Cato Reports April Comp Sales Down 7%

Raises 1Q EPS Estimate

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May 06, 2010, 08:22 ET

CHARLOTTE, N.C., May 6 /PRNewswire-FirstCall/ -- The Cato Corporation (NYSE: CATO) today reported sales of $74.1 million for the four weeks ended May 1, 2010, a 7% decrease from sales of $79.4 million for the four weeks ended May 2, 2009. Comparable store sales decreased 7% for the month.

Sales for the first quarter ended May 1, 2010 were $259.8 million, a 9% increase over sales of $238.1 million for the first quarter ended May 2, 2009. Comparable store sales increased 8% for the first quarter.

April sales were unfavorably impacted by the shift of Easter sales to March this year versus April last year, while March sales were favorably impacted. Because of this shift, the best measure for performance is the combined sales for the two months, which increased 10% overall and increased 9% on a comparable store basis.

"April sales were above our expectations and our quarterly results have benefited from good sell throughs of regular priced goods," said John Cato, Chairman, President, and Chief Executive Officer. "We now estimate first quarter earnings per diluted share will be in the range of $0.88 to $0.90 versus our last guidance of $0.79 to $0.83 and $0.64 last year, an increase of 38% to 41% over last year."

The Company will release first quarter results on Thursday, May 20, 2010.

During the month of April, the Company opened two new stores and relocated one store. New stores opened in Augusta, GA and League City, TX. As of May 1, 2010, the Company operated 1,272 stores in 31 states, compared to 1,285 stores in 31 states as of May 2, 2009.

The Cato Corporation is a leading specialty retailer of value-priced women's fashion apparel and accessories operating two divisions, "Cato" and "It's Fashion". The Company's Cato division offers exclusive merchandise with fashion and quality comparable to mall specialty stores at low prices every day. The It's Fashion division offers fashion with a focus on the latest trendy styles and nationally recognized urban brands for the entire family 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 first quarter, 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.

SOURCE The Cato Corporation