dillard's sales continued to fall into 2003, driven downward by a difficult economy that hit the business and other full-price retailers hard. Despite adopting new accounting practices, cutting operating expenses by a further 1.9 percent, and tax credits left over from its acquisition of Mercantile, the company continued to lose money and sales. Dillard's responded with a program to slough off six underperforming stores and cutting prices to reduce inventory. Losses continued to mount, however, and at the end of 2003 the Wall Street investor service firm Moody's downgraded Dillard's rating. In 2004, Dillard's also suffered a setback when Hurricane Charley ripped through the southeast, forcing the closing of at least fourteen stores for at least a day.
Despite these setbacks, Dillard's continued to improve performance by cutting operating costs, interest expense, and average gross margin. The company also divested itself of some of its non-core operations. In June 2004, the corporation sold its ticket-sales operation, Dillard's Box Office, to EMT Entertainment Network of California. In September of 2004, Dillard's sold its credit card business to GE Consumer Finance.
From a small department store in Arkansas, the late William Dillard built one of the fastest growing department store chains in the United States. Expanding first by acquisition and later by placing stores in suburban malls and buying underperforming assets from debt-burdened competitors, Dillard's has grown without burdening itself with crushing debt.
Principal Subsidiaries: Cain Sloan, Inc.; Construction Developers Inc.; Dillard Investment Co. Inc.; Dillard Travel, Inc.; D.H. Holmes Company, Limited; J.B. Ivey & Company.
OVERALL
Beta: 2.57
Market Cap (Mil.): $2,606.98
Shares Outstanding (Mil.): 56.12
Annual Dividend: 0.16
Yield (%): 0.34
FINANCIALS
DDS Industry Sector
P/E (TTM): 16.78 12.37 9.11
EPS (TTM): 198.35 -- --
ROI: 4.99 2.70 0.93
ROE: 8.18 4.46 1.62
Statistics:
Public Company
Incorporated: 1964
Employees: 53,598
Sales: $7.59 billion (2004)
Stock Exchanges: New York
Ticker Symbol: DDS
NAIC: 452110 Department Stores
Key Dates:
1938: William Dillard opens a retail store in Nashville, Arkansas, and expands his business through acquisitions.
1964: The company is incorporated.
1968: The company now has stores in Arkansas, Oklahoma, and Texas.
1969: Dillard's goes public on the American Stock Exchange.
1975: The company expands into Kansas.
1984: The company pays the Dayton Hudson Corporation $140 million for 18 John A. Brown stores and 12 Diamond stores in the southwestern United States.
1985: Twelve stores are acquired from the R.H. Macy Company.
1989: New Orleans-based D.H. Holmes Company, a chain of 17 stores located in Louisiana, Mississippi, Alabama, and Florida, is acquired.
1990: The company purchases J.B. Ivey & Company's 23 stores in the Carolinas and Florida.
1993: For a period, the company begins opening new stores rather acquiring existing businesses.
1998: Dillard's purchase of Mercantile Stores for $2.9 billion signals the beginning of financial difficulties for the company.
2003: Dillard's begins selling off operations as part of a strategy to recover lost financial ground.
Name Age Since Current Position
Dillard, William 66 2002 Chairman of the Board, Chief Executive Officer
Dillard, Alex 61 President, Director
Freeman, James 61 Chief Financial Officer, Senior Vice President, Director
Dillard, Mike 59 Executive Vice President, Director
Matheny, Drue 64 Executive Vice President, Director
Schroeder, Paul 63 1998 Vice President, General Counsel
Sanderford, Robin 64 1998 Vice President
Squires, Burt 61 1984 Vice President
Nelson, Steven 53 1988 Vice President
Taylor, Julie 59 1998 Vice President
Terry, David 61 1992 Vice President
Willey, Richard 60 2010 Corporate Vice President - Stores
White, Nick 66 2008 Director
Connor, Robert 69 1987 Independent Director
Watts, J. 53 2009 Independent Director
Stephens, Warren 54 2002 Independent Director
Mori, Frank 70 2008 Independent Director
Martin, R. Brad 60 2008 Independent Director
Hastings, H. Lee 56 2010 Independent Director
Address:
1600 Cantrell Road
Little Rock, Arkansas 72201
U.S.A.
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