Cato Reports January Same-Store Sales Down 12%

Lowers 4Q and Full Year EPS Estimate

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Feb 07, 2013, 07:00 ET

CHARLOTTE, N.C., Feb. 7, 2013 /PRNewswire/ -- The Cato Corporation (NYSE: CATO) today reported sales of $63.8 million for the five weeks ended February 2, 2013, an increase of 26% over sales of $50.5 million for the four weeks ended January 28, 2012. The fiscal year ended February 2, 2013 contains 53 weeks versus 52 weeks in fiscal year ended January 28, 2012 and January 2013 contains five weeks versus four weeks in January 2012. On a comparable five-week basis, total sales for the month decreased 9% and comparable store sales decreased 12% from last year.

Sales for fiscal fourth quarter ended February 2, 2013 were $232.0 million, an increase of 5% over sales of $221.5 million for the fourth quarter ended January 28, 2012. On a comparable 14-week basis, total sales for the quarter decreased 4% and comparable store sales decreased 7% from last year. For the year, the Company's sales increased 1% to $933.8 million over 2011 sales of $920.6 million. On a comparable 53-week basis, total sales for the fiscal year ended February 2, 2013 decreased 1% and comparable store sales decreased 4% from last year.

"January same-store sales results reflect the difficult retail environment the Company faced during 2012. Sales at the beginning of the month were in line with our year-to-date trend. However, sales at the end of the month were significantly worse than trend. We think this was primarily due to the timing of tax refunds and the effect of higher payroll taxes. We are unclear what portion of the sales lost due to tax refund delays will be recouped," stated John Cato, Chairman, President, and Chief Executive Officer. "We now expect fourth quarter EPS results will be in the range of $0.27 to $0.29 versus $0.35 last year. For the year, we expect diluted earnings per share will be within the range of $2.11 to $2.13 versus $2.21 last year."

The Company will release fourth quarter and fiscal year 2012 earnings on Thursday, March 21, 2013.

During January, the Company opened three stores and closed four stores including one It's Fashion store to open an It's Fashion Metro store in the same market. New stores opened in New Albany, MS, Columbia, SC and Rosenberg, TX.

During the fourth quarter, the Company opened nine stores, relocated two stores and closed five stores. For the fiscal year ended February 2, 2013, the Company opened 34 stores, relocated nine stores and closed 12 stores. The closings for the year include two It's Fashion stores closed to open It's Fashion Metro stores in the same market. As of February 2, 2013, the Company operated 1,310 stores in 31 states, compared to 1,288 stores in 31 states as of January 28, 2012.

The Cato Corporation is a leading specialty retailer of value-priced fashion apparel and accessories operating three concepts, "Cato", "Versona" and "It's Fashion". The Company's Cato stores offer exclusive merchandise with fashion and quality comparable to mall specialty stores at low prices every day. Versona is a unique fashion destination offering accessories and apparel including jewelry, handbags and shoes at exceptional prices every day. It's Fashion offers fashion with a focus on the latest trendy styles 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 or estimated financial results for the fourth quarter and full year and any related assumptions 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 and other factors discussed under "Risk Factors" in Part I, Item 1A of the Company's most recently filed annual report on Form 10-K, as amended or supplemented, and in other reports the Company files with or furnishes to the SEC from time to time. 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