UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May ~~2, 2020~~1, 2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission File Number: 1-6140

~~1-6140~~

DILLARD’S, INC.

(Exact name of registrant as specified in its charter)



DELAWARE						71-0388071
(State or other jurisdiction						(I.R.S. Employer
of incorporation or organization)						Identification No.)

1600 CANTRELL ROAD,, LITTLE ROCK,, ARKANSAS72201

(Address of principal executive offices)

(Zip Code)

(~~501~~) (501) 376-5200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading ~~Symbol~~Symbol(s)	Name of each exchange on which registered
Class A Common Stock	DDS	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

ý Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

ý Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

ý☐

Accelerated filer

☐ý

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes ý No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

CLASS A COMMON STOCK as of May ~~30, 2020 19,219,626~~29, 2021 17,144,186

CLASS B COMMON STOCK as of May ~~30, 2020 4,010,401~~

29, 2021 3,998,233

Table of Contents

Index

DILLARD’S, INC.


					Page
					Number
PART I. FINANCIAL INFORMATION

				~~Page~~
		~~Number~~
~~PART I. FINANCIAL INFORMATION~~

Item 1.	Financial Statements (Unaudited):

			Condensed Consolidated Balance Sheets as of May 1, 2021, January 30, 2021 and May 2, 2020 ~~February 1, 2020 and May 4, 2019~~		43

			Condensed Consolidated Statements of Operations for the Three Months Ended May ~~2, 2020~~1, 2021 and May ~~4, 2019~~2, 2020		54

			Condensed Consolidated Statements of Comprehensive Income (Loss) ~~Income~~ for the Three Months Ended May ~~2, 2020~~1, 2021 and May ~~4, 2019~~2, 2020		65

			Condensed Consolidated Statements of Stockholders' Equity for the Three Months Ended May ~~2, 2020~~1, 2021 and May ~~4, 2019~~2, 2020		76

			Condensed Consolidated Statements of Cash Flows for the Three Months Ended May ~~2, 2020~~1, 2021 and May ~~4, 2019~~2, 2020		87

			Notes to Condensed Consolidated Financial Statements		98

Item 2.			Management’s Discussion and Analysis of Financial Condition and Results of Operations		1817

Item 3.			Quantitative and Qualitative Disclosures About Market Risk		28

Item 4.			Controls and Procedures		28

PART II. OTHER INFORMATION

Item 1.			Legal Proceedings		29

Item 1A.			Risk Factors		29

Item 2.			Unregistered Sales of Equity Securities and Use of Proceeds		30

Item 6.			Exhibits		31

SIGNATURES					32

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial ~~Statements~~Statements.

DILLARD’S, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In Thousands)


	May 1, 2021		January 30, 2021		May 2, 2020

Assets
Current assets:
Cash and cash equivalents	$	615,920	$	360,339	$	69,994

Accounts receivable	33,941		36,693		44,964
Merchandise inventories	1,306,508		1,087,763		1,570,313
Federal and state income taxes	73,461		118,439		39,176
Other current assets	79,004		58,706		55,223

Total current assets	2,108,834		1,661,940		1,779,670

Property and equipment (net of accumulated depreciation and amortization of $2,488,446, $2,466,000 and $2,385,686, respectively)	1,257,254		1,289,302		1,434,601
Operating lease assets	47,716		47,612		47,852
Deferred income taxes	24,815		23,453		4,908
Other assets	69,041		70,208		75,314

Total assets	$	3,507,660	$	3,092,515	$	3,342,345

Liabilities and stockholders’ equity
Current liabilities:
Trade accounts payable and accrued expenses	$	1,075,534	$	758,363	$	1,055,891

Current portion of finance lease liabilities	527		695		1,109
Current portion of operating lease liabilities	12,960		13,819		14,880



Total current liabilities	1,089,021		772,877		1,071,880

Long-term debt	365,884		365,849		365,743
Finance lease liabilities	0		0		528
Operating lease liabilities	34,536		33,392		33,353
Other liabilities	280,522		279,389		274,435

Subordinated debentures	200,000		200,000		200,000
Commitments and contingencies	0		0		0
Stockholders’ equity:
Common stock	1,240		1,240		1,239
Additional paid-in capital	954,131		954,131		951,726
Accumulated other comprehensive loss	(34,406)		(34,935)		(30,628)
Retained earnings	4,626,243		4,471,269		4,391,039
Less treasury stock, at cost	(4,009,511)		(3,950,697)		(3,916,970)

Total stockholders’ equity	1,537,697		1,441,008		1,396,406

Total liabilities and stockholders’ equity	$	3,507,660	$	3,092,515	$	3,342,345

May 2,
2020 February 1,
2020 May 4,
2019
Assets

Current assets:

Cash and cash equivalents $ 69,994
$ 277,077
$ 139,802
Restricted cash —
—
8,683
Accounts receivable 44,964
46,160
47,863
Merchandise inventories 1,570,313
1,465,007
1,832,581
Federal and state income taxes 39,176
—
—
Other current assets 55,223
59,838
66,015

Total current assets 1,779,670
1,848,082
2,094,944

Property and equipment (net of accumulated depreciation and amortization of $2,385,686, $2,336,728 and $2,259,145 respectively) 1,434,601
1,458,176
1,551,844
Operating lease assets 47,852
47,924
52,782
Deferred income taxes 4,908
—
—
Other assets 75,314
76,075
79,418

Total assets $ 3,342,345
$ 3,430,257
$ 3,778,988

Liabilities and stockholders’ equity

Current liabilities:

Trade accounts payable and accrued expenses $ 1,055,891
$ 892,789
$ 1,134,258
Current portion of finance lease liabilities 1,109
1,219
1,022
Current portion of operating lease liabilities

14,880
14,654
15,105
Federal and state income taxes —
22,158
28,961

Total current liabilities 1,071,880
930,820
1,179,346

Long-term debt 365,743
365,709
365,603
Finance lease liabilities 528
695
1,636
Operating lease liabilities 33,353
32,683
36,934
Other liabilities 274,435
273,601
240,971
Deferred income taxes —
3,490
17,590
Subordinated debentures 200,000
200,000
200,000
Commitments and contingencies

Stockholders’ equity:

Common stock 1,239
1,239
1,239
Additional paid-in capital 951,726
951,726
948,835
Accumulated other comprehensive loss (30,628 ) (31,059 ) (12,809 )
Retained earnings 4,391,039
4,556,494
4,533,973
Less treasury stock, at cost (3,916,970 ) (3,855,141 ) (3,734,330 )

Total stockholders’ equity 1,396,406
1,623,259
1,736,908

Total liabilities and stockholders’ equity $ 3,342,345
$ 3,430,257
$ 3,778,988

Three Months Ended
May 2,
2020 May 4,
2019
Net (loss) income $ (161,975 ) $ 78,602
Other comprehensive income:

Amortization of retirement plan and other retiree benefit adjustments (net of tax of $138 and $0, respectively) 431
—

Comprehensive (loss) income $ (161,544 ) $ 78,602


	Three Months Ended May 1, 2021
					Accumulated Other Comprehensive Loss
	Common Stock		Additional Paid-in Capital				Retained Earnings		Treasury Stock
											Total
Balance, January 30, 2021	$	1,240	$	954,131	$	(34,935)	$	4,471,269	$	(3,950,697)	$	1,441,008
Net income	—		—		—		158,247		—		158,247
Other comprehensive income	—		—		529		—		—		529

Purchase of 624,893 shares of treasury stock	—		—		—		—		(58,814)		(58,814)
Cash dividends declared:
Common stock, $0.15 per share	—		—		—		(3,273)		—		(3,273)
Balance, May 1, 2021	$	1,240	$	954,131	$	(34,406)	$	4,626,243	$	(4,009,511)	$	1,537,697

Three Months Ended May 2, 2020

Accumulated
Other
Comprehensive
Loss

Common Stock
Additional
Paid-in
Capital

Retained
Earnings

Treasury
Stock

Total
Balance, February 1, 2020 $ 1,239
$ 951,726
$ (31,059 ) $ 4,556,494
$ (3,855,141 ) $ 1,623,259
Net loss —
—
—
(161,975 ) —
(161,975 )
Other comprehensive income —
—
431
—
—
431
Purchase of 998,742 shares of treasury stock
—
—
—
—
(61,829 ) (61,829 )
Cash dividends declared:
Common stock, $0.15 per share —
—
—
(3,480 ) —
(3,480 )
Balance, May 2, 2020 $ 1,239
$ 951,726
$ (30,628 ) $ 4,391,039
$ (3,916,970 ) $ 1,396,406


	Three Months Ended May 2, 2020
					Accumulated Other Comprehensive Loss
	Common Stock		Additional Paid-in Capital				Retained Earnings		Treasury Stock
											Total
Balance, February 1, 2020	$	1,239	$	951,726	$	(31,059)	$	4,556,494	$	(3,855,141)	$	1,623,259
Net loss	—		—		—		(161,975)		—		(161,975)
Other comprehensive income	—		—		431		—		—		431

Purchase of 998,742 shares of treasury stock	—		—		—		—		(61,829)		(61,829)
Cash dividends declared:
Common stock, $0.15 per share	—		—		—		(3,480)		—		(3,480)
Balance, May 2, 2020	$	1,239	$	951,726	$	(30,628)	$	4,391,039	$	(3,916,970)	$	1,396,406

Three Months Ended May 4, 2019

Accumulated
Other
Comprehensive
Loss

Common Stock
Additional
Paid-in
Capital

Retained
Earnings

Treasury
Stock

Total
Balance, February 2, 2019 $ 1,239
$ 948,835
$ (12,809 ) $ 4,458,006
$ (3,716,890 ) $ 1,678,381
Net income —
—
—
78,602
—
78,602
Purchase of 246,158 shares of treasury stock —
—
—
—
(17,440 ) (17,440 )
Cash dividends declared:
Common stock, $0.10 per share —
—
—
(2,635 ) —
(2,635 )
Balance, May 4, 2019 $ 1,239
$ 948,835
$ (12,809 ) $ 4,533,973
$ (3,734,330 ) $ 1,736,908

Three Months Ended
May 2,
2020 May 4,
2019
Operating activities:

Net (loss) income $ (161,975 ) $ 78,602
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:

Depreciation and amortization of property and other deferred cost 51,381
52,533
Gain on disposal of assets (19 ) (7,400 )
Changes in operating assets and liabilities:

Decrease in accounts receivable 1,196
1,990
Increase in merchandise inventories (105,306 ) (304,164 )
Decrease in other current assets 4,615
2,738
Decrease (increase) in other assets 1,162
(2,149 )
Increase in trade accounts payable and accrued expenses and other liabilities 161,463
204,259
(Decrease) increase in income taxes (63,642 ) 21,948

Net cash (used in) provided by operating activities (111,125 ) 48,357

Investing activities:

Purchases of property and equipment and capitalized software (20,230 ) (18,739 )
Proceeds from disposal of assets 111
13,437
Distribution from joint venture 215
215

Net cash used in investing activities (19,904 ) (5,087 )

Financing activities:

Principal payments on long-term debt and finance lease liabilities (277 ) (222 )
Issuance cost of line of credit (2,920 ) —
Cash dividends paid (3,705 ) (2,632 )
Purchase of treasury stock (69,152 ) (15,440 )

Net cash used in financing activities (76,054 ) (18,294 )

(Decrease) increase in cash, cash equivalents and restricted cash (207,083 ) 24,976
Cash, cash equivalents and restricted cash, beginning of period 277,077
123,509

Cash, cash equivalents and restricted cash, end of period $ 69,994
$ 148,485

Non-cash transactions:

Accrued capital expenditures $ 8,314
$ 6,657
Accrued purchases of treasury stock —
2,000
Lease assets obtained in exchange for new operating lease liabilities 3,972
—

The accompanying unaudited interim condensed consolidated financial statements of Dillard’s, Inc. (the “Company”) have been prepared in accordance with the rules of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended May ~~2, 2020~~1, 2021 are not necessarily indicative of the results that may be expected for the fiscal year ending January ~~30, 2021~~29, 2022 due to, among other factors, the seasonal nature of the ~~business.~~business and the ongoing effect of the COVID-19 pandemic.

These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended ~~February 1, 2020~~January 30, 2021 filed with the SEC on March ~~31, 2020.~~

~~Restricted Cash~~
- Restricted cash consists of cash proceeds from the sale of property held in escrow for the acquisition of replacement property under like-kind exchange agreements. The escrow accounts are administered by an intermediary. Pursuant to the like-kind exchange agreements, the cash remains restricted for a maximum of 180 days from the date of the property sale pending the acquisition of replacement property.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows.

(in thousands) May 2,
2020 May 4,
2019
Cash and cash equivalents $ 69,994
$ 139,802
Restricted cash —
8,683
Total cash, cash equivalents and restricted cash $ 69,994
$ 148,485

In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic, which continues to ~~spread throughout~~impact the United States and ~~the world.~~ global economies. The ~~effects of the~~ COVID-19 pandemic has had and ~~continues~~may continue to have a significant impact on the Company's business, results of operations and financial position. At present, the COVID-19 pandemic has had a significant negative effect on the Company's liquidity and net sales. Due to heightened uncertainty relating to the impacts of COVID-19 on the Company’s business operations, including the duration and impact on overall customer demand, our liquidity and net sales may be further impacted if we are unable to appropriately manage our inventory levels and expenses.

The Company began closing stores on March 19, 2020 as mandated by state and local governments, and by April 9, 2020, all ~~285~~brick-and-mortar store locations were temporarily ~~closed. At~~closed to the ~~peak~~public. Our eCommerce capabilities allowed us to use our closed store locations (with limited staffing) to fill orders from our Internet store.

During the month ended May 30, 2020 (fiscal May), we re-opened most of ~~store closures, approximately 90% of Dillard's 38,000 associates were furloughed. The Company began re-opening~~our full-line stores, ~~on May 5, 2020,~~ and by June 2, 2020 all ~~stores~~Dillard's store locations had been re-opened.

As part of the Company's liquidity strategy during the COVID-19 pandemic, in March 2020, the Company borrowed $779 million under the credit agreement, which was repaid concurrent with the execution of the amended credit agreement. At May 2, 2020, no borrowings were outstanding, and letters of credit totaling $21.0 million were issued under the amended credit agreement leaving unutilized availability under the facility of $779.0 million. See Note 7, Revolving Credit Agreement, for additional information.

We assess the impairment of long-lived assets, primarily fixed assets and operating lease assets, whenever events or changes in circumstances indicate that the carrying value may not be recoverable. We evaluated the effects of the COVID-19 pandemic on Following our ~~business and determined that as of May 2, 2020, the carrying values~~re-opening, a very small number of our ~~property~~locations were temporarily closed to in-store shopping due to government mandate. All stores are currently open and ~~equipment and~~are operating ~~lease assets were recoverable. Accordingly, no impairment charge was recorded for~~at reduced hours from fiscal 2019 operating hours. While the ~~quarter ended May 2, 2020. We will continue~~availability of vaccinations has led to ~~monitor these factors~~re-openings across the country and the easing of restrictions, the continuing financial impact ~~of the COVID-19 pandemic on future periods and continue~~ to ~~assess these assets for impairment as needed.~~ fiscal 2021 cannot be reasonably estimated at this time.

Recently ~~Issued~~Adopted Accounting Pronouncements

Simplifying the Accounting for Income Taxes

In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, as part of its initiative to reduce complexity in accounting standards. The amendments in this update simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. The amendments within ASU No. 2019-12 are effective for financial statements issued for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, and early adoption is permitted. The ~~Company is currently assessing the impact~~adoption of this update did not have a material impact on ~~its~~the Company's consolidated financial statements.

Facilitation of the Effects of Reference Rate Reform

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform, which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference the London Inter-Bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. This guidance is optional for a limited period of time to ease the potential burden in accounting for, or recognizing the effects of, reference rate reform on financial reporting. More specifically, the amendments in ASU 2020-04 provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. This guidance is effective from March 12, 2020 through December 31, 2022. Entities may elect to adopt the amendments for contract modifications as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or prospectively from a date within an interim period that

includes or is subsequent to March 12, 2020, up to the date that the financial statements are available to be issued. The adoption of this update did not have a material impact on the Company's consolidated financial statements.

Recently Issued Accounting Pronouncements

Management believes there is no other accounting guidance issued but not yet effective that would be relevant to the Company's current financial statements.

The Company operates in 2 reportable segments: the operation of retail department stores (“retail operations”) and a general contracting construction company (“construction”).

For the Company’s retail operations, the Company determined its operating segments on a store by store basis. Each store’s operating performance has been aggregated into 1 reportable segment. The Company’s operating segments are aggregated for financial reporting purposes because they are similar in each of the following areas: economic characteristics, class of consumer, nature of products and distribution methods. Revenues from external customers are derived from merchandise sales, and the Company does not rely on any major customers as a source of revenue. Across all stores, the Company operates 1 store format under the Dillard’s name where each store offers the same general mix of merchandise with similar categories and similar customers. The Company believes that disaggregating its operating segments would not provide meaningful additional information.

The following table summarizes the percentage of net sales by segment and major product line:


	Three Months Ended
	May 1, 2021		May 2, 2020
Retail operations segment
Cosmetics	14	%	15	%
Ladies’ apparel	23		22
Ladies’ accessories and lingerie	15		14
Juniors’ and children’s apparel	11		10
Men’s apparel and accessories	17		16
Shoes	15		15
Home and furniture	3		3
	98		95
Construction segment	2		5
Total	100	%	100	%

Three Months Ended
May 2, 2020 May 4, 2019
Retail operations segment

Cosmetics 15 % 14 %
Ladies’ apparel 22
24
Ladies’ accessories and lingerie 14
14
Juniors’ and children’s apparel 10
11
Men’s apparel and accessories 16
16
Shoes 15
15
Home and furniture 3
3
95
97
Construction segment 5
3
Total 100 %
100 %

The following tables summarize certain segment information, including the reconciliation of those items to the Company’s consolidated operations:

(in thousands of dollars)
Retail
Operations

Construction
Consolidated
Three Months Ended May 2, 2020:

Net sales from external customers $ 751,027
$ 35,628

$ 786,655
Gross profit 96,034
2,152

98,186
Depreciation and amortization 50,732
169

50,901
Interest and debt expense (income), net 12,291
(21 )
12,270
(Loss) income before income taxes (228,667 ) 522

(228,145 )
Total assets 3,299,363
42,982

3,342,345

Three Months Ended May 4, 2019:

Net sales from external customers $ 1,420,522
$ 44,919

$ 1,465,441
Gross profit 536,371
1,303

537,674
Depreciation and amortization 52,194
170

52,364
Interest and debt expense (income), net 11,264
(27 )
11,237
Income before income taxes 100,728
44

100,772
Total assets 3,731,040
47,948

3,778,988

Intersegment construction revenues of ~~$11.4~~$4.3 million and ~~$8.4~~$11.4 million for the three months ended May ~~2, 2020~~1, 2021 and May ~~4, 2019,~~2, 2020, respectively, were eliminated during consolidation and have been excluded from net sales for the respective periods.

The retail operations segment gives rise to contract liabilities through the customer loyalty program associated with Dillard's private label cards and through the issuances of gift cards. The loyalty program liability and a portion of the gift card liability is included in trade accounts payable and accrued expenses, and a portion of the gift card liability is included in other liabilities on the condensed consolidated balance sheets. Our retail operations segment contract liabilities are as follows:



Retail
(in thousands of dollars)	May 1, 2021		January 30, 2021		May 2, 2020		February 1, 2020
Contract liabilities	$	61,367	$	68,021	$	67,107	$	75,229

Retail
(in thousands of dollars) May 2,
2020 February 1,
2020 May 4,
2019 February 2,
2019
Contract liabilities $ 67,107
$ 75,229
$ 64,934
$ 72,852

During the three months ended May ~~2, 2020~~1, 2021 and May ~~4, 2019,~~2, 2020, the Company recorded ~~$18.9~~$18.1 million and ~~$24.8~~$18.9 million, respectively, in revenue that was previously included in the retail operations contract liability balances of $68.0 million and $75.2 million at January 30, 2021 and ~~$72.9 million, at~~ February 1, 2020, ~~and February 2, 2019,~~ respectively.

Construction contracts give rise to accounts receivable, contract assets and contract liabilities. We record accounts receivable based on amounts expected to be collected from customers. We also record costs and estimated earnings in excess of billings on uncompleted contracts (contract assets) and billings in excess of costs and estimated earnings on uncompleted contracts (contract liabilities) in other current assets and trade accounts payable and accrued expenses in the condensed consolidated balance sheets, respectively. The amounts included in the condensed consolidated balance sheets are as follows:



Construction
(in thousands of dollars)	May 1, 2021		January 30, 2021		May 2, 2020		February 1, 2020
Accounts receivable	$	24,064	$	25,094	$	33,736	$	28,522
Costs and estimated earnings in excess of billings on uncompleted contracts	1,195		450		894		2,179
Billings in excess of costs and estimated earnings on uncompleted contracts	4,941		4,685		9,603		5,737

Construction
(in thousands of dollars) May 2,
2020 February 1,
2020 May 4,
2019 February 2,
2019
Accounts receivable $ 33,736
$ 28,522
$ 32,320
$ 31,867
Costs and estimated earnings in excess of billings on uncompleted contracts 894
2,179
829
1,165
Billings in excess of costs and estimated earnings on uncompleted contracts 9,603
5,737
6,768
7,414

Table of Contents

During the three months ended May ~~2, 2020~~1, 2021 and May ~~4, 2019,~~2, 2020, the Company recorded ~~$4.2~~$3.7 million and ~~$6.6~~$4.2 million, respectively, in revenue that was previously included in billings in excess of costs and estimated earnings on uncompleted contracts of $4.7 million and $5.7 million at January 30, 2021 and ~~$7.4 million at~~ February 1, 2020, ~~and February 2, 2019,~~ respectively.

The remaining performance obligations related to executed construction contracts totaled ~~$145.4~~$54.4 million, ~~$156.5~~$76.2 million and ~~$123.4~~$145.4 million at May 1, 2021, January 30, 2021 and May 2, 2020, ~~February 1, 2020 and May 4, 2019,~~ respectively.

Note 4. Earnings (Loss) ~~Earnings~~ Per Share Data

The following table sets forth the computation of basic and diluted earnings (loss) ~~earnings~~ per share for the periods indicated (in thousands, except per share data).

Three Months Ended
May 2,
2020 May 4,
2019
Net (loss) income $ (161,975 ) $ 78,602

Weighted average shares of common stock outstanding 23,354
26,315

Basic and diluted (loss) earnings per share $ (6.94 ) $ 2.99


	Three Months Ended
	May 1, 2021		May 2, 2020
Net income (loss)	$	158,247	$	(161,975)

Weighted average shares of common stock outstanding	21,837		23,354

Basic and diluted earnings (loss) per share	$	7.25	$	(6.94)

The Company maintains a capital structure in which common stock is the only equity security issued and outstanding, and there were 0 shares of preferred stock, stock options, other dilutive securities or potentially dilutive securities issued or outstanding during the three months ended May ~~2, 2020~~1, 2021 and May ~~4, 2019.~~2, 2020.

Note 5. Commitments and Contingencies

Various legal proceedings, in the form of lawsuits and claims, which occur in the normal course of business, are pending against the Company and its subsidiaries. In the opinion of management, disposition of these matters, individually or in the aggregate, is not expected to have a material adverse effect on the Company’s financial position, cash flows or results of operations.

At May ~~2, 2020~~,1, 2021, letters of credit totaling ~~$21.0~~$20.1 million were issued under the Company’s revolving credit facility. See Note 7, Revolving Credit Agreement, for additional information.

Note 6. Benefit Plans

The Company has an unfunded, nonqualified defined benefit plan (“Pension Plan”) for its officers. The Pension Plan is noncontributory and provides benefits based on years of service and compensation during employment. The Company determines pension expense using an actuarial cost method to estimate the total benefits ultimately payable to officers and allocates this cost to service periods. The actuarial assumptions used to calculate pension costs are reviewed annually. The Company contributed $1.4 million to the Pension Plan during the three months ended May ~~2, 2020~~1, 2021 and expects to make additional contributions to the Pension Plan of approximately ~~$4.1~~$4.9 million during the remainder of fiscal ~~2020~~.2021.

The components of net periodic benefit costs are as follows (in thousands):


	Three Months Ended
	May 1, 2021		May 2, 2020
Components of net periodic benefit costs:
Service cost	$	1,067	$	1,090
Interest cost	1,437		1,536
Net actuarial loss	697		569
Net periodic benefit costs	$	3,201	$	3,195

Three Months Ended
May 2,
2020 May 4,
2019
Components of net periodic benefit costs:

Service cost $ 1,090
$ 905
Interest cost 1,536
1,917
Net actuarial loss 569
—
Net periodic benefit costs $ 3,195
$ 2,822

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The service cost component of net periodic benefit costs is included in selling, general and administrative expenses, and the interest cost and net actuarial loss components are included in other expense.

Note 7. Revolving Credit Agreement

InThe Company maintained an unsecured credit facility that provided a borrowing capacity of $800 million with a $200 million expansion option ("credit agreement") until the credit agreement was amended in April 2020 ~~the Company~~(the "2020 amended ~~its credit agreement (the "amended~~ credit agreement"). After giving effect to the amendment, the 2020 amended credit agreement became secured by certain deposit accounts of the Company and certain inventory of certain subsidiaries. ~~The~~

In April 2021, the Company further amended its secured credit agreement (the "2021 amended credit ~~agreement provides a~~agreement"). The borrowing capacity ofremained at $800 million, subject to certain limitations as outlined in the 2021 amended credit agreement, with a $200 million expansion ~~option and matures on August 9, 2022.~~option. The 2021 amended credit agreement is available to the Company for general corporate purposes including, among other uses, working capital financing, the issuance of letters of credit, capital expenditures and, subject to certain restrictions, the repayment of existing indebtedness and share repurchases. The Company pays a variable rate of interest on borrowings under the 2021 amended credit agreement and a commitment fee to the participating banks. The rate of interest on borrowings under the 2021 amended credit agreement is LIBOR plus ~~1.750%~~1.75% if average quarterly availability is less than 50% of the total commitment, as defined in the 2021 amended credit agreement ("total commitment"), and the rate of interest on borrowings is LIBOR plus 1.50% if average quarterly availability is greater than or equal to 50% of the total commitment. The commitment fee for unused borrowings is 0.30% per ~~annum.~~annum if availability is less than 35% of the total commitment and 0.25% if availability is greater than or equal to 35% of the total commitment. As long as availability exceeds ~~$100~~$80 million and ~~no event~~certain events of default ~~occurs~~have not occurred and isare not continuing, there are no financial covenant requirements under the 2021 amended credit agreement.

Concurrent with the signing of the amended credit facility, the Company repaid the $779 million borrowed on March 25, 2020 under the previous agreement. Additionally, the Company paid $2.9 million in issuance costs related to theThe 2021 amended credit agreement ~~which were recorded in other assets~~matures on ~~the condensed consolidated balance sheets.~~April 28, 2026.

At May ~~2, 2020,~~1, 2021, 0 borrowings were outstanding, and letters of credit totaling ~~$21.0~~$20.1 million were issued under the amended credit agreement leaving unutilized availability under the credit facility of ~~$779.0~~$779.9 million.

Note 8. Stock Repurchase ~~Program~~Programs

In March 2018, the Company's Board of Directors authorized the ~~Company to~~ repurchase of up to $500 million of the Company’s Class A Common Stock ~~pursuant to~~under an open-ended stock repurchase plan ~~(the "March~~("March 2018 Plan"). The March 2018 Plan permits the Company to repurchase its Class A Common Stock in the open market, pursuant to preset trading plans meeting the requirements of Rule 10b5-1 under the Securities Exchange Act of 1934 or through privately negotiated transactions and has no expiration date. As of May 1, 2021, $114.3 million of authorization remained under the March 2018 Plan.

The following is a summary of share repurchase activity under the March 2018 Plan for the periods indicated (in thousands, except per share data):


	Three Months Ended
	May 1, 2021		May 2, 2020
Cost of shares repurchased	$	58,814	$	61,829
Number of shares repurchased	625		999
Average price per share	$	94.12	$	61.91

All repurchases of the Company’s Class A Common Stock above were made at the market price at the trade date. All amounts paid to reacquire these shares were allocated to treasury stock.

On May 15, 2021, the Company announced that its Board of Directors approved a new stock repurchase program authorizing the Company to repurchase up to $500 million of its Class A Common Stock. This new open-ended authorization permits the Company to repurchase its Class A Common Stock in the open market, pursuant to preset trading plans meeting the requirements of Rule 10b5-1 under the Securities Exchange Act of 1934 or through privately negotiated ~~transactions. The March 2018 plan~~transactions and has no expiration date.

~~The following is a summary of share repurchase activity for the periods indicated (in thousands, except per share data):~~

Three Months Ended
May 2,
2020 May 4,
2019
Cost of shares repurchased $ 61,829
$ 17,440
Number of shares repurchased 999
246
Average price per share $ 61.91
$ 70.85

~~All repurchases~~

Table of the Company’s Class A Common Stock above were made at the market price at the trade date. Accordingly, all amounts paid to reacquire these shares were allocated to treasury stock. As of May 2, 2020, $206.9 million of authorization remained under the March 2018 Plan.Contents

Note 9. Income Taxes

During the three months ended May 1, 2021, income tax expense differed from what would be computed using the statutory federal income tax rate primarily due to the effects of state and local income taxes and federal tax credits.

The Company ~~expects to be~~was in a net operating loss position for the fiscal ~~year.~~year ended January 30, 2021. The Coronavirus Aid, Relief and Economic Security (“CARES”) Act, signed into law on March 27, 2020, allows for net operating loss carryback to years in which the statutory federal tax rate was 35% rather than the current 21%. During the three months ended May 2, 2020, income tax benefit differed from what would be computed using the current statutory federal tax rate of 21% primarily due to the recognition of a net tax benefit of $14.8 million related to the rate differential in the carryback provision of the CARES Act. This net tax benefit was comprised of tax expense of $25.2 million for the remeasurement of beginning deferred tax assets and liabilities and tax benefit of $40.0 million for the impact of the net operating loss carryback.year. Income tax benefit for the quarter also included the effects of ~~federal tax credits and~~ state and local income ~~taxes.~~

~~During the three months ended May 4, 2019, income tax expense differed from what would be computed using the statutory~~taxes and federal tax ~~rate primarily due to the effects of federal tax credits and state and local income taxes.~~credits.

Note 10. Reclassifications from Accumulated Other Comprehensive Loss (“AOCL”)

Reclassifications from AOCL are summarized as follows (in thousands):

Amount Reclassified from AOCL
Three Months Ended Affected Line Item in the Statement Where Net Income Is Presented
Details about AOCL Components May 2, 2020 May 4, 2019
Defined benefit pension plan items

Amortization of actuarial losses $ 569
$ —
Total before tax (1)
138
—
Income tax expense
$ 431
$ —
Total net of tax

~~For fiscal year 2019, there was 0 amortization of the net loss in AOCL as the net loss did not exceed 10% of the projected benefit obligation.~~


	Amount Reclassified from AOCL
	Three Months Ended				Affected Line Item in the Statement Where Net Income Is Presented
Details about AOCL Components	May 1, 2021		May 2, 2020
Defined benefit pension plan items

Amortization of actuarial losses	$	697	$	569		Total before tax (1)
	168		138			Income tax expense
	$	529	$	431		Total net of tax

(1) This item is included in the computation of net periodic pension cost. See Note 6, Benefit Plans, for additional information.

Note 11. Changes in Accumulated Other Comprehensive Loss

Changes in AOCL by component (net of tax) are summarized as follows (in thousands):


	Defined Benefit Pension Plan Items
	Three Months Ended
	May 1, 2021		May 2, 2020
Beginning balance	$	34,935	$	31,059


Amounts reclassified from AOCL	(529)		(431)


Ending balance	$	34,406	$	30,628

Defined Benefit Pension Plan Items
Three Months Ended
May 2, 2020 May 4, 2019
Beginning balance $ 31,059
$ 12,809

Amounts reclassified from AOCL (431 ) —

Ending balance $ 30,628
$ 12,809

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Note 12. Leases

The Company leases retail stores, office space and equipment under operating leases. As of May ~~2, 2020~~1, 2021, January 30, 2021 and May ~~4, 2019~~2, 2020, right-of-use operating lease assets, which are recorded in operating lease assets in the condensed consolidated balance sheets, totaled ~~$47.9~~$47.7 million, $47.6 million and ~~$52.8~~$47.9 million, respectively, and operating lease liabilities, which are recorded in current portion of operating lease liabilities and operating lease liabilities, totaled ~~$48.2~~$47.5 million, $47.2 million and ~~$52.0~~$48.2 million, respectively.

In determining our operating lease assets and operating lease liabilities, we apply an incremental borrowing rate to the minimum lease payments within each lease agreement. ~~ASU No. 2016-02~~GAAP requires the use of the rate implicit in the lease whenever that rate is readily determinable; furthermore, if the implicit rate is not readily determinable, a lessee may use its incremental borrowing rate. The incremental borrowing rate is the rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. To estimate our specific incremental borrowing rates that align with applicable lease terms, we utilize a model consistent with the credit quality of our outstanding debt instruments.

Renewal options ~~from two to 20~~of five or 10 years exist on the majority of leased properties. The Company has sole discretion in exercising the lease renewal options. We do not recognize operating lease assets or operating lease liabilities at lease inception for renewal periods unless ~~it has been determined that~~ we are reasonably certain of ~~renewing~~exercising the ~~lease at inception.~~renewal options. The depreciable life of operating lease assets and related leasehold improvements is limited by the expected lease term.

Contingent rentals on certain leases are based on a percentage of annual sales in excess of specified amounts. Other contingent rentals are based entirely on a percentage of sales. The Company's operating lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The following table summarizes the Company's operating and finance leases:

(in thousands of dollars) Classification - Condensed Consolidated Balance Sheets May 2, 2020 February 1, 2020 May 4, 2019
Assets
Finance lease assets
Property and equipment, net ^(a)
$ 564
$ 670
$ 987
Operating lease assets Operating lease assets 47,852
47,924
52,782
Total leased assets $ 48,416

$ 48,594

$ 53,769

Liabilities
Current
     Finance Current portion of finance lease liabilities $ 1,109
$ 1,219
$ 1,022
     Operating Current portion of operating lease liabilities 14,880
14,654
15,105
Noncurrent
     Finance Finance lease liabilities 528
695
1,636
     Operating Operating lease liabilities 33,353
32,683
36,934
Total lease liabilities $ 49,870

$ 49,251

$ 54,697


(in thousands of dollars)	Classification - Condensed Consolidated Balance Sheets	May 1, 2021		January 30, 2021		May 2, 2020
Assets
Finance lease assets	Property and equipment, net (a)	$	185	$	247	$	564
Operating lease assets	Operating lease assets	47,716		47,612		47,852
Total leased assets		$	47,901	$	47,859	$	48,416

Liabilities
Current
Finance	Current portion of finance lease liabilities	$	527	$	695	$	1,109
Operating	Current portion of operating lease liabilities	12,960		13,819		14,880
Noncurrent
Finance	Finance lease liabilities	0		0		528
Operating	Operating lease liabilities	34,536		33,392		33,353
Total lease liabilities		$	48,023	$	47,906	$	49,870

^(a) Finance lease assets are recorded net of accumulated amortization of ~~$14.0~~$14.4 million, ~~$13.9~~$14.3 million and ~~$13.6~~$14.0 million as of May ~~2, 2020, February~~ 1, ~~2020~~2021, January 30, 2021 and May ~~4, 2019,~~2, 2020, respectively.

Lease Cost Three Months Ended
(in thousands of dollars) Classification - Condensed Consolidated Statements of Operations May 2, 2020 May 4, 2019
Operating lease cost ^(a)
Rentals $ 5,550
$ 6,118
Finance lease cost
Amortization of leased assets Depreciation and amortization 106
106
Interest on lease liabilities Interest and debt expense, net 79
135
Net lease cost $ 5,735
$ 6,359

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Lease Cost		Three Months Ended
(in thousands of dollars)	Classification - Condensed Consolidated Statements of Operations	May 1, 2021		May 2, 2020
Operating lease cost (a)	Rentals	$	5,111	$	5,550
Finance lease cost
Amortization of leased assets	Depreciation and amortization	62		106
Interest on lease liabilities	Interest and debt expense, net	14		79
Net lease cost		$	5,187	$	5,735

^(a)Includes short term lease costs of ~~$0.5~~$0.4 million and ~~$0.7~~$0.5 million for the three months ended May ~~2, 2020~~1, 2021 and May ~~4, 2019,~~2, 2020, respectively, and variable lease costs, including contingent rent, of ~~$0.3~~$0.4 million and ~~$0.4~~$0.3 million for the three months ended May 1, 2021 and May 2, 2020, ~~and May 4, 2019,~~ respectively.

Maturities of Lease Liabilities


(in thousands of dollars) Fiscal Year	Operating Leases		Finance Leases		Total
2021 (excluding the three months ended May 1, 2021)	$	11,865	$	544	$	12,409
2022	13,017		0		13,017
2023	9,347		0		9,347
2024	4,673		0		4,673
2025	4,013		0		4,013
After 2025	14,138		0		14,138
Total minimum lease payments	57,053		544		57,597
Less amount representing interest	(9,557)		(17)		(9,574)
Present value of lease liabilities	$	47,496	$	527	$	48,023

(in thousands of dollars)
Fiscal Year
Operating
Leases

Finance
Leases
Total
2020 (excluding the three months ended May 2, 2020) $ 13,275
$ 1,071
$ 14,346
2021 14,048
726
14,774
2022 7,696
—
7,696
2023 4,406
—
4,406
2024 3,649
—
3,649
After 2024 15,916
—
15,916
Total minimum lease payments 58,990
1,797
60,787
Less amount representing interest (10,757 ) (160 ) (10,917 )
Present value of lease liabilities $ 48,233

$ 1,637
$ 49,870

Lease Term and Discount Rate



	May ~~2, 2020~~1, 2021
Weighted-average remaining lease term
Operating leases	~~6.2~~5.9 years
Finance leases	~~1.5~~0.8 years
Weighted-average discount rate
Operating leases	~~6.6~~6.1	%
Finance leases	149.5	%

Other Information


	Three Months Ended
(in thousands of dollars)	May 1, 2021		May 2, 2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	4,244	$	4,720
Operating cash flows from finance leases	14		79
Financing cash flows from finance leases	168		277

Lease assets obtained in exchange for new operating lease liabilities	$	3,815	$	3,972

Three Months Ended
(in thousands of dollars) May 2, 2020 May 4, 2019
Cash paid for amounts included in the measurement of lease liabilities
     Operating cash flows from operating leases $ 4,720
$ 5,046
     Operating cash flows from finance leases 79
135
     Financing cash flows from finance leases 277
222

Lease assets obtained in exchange for new operating lease liabilities $ 3,972
$ —

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Note 13. Gain on Disposal of Assets

During the three months ended May ~~4, 2019,~~1, 2021, the Company ~~received~~recorded proceeds of ~~$13.4~~$29.3 million primarily from the sale of ~~two~~three store properties, resulting in a gain of ~~$7.4~~$24.7 million that was recorded in gain on disposal of assets.

Note 14. Fair Value Disclosures

The estimated fair values of financial instruments presented herein have been determined by the Company using available market information and appropriate valuation methodologies. However, considerable judgment is required in interpreting market data to develop estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of amounts the Company could realize in a current market exchange.

The fair value of the Company’s long-term debt and subordinated debentures is based on market prices and is categorized as Level 1 in the fair value hierarchy.

The fair value of the Company’s cash and cash equivalents and accounts receivable approximates their carrying values at May ~~2, 2020~~1, 2021 due to the short-term maturities of these instruments. The fair value of the Company’s long-term debt at May ~~2, 2020~~1, 2021 was approximately ~~$309~~$422 million. The carrying value of the Company’s long-term debt at May ~~2, 2020~~1, 2021 was ~~$365.7~~$365.9 million. The fair value of the Company’s subordinated debentures at May ~~2, 2020~~1, 2021 was approximately ~~$131~~$206 million. The carrying value of the Company’s subordinated debentures at May ~~2, 2020~~1, 2021 was $200.0 million.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of ~~Operations~~Operations.

The following discussion should be read in conjunction with the condensed consolidated financial statements and the footnotes thereto included elsewhere in this report, as well as the financial and other information included in our Annual Report on Form 10-K for the year ended ~~February 1, 2020.~~January 30, 2021. Due to the significant impact of COVID-19 on prior year figures, the information that follows will include certain comparisons to 2019 to provide additional context.

EXECUTIVE OVERVIEW

In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic, which continues to ~~spread throughout~~impact the United States and ~~the world.~~global economies. The ~~effects of the~~ COVID-19 pandemic has had and ~~continues~~may continue to have a significant impact on the Company's business, results of operations and financial position. The Company began closing stores on March 19, 2020 as mandated by state and local governments, and by April 9, 2020, all ~~285~~of the Company's brick-and-mortar store locations were temporarily ~~closed.~~closed to the public. Our eCommerce capabilities allowed us to use our closed store locations (with limited staffing) to fill orders from our Internet store.

During the month ended May 30, 2020 (fiscal May), we re-opened most of our full-line stores, and by June 2, 2020 all Dillard's store locations had been re-opened. Following our re-opening, a very small number of our locations were temporarily closed to in-store shopping due to government mandate. All stores are currently open and are operating at reduced hours from fiscal 2019 operating hours.

The Company's performance for the three months ended May 1, 2021 improved significantly compared to the three months ended May 2, ~~2020, total~~2020. Total retail sales ~~decreased 47%.~~increased approximately 73% over the first quarter of 2020, as the arrival of vaccinations and release of stimulus money combined with warmer weather during the first quarter of 2021 were catalysts in addition to the re-opening of stores. Due to the temporary closure of the Company's brick-and-mortar stores during the three months ended May 2, 2020 as well as the interdependence between in-store and online sales, the Company reported no comparable store sales data for the three months ended May 1, 2021 compared to the three months ended May 2, 2020. Retail gross ~~margins decreased significantly~~margin increased to a record 42.6% during the three months ended May 1, 2021 compared to 12.8% during the three months ended May 2, 2020, ~~compared to 37.8% during the three months ended May 4, 2019,~~ primarily due to decreased markdowns. The Company ~~was able to reduce~~reduced inventory by ~~14%~~approximately 17% compared to the prior year first ~~quarter by reducing purchases 33% through the cancellation, delay and suspension of merchandise orders and by taking aggressive markdowns.~~quarter. Selling, general and administrative expenses ~~decreased~~increased to ~~$290.4~~$336.6 million compared to ~~$405.2~~$290.4 million from the prior year first quarter primarily due to ~~decreases~~increases in payroll expense, ~~associated with~~which was driven by the ~~furlough~~re-opening of our retail store associates, support facility functions and corporate employees. At the peak of store closures, approximately 90% of Dillard's 38,000 associates were furloughed. Payroll expense for the 13 weeks ended May 2, 2020 was $168.5 million compared to $257.5 million for the 13 weeks ended May 4, 2019, a decline of 35%.locations. The Company reported net income of $158.2 million (a record $7.25 per share) compared to a ~~consolidated~~ net loss of $162.0 million ($6.94 per share) ~~compared to net income of $78.6 million ($2.99 per share)~~ for the prior year first quarter.

The Company expects to be in a net operating loss position for fiscal year 2020. The Coronavirus Aid, Relief and Economic Security (“CARES”) Act, signed into law on March 27, 2020, allows for net operating loss carryback to years in which the tax rate was 35%. Included in net income for the three months ended May 1, 2021 is a pretax gain on disposal of assets of $24.7 million ($19.2 million after tax or $0.88 per share) primarily related to the sale of three store properties. Included in the net loss for the ~~quarter~~three months ended May 2, 2020 is a net tax benefit of $14.8 million ($0.63 per share) related to ~~this provision.~~ The Coronavirus Aid, Relief and Economic Security Act ("CARES Act"), signed into law on March 27, 2020, which allowed for net operating loss carryback to years in which the federal income tax rate was 35%.

~~Included in net income for the quarter ended May 4, 2019 was a pretax gain of $7.4 million ($5.8 million after tax or $0.22 per share) related to the sale of two stores.~~

During the three months ended May ~~2, 2020,~~1, 2021, the Company purchased ~~$61.8~~$58.8 million of its outstanding Class A Common Stock under its stock repurchase plan authorized by the Company's Board of Directors in March 2018 (the "March 2018 Plan"). As of May ~~2, 2020,~~1, 2021, authorization of ~~$206.9~~$114.3 million remained under the March 2018 Plan. On May 15, 2021, the Company announced that its Board of Directors approved a new stock repurchase program authorizing the Company to repurchase up to $500 million of its Class A Common Stock.

As of May ~~2, 2020,~~1, 2021, the Company had working capital of ~~$707.8~~$1,019.8 million (including cash and cash equivalents of ~~$70.0~~$615.9 million) and ~~$565.7~~$565.9 million of total debt outstanding, excluding finance lease liabilities and operating lease ~~liabilities.~~liabilities, with no scheduled maturities until the end of fiscal 2022. Cash flows ~~used in~~provided by operating activities were ~~$111.1~~$302.4 million for the three months ended May ~~2, 2020.~~1, 2021.

The Company maintained ~~285~~281 Dillard's stores, including 3031 clearance centers, and ~~one~~an internet store at May ~~2, 2020.~~1, 2021.

On February 25, 2020, the Company provided estimates for certain financial statement items, including depreciation and amortization, rentals, interest and debt expense, net and capital expenditures, for the fiscal year ending January 30, 2021 based upon current conditions at that time, which did not include the impact

Table of COVID-19. Due to heightened uncertainty relating to the impacts of COVID-19 on the Company’s business operations, including the duration and impact on overall customer demand, the Company previously withdrew its 2020 guidance.Contents

During the four weeks ended May 30, 2020 (fiscal May), we re-opened most of our full-line stores: 45 stores on May 5th, 80 stores on May 12th, 115 stores on May 19th and 20th and 8 stores on May 26th. All of these stores have been operating at reduced hours. Sales performance in these stores since re-opening and through May 30th was approximately 68% of prior year sales on corresponding days. As of June 2, 2020, all Dillard’s stores had been re-opened.

Key Performance Indicators

We use a number of key indicators of financial condition and operating performance to evaluate our business, including the following:

Three Months Ended
May 2,
2020 May 4,
2019
Net sales (in millions) $ 786.7
$ 1,465.4
Retail stores sales trend (47 )% 1 %
Gross profit (in millions) $ 98.2
$ 537.7
Gross profit as a percentage of net sales 12.5 % 36.7 %
Retail gross profit as a percentage of net sales 12.8 % 37.8 %
Selling, general and administrative expenses as a percentage of net sales 36.9 % 27.6 %
Cash flow (used in) provided by operations (in millions) $ (111.1 ) $ 48.4
Total retail store count at end of period 285
289
Retail sales per square foot $ 16
$ 30
Retail store inventory trend (14 )% 3 %
Annualized retail merchandise inventory turnover 1.6
2.1


	Three Months Ended
	May 1, 2021			May 2, 2020
Net sales (in millions)	$	1,328.5		$	786.7
Retail stores sales trend	73		%	(47)		%

Gross profit (in millions)	$	554.5		$	98.2
Gross profit as a percentage of net sales	41.7		%	12.5		%
Retail gross profit as a percentage of net sales	42.6		%	12.8		%
Selling, general and administrative expenses as a percentage of net sales	25.3		%	36.9		%
Cash flow provided by (used in) operations (in millions)	$	302.4		$	(111.1)
Total retail store count at end of period	281			285
Retail sales per square foot	$	28		$	16
Retail store inventory trend	(17)		%	(14)		%
Annualized retail merchandise inventory turnover	2.5			1.6

General

Net sales. Net sales includes merchandise sales of comparable and non-comparable stores and revenue recognized on contracts of CDI Contractors, LLC (“CDI”), the Company’s general contracting construction company. Comparable store sales includes sales for those stores which were in operation for a full period in both the ~~current~~most recently completed quarter and the corresponding quarter for the prior fiscal year, including our internet store. Comparable store sales excludes changes in the allowance for sales returns. Non-comparable store sales includes: sales in the current fiscal year from stores opened during the previous fiscal year before they are considered comparable stores; sales from new stores opened during the current fiscal year; sales in the previous fiscal year for stores closed during the current or previous fiscal year that are no longer considered comparable stores; sales in clearance centers; and changes in the allowance for sales returns.

Sales occur as a result of interaction with customers across multiple points of contact, creating an interdependence between in-store and online sales. Online orders are fulfilled from both fulfillment centers and retail stores. Additionally, online customers have the ability to buy online and pick up in-store. Retail in-store customers have the ability to purchase items that may be ordered and fulfilled from either a fulfillment center or another retail store location. Online customers may return orders via mail, or customers may return orders placed online to retail store locations. Customers who earn reward points under the private label credit card program may earn and redeem rewards through in-store or online purchases.

Service charges and other income. Service charges and other income includes income generated through the long-term ~~private label card~~marketing and servicing alliance with Wells Fargo Bank, N.A. (“Wells Fargo Alliance”). Other income includes rental income, shipping and handling fees, gift card breakage and lease income on leased departments.

Cost of sales. Cost of sales includes the cost of merchandise sold (net of purchase discounts, non-specific margin maintenance allowances and merchandise margin maintenance allowances), bankcard fees, freight to the distribution centers, employee and promotional discounts, shipping to customers and direct payroll for salon personnel. Cost of sales also includes CDI contract costs, which comprise all direct material and labor costs, subcontract costs and those indirect costs related to contract performance, such as indirect labor, employee benefits and insurance program costs.

Selling, general and administrative expenses. Selling, general and administrative expenses include buying, occupancy, selling, distribution, warehousing, store and corporate expenses (including payroll and employee benefits), insurance, employment taxes, advertising, management information systems, legal and other corporate level expenses. Buying expenses consist of payroll, employee benefits and travel for design, buying and merchandising personnel.

Depreciation and amortization. Depreciation and amortization expenses include depreciation and amortization on property and equipment.

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Rentals. Rentals includes expenses for store leases, including contingent rent, ~~office space and~~ data processing and other equipment ~~rentals.~~rentals and office space leases.

Interest and debt expense, net. Interest and debt expense includes interest, net of interest income and capitalized interest, relating to the Company’s unsecured notes, subordinated debentures and borrowings under the Company’s credit ~~facility.~~agreement. Interest and debt expense also includes ~~gains and losses on note repurchases, if any,~~the amortization of financing costs and interest on finance lease ~~liabilities.~~obligations.

Other expense. Other expense includes the interest cost and net actuarial loss components of net periodic benefit costs related to the Company's unfunded, nonqualified defined benefit plan and charges related to the write-off of deferred financing fees, if any.

Gain on disposal of assets. Gain on disposal of assets includes the net gain or loss on the sale or disposal of property and equipment, as well as gains from insurance proceeds in excess of the cost basis of insured assets, if any.

LIBOR

~~The use of~~On March 5, 2021, the U.K. Financial Conduct Authority, which regulates LIBOR, ~~is expected~~announced that all LIBOR settings will either cease to be ~~phased out~~provided by any administrator or no longer be representative: (a) immediately after December 31, 2021, in the ~~end~~case of ~~2021. At this time, there is no definitive information regarding~~ the ~~future utilization~~1-week and 2-month U.S. dollar settings; and (b) immediately after June 30, 2023, in the case of ~~LIBOR beyond 2021 or of any particular replacement rate.~~the remaining U.S. dollar settings. Going forward, we intend to work with our lenders to use a suitable alternative reference rate for the 2021 amended credit agreement, the Wells Fargo Alliance and any other applicable agreements. We will continue to monitor, assess and plan for the phase out of LIBOR.

Seasonality

Our business, like many other retailers, is subject to seasonal influences, with a significant portion of sales and income typically realized during the last quarter of our fiscal year due to the holiday season. Because of the seasonality of our business, results from any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year.

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RESULTS OF OPERATIONS

The following table sets forth the results of operations as a percentage of net sales for the periods indicated (percentages may not foot due to rounding):

Three Months Ended
May 2,
2020 May 4,
2019
Net sales 100.0 % 100.0 %
Service charges and other income 4.4
2.2

104.4
102.2

Cost of sales 87.5
63.3
Selling, general and administrative expenses 36.9
27.6
Depreciation and amortization 6.5
3.6
Rentals 0.7
0.4
Interest and debt expense, net 1.6
0.8
Other expense 0.3
0.1
Gain on disposal of assets —
(0.5 )

(Loss) income before income taxes (29.0 ) 6.9
Income taxes (benefit) (8.4 ) 1.5

Net (loss) income (20.6 )% 5.4 %


	Three Months Ended
	May 1, 2021		May 2, 2020
Net sales	100.0	%	100.0	%
Service charges and other income	2.2		4.4

	102.2		104.4

Cost of sales	58.3		87.5
Selling, general and administrative expenses	25.3		36.9
Depreciation and amortization	3.5		6.5
Rentals	0.4		0.7
Interest and debt expense, net	0.9		1.6
Other expense	0.4		0.3
Gain on disposal of assets	(1.9)		—


Income (loss) before income taxes	15.3		(29.0)
Income taxes (benefit)	3.4		(8.4)


Net income (loss)	11.9	%	(20.6)	%

Net Sales

Three Months Ended
(in thousands of dollars) May 2,
2020 May 4,
2019 $ Change
Net sales:

Retail operations segment $ 751,027
$ 1,420,522
$ (669,495 )
Construction segment 35,628
44,919
(9,291 )
Total net sales $ 786,655
$ 1,465,441
$ (678,786 )


	Three Months Ended
(in thousands of dollars)	May 1, 2021		May 2, 2020		$ Change
Net sales:
Retail operations segment	$	1,296,736	$	751,027	$	545,709
Construction segment	31,807		35,628		(3,821)
Total net sales	$	1,328,543	$	786,655	$	541,888

The percent change in the Company’s sales by segment and product category for the three months ended May ~~2, 2020~~1, 2021 compared to the three months ended May ~~4, 2019~~2, 2020 as well as the sales percentage by segment and product category to total net sales for the three months ended May ~~2, 2020~~1, 2021 are as follows:



	% Change 2021 - 2020		% of Net Sales
Retail operations segment
Cosmetics	60.0	%	14	%
Ladies’ apparel	74.4		23
Ladies’ accessories and lingerie	81.2		15
Juniors’ and children’s apparel	84.5		11
Men’s apparel and accessories	81.9		17
Shoes	63.4		15
Home and furniture	47.0		3
			98
Construction segment	(10.7)		2
Total			100	%

% Change
2020 - 2019

% of
Net Sales
Retail operations segment

Cosmetics (40.2 )% 15 %
Ladies’ apparel (52.2 ) 22
Ladies’ accessories and lingerie (45.8 ) 14
Juniors’ and children’s apparel (50.3 ) 10
Men’s apparel and accessories (46.7 ) 16
Shoes (46.1 ) 15
Home and furniture (40.1 ) 3

95
Construction segment (20.7 ) 5
Total
100 %

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Net sales from the retail operations segment ~~decreased 47%~~increased $545.7 million, or approximately 73%, during the three months ended May ~~2, 2020~~1, 2021 compared to the three months ended May ~~4, 2019~~2, 2020, primarily due to the impact of the COVID-19 pandemic. The Company reported no comparable store sales data for the quarter due to the temporary closure of its brick-and-mortar stores as well as the interdependence between in-store and online ~~sales.~~sales during the three months ended May 2, 2020. Sales in all product categories ~~decreased~~increased significantly over the first quarter last year.

Compared to the first quarter of fiscal 2019, net sales from the retail operations segment for the three months ended May 1, 2021 and May 4, 2019 were $1,296.7 million and $1,420.5 million, respectively, decreasing $123.8 million or approximately 9%. Net sales in comparable stores for the three months ended May 1, 2021 and May 4, 2019 declined approximately 6%.

We recorded a return asset of ~~$8.2~~$12.4 million and ~~$11.9~~$8.2 million and an allowance for sales returns of ~~$12.4~~$23.1 million and ~~$20.1~~$12.4 million as of May ~~2, 2020~~1, 2021 and May ~~4, 2019,~~2, 2020, respectively.

During the three months ended May ~~2, 2020,~~1, 2021, net sales from the construction segment decreased ~~$9.3~~$3.8 million or ~~20.7%~~10.7% compared to the three months ended May ~~4, 2019~~2, 2020 due to a decrease in construction activity. The remaining performance obligations related to executed construction contracts totaled ~~$145.4~~$54.4 million as of May ~~2, 2020,~~1, 2021, decreasing approximately 7%29% from ~~February 1, 2020~~January 30, 2021 and ~~increasing~~decreasing approximately ~~18%~~63% from May ~~4, 2019,~~2, 2020, respectively. We expect ~~the backlog~~these remaining performance obligations to be earned over the next nine to eighteen months.

Service Charges and Other Income


	Three Months Ended				Three Months
(in thousands of dollars)	May 1, 2021		May 2, 2020			$ Change 2021 - 2020
Service charges and other income:
Retail operations segment
Income from Wells Fargo Alliance	$	17,707	$	20,800		$	(3,093)
Shipping and handling income	8,480		11,567			(3,087)
Leased department income	3		372			(369)
Other	2,424		1,748			676
	28,614		34,487			(5,873)
Construction segment	378		434			(56)
Total service charges and other income	$	28,992	$	34,921		$	(5,929)

Three Months Ended Three Months
(in thousands of dollars) May 2, 2020 May 4, 2019 $ Change 2020-2019
Service charges and other income:

Retail operations segment

Income from Wells Fargo Alliance $ 20,800
$ 21,146
$ (346 )
Shipping and handling income 11,567
6,077
5,490
Leased department income 372
1,123
(751 )
Other 1,748
3,350
(1,602 )
34,487
31,696
2,791
Construction segment 434
798
(364 )
Total service charges and other income $ 34,921
$ 32,494
$ 2,427

Service charges and other income is composed primarily of income from the Wells Fargo Alliance. Income from the alliance ~~remained relatively flat~~decreased $3.1 million during the three months ended May 1, 2021 compared to the three months ended May 2, 2020 primarily due to decreases in finance charges. Shipping and handling income decreased $3.1 million during the three months ended May 1, 2021 compared to the three months ended May ~~4, 2019. Shipping~~2, 2020 primarily due to an increase in online orders in 2020 as customer shopping patterns shifted to dillards.com as COVID-19 infection levels increased and brick-and-mortar stores were temporarily closed.

Compared to the first quarter of fiscal 2019, shipping and handling income ~~increased during~~for the three months ended May ~~2, 2020 compared to the three months ended~~1, 2021 and May 4, 2019 was $8.5 million and $6.1 million, respectively, increasing $2.4 million or 39.5%.

Leased department income consisted primarily ~~due~~of commissions from a principal licensed department of an upscale women's apparel vendor located in certain stores. By the end of July 2020, our agreement with this principal licensed department had been terminated. We expect future leased department income to ~~the increase in online orders and ship-from-store capabilities from closed store locations.~~be minimal.

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Gross Profit


(in thousands of dollars)	May 2, 2020		May 4, 2019		$ Change			% Change		(in thousands of dollars)	May 1, 2021		May 2, 2020		$ Change		% Change
Gross profit:										Gross profit:
Three months ended										Three months ended
Retail operations segment	$	96,034	$	536,371	$	(440,337	)	(82.1	)%	Retail operations segment	$	553,001	$	96,034	$	456,967	475.8	%
Construction segment	2,152		1,303		849			65.2		Construction segment	1,453		2,152		(699)		(32.5)
Total gross profit	$	98,186	$	537,674	$	(439,488	)	(81.7	)%	Total gross profit	$	554,454	$	98,186	$	456,268	464.7	%


	Three Months Ended					Three Months Ended
	May 2, 2020		May 4, 2019			May 1, 2021		May 2, 2020
Gross profit as a percentage of segment net sales:					Gross profit as a percentage of segment net sales:
Retail operations segment	12.8	%	37.8	%	Retail operations segment	42.6	%	12.8	%
Construction segment	6.0		2.9		Construction segment	4.6		6.0
Total gross profit as a percentage of net sales	12.5		36.7		Total gross profit as a percentage of net sales	41.7		12.5

Gross profit, as a percentage of sales, ~~decreased~~increased to 41.7% from 12.5% ~~from 36.7%~~ during the three months ended May 1, 2021 compared to the three months ended May 2, 2020, ~~compared to the three months ended May 4, 2019.~~respectively.

Gross profit from retail operations, as a percentage of sales, ~~decreased~~increased to 42.6% from 12.8% ~~from 37.8%~~ during the three months ended May 1, 2021 compared to the three months ended May 2, 2020, respectively, primarily due to increased markdowns taken during the first quarter of fiscal 2020 as a result of the impact of the COVID-19 pandemic as well as better inventory management and customer demand leading to decreased markdowns in the first quarter of fiscal 2021. Gross margin increased significantly in all product categories except cosmetics which increased moderately.

Compared to the first quarter of fiscal 2019, gross profit from retail operations, as a percentage of sales, increased 489 basis points of sales to 42.6% during the three months ended May 1, 2021 compared to 37.8% during the three months ended May 4, 2019 primarily due to ~~increased~~better inventory management and customer demand leading to decreased markdowns ~~taken as a result~~in the first quarter of ~~the impact of the COVID-19 pandemic. Gross margin decreased significantly in all product categories except cosmetics which declined moderately.~~fiscal 2021.

Gross profit from the construction segment ~~increased 314~~decreased 147 basis points of construction sales for the three months ended May ~~2, 2020~~1, 2021 compared to the three months ended May ~~4, 2019, respectively.~~2, 2020.

Inventory decreased ~~14%~~17% in total as of May ~~2, 2020~~1, 2021 compared to May ~~4, 2019.~~2, 2020. A 1% change in the dollar amount of markdowns would have impacted ~~the~~ net ~~loss~~income by approximately $2 million for the three months ended May ~~2, 2020.~~1, 2021.

Selling, General and Administrative Expenses (“SG&A”)



(in thousands of dollars)	May 1, 2021		May 2, 2020		$ Change		% Change
SG&A:
Three months ended
Retail operations segment	$	335,143	$	288,557	$	46,586	16.1	%
Construction segment	1,471		1,889		(418)		(22.1)
Total SG&A	$	336,614	$	290,446	$	46,168	15.9	%

(in thousands of dollars) May 2, 2020 May 4, 2019 $ Change % Change
SG&A:

Three months ended

Retail operations segment $ 288,557
$ 403,292
$ (114,735 ) (28.4 )%
Construction segment 1,889
1,868
21
1.1
Total SG&A $ 290,446
$ 405,160
$ (114,714 ) (28.3 )%


	Three Months Ended
	May 1, 2021		May 2, 2020
SG&A as a percentage of segment net sales:
Retail operations segment	25.8	%	38.4	%
Construction segment	4.6		5.3
Total SG&A as a percentage of net sales	25.3		36.9

Three Months Ended
May 2, 2020 May 4, 2019
SG&A as a percentage of segment net sales:

Retail operations segment 38.4 % 28.4 %
Construction segment 5.3
4.2
Total SG&A as a percentage of net sales 36.9
27.6

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SG&A decreased ~~by $114.7 million and increased as a percentage~~to 25.3% of ~~net~~ sales ~~to 36.9% from 27.6%~~ during the three months ended May ~~2, 2020~~1, 2021 compared to ~~the three months ended May 4, 2019. SG&A from retail operations increased to 38.4% from 28.4%~~36.9% of ~~net~~ sales during the three months ended May 2, 2020, ~~compared~~while increasing $46.2 million. SG&A from retail operations decreased to 25.8% of sales for the three months ended May ~~4, 2019.~~1, 2021 compared to 38.4% of sales for the three months ended May 2, 2020, while increasing $46.6 million. The ~~decrease~~increase in SG&A dollars was primarily ~~attributable~~due to ~~decreases~~increases in payroll ~~expense. The~~expense and related payroll taxes.

Payroll expense and related payroll taxes for the three months ended May 1, 2021 was $225.4 million compared to $183.8 million for the three months ended May 2, 2020, increasing $41.5 million. During the first quarter of fiscal 2020, the Company (a) furloughed store associates as stores temporarily closed due to the COVID-19 ~~pandemic. Additionally, furlough actions were implemented~~pandemic and furloughed associates in certain corporate and support facility ~~functions. At the peak of store closures, approximately 90% of Dillard's 38,000 associates were furloughed. The Company was able to reduce~~functions and (b) reduced payroll expense by $4.2 million through the employee retention credit available under the CARES Act.

Compared to the first quarter of fiscal 2019, SG&A from retail operations for the three months ended May 1, 2021 and May 4, 2019 were $335.1 million (25.8% of sales) and $403.3 million (28.4% of sales), decreasing $68.1 million primarily due to decreases in payroll expense and related payroll taxes. During the first quarter of fiscal 2021, stores were operating at reduced operating hours from the first quarter of fiscal 2019, requiring fewer sales associates.

Depreciation and Amortization



(in thousands of dollars)	May 1, 2021		May 2, 2020		$ Change		% Change
Depreciation and amortization:
Three months ended
Retail operations segment	$	46,338	$	50,732	$	(4,394)	(8.7)	%
Construction segment	70		169		(99)		(58.6)
Total depreciation and amortization	$	46,408	$	50,901	$	(4,493)	(8.8)	%

(in thousands of dollars) May 2, 2020 May 4, 2019 $ Change % Change
Depreciation and amortization:

Three months ended

Retail operations segment $ 50,732
$ 52,194
$ (1,462 ) (2.8 )%
Construction segment 169
170
(1 ) (0.6 )
Total depreciation and amortization $ 50,901
$ 52,364
$ (1,463 ) (2.8 )%

Depreciation and amortization expense decreased $4.5 million during the three months ended May 1, 2021 compared to the three months ended May 2, 2020 primarily due to the timing and composition of capital expenditures.

Interest and Debt Expense, Net


(in thousands of dollars)	May 2, 2020			May 4, 2019			$ Change		% Change		(in thousands of dollars)	May 1, 2021		May 2, 2020		$ Change		% Change
Interest and debt expense (income), net:											Interest and debt expense (income), net:
Three months ended											Three months ended
Retail operations segment	$	12,291		$	11,264		$	1,027	9.1	%	Retail operations segment	$	11,550	$	12,291	$	(741)	(6.0)	%
Construction segment	(21		)	(27		)	6		22.2		Construction segment	(15)		(21)		6		28.6
Total interest and debt expense, net	$	12,270		$	11,237		$	1,033	9.2	%	Total interest and debt expense, net	$	11,535	$	12,270	$	(735)	(6.0)	%

Net interest and debt expense ~~increased $1.0~~decreased $0.7 million and total weighted average debt ~~increased~~decreased by ~~$237.9~~$265.4 million during the three months ended May ~~2, 2020~~1, 2021 compared to the three months ended May ~~4, 2019~~2, 2020 primarily due to ~~an increase in~~a decrease of short term borrowings under the credit facility. ~~The Company borrowed $779~~

Other Expense




(in thousands of dollars)	May 1, 2021		May 2, 2020		$ Change		% Change
Other expense:
Three months ended
Retail operations segment	$	4,964	$	2,104	$	2,860	135.9	%
Construction segment	—		—		—		—
Total other expense	$	4,964	$	2,104	$	2,860	135.9	%

Other expense increased $2.9 million ~~under~~during the ~~credit facility on March 25,~~three months ended May 1, 2021 compared to the three months ended May 2, 2020 ~~and repaid~~primarily due to the ~~full amount on April 30, 2020 concurrent~~write-off of certain deferred financing fees in connection with the ~~execution~~amendment and extension of the ~~amended~~Company's secured revolving credit ~~agreement.~~facility.

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Gain on Disposal of Assets




(in thousands of dollars)	May 1, 2021		May 2, 2020		$ Change
Gain on disposal of assets:
Three months ended
Retail operations segment	$	(24,673)	$	(18)	$	(24,655)
Construction segment	—		(1)		1
Total gain on disposal of assets	$	(24,673)	$	(19)	$	(24,654)

(in thousands of dollars) May 2, 2020 May 4, 2019 $ Change
Gain on disposal of assets:

Three months ended

Retail operations segment $ (18 ) $ (7,400 ) $ 7,382
Construction segment (1 ) —
(1 )
Total gain on disposal of assets $ (19 ) $ (7,400 ) $ 7,381

During the three months ended May ~~4, 2019,~~1, 2021, the Company ~~received~~recorded proceeds of ~~$13.4~~$29.3 million primarily from the sale of ~~two~~three store properties, resulting in a gain of ~~$7.4 million.~~$24.7 million that was recorded in gain on disposal of assets.

Income Taxes

The Company’s estimated federal and state effective income tax rate was approximately 22.2% and 29.0% for the three months ended May 1, 2021 and May 2, 2020, respectively. During the three months ended May 1, 2021, income tax expense differed from what would be computed using the statutory federal income tax rate primarily due to the effects of state and local income taxes and federal tax credits.

The Company ~~expects to be~~was in a net operating loss position for the fiscal ~~year.~~year ended January 30, 2021. The ~~CARES~~Coronavirus Aid, Relief and Economic Security (“CARES”) Act, signed into law on March 27, 2020, allows for net operating loss carryback to years in which the statutory federal ~~tax rate was 35%. The Company’s estimated federal and state effective~~ income tax rate was ~~approximately 29.0% and 22.0% for~~35% rather than the ~~three months ended May 2, 2020 and May 4, 2019, respectively.~~current 21%. During the three months ended May 2, 2020, income tax benefit differed from what would be computed using the current statutory federal income tax rate of 21% primarily due to the recognition of a net tax benefit of $14.8 million related to the rate differential in the carryback provision of the CARES Act. This net tax benefit was comprised of tax expense of $25.2 million for the remeasurement of beginning deferred tax assets and liabilities and tax benefit of $40.0 million for the impact of the net operating loss carryback.year. Income tax benefit for the quarter also included the effects of ~~federal tax credits and~~ state and local income ~~taxes.~~

~~During the three months ended May 4, 2019, income tax expense differed from what would be computed using the statutory~~taxes and federal tax ~~rate primarily due to~~credits.

The Company expects the ~~effects of federal tax credits and state and local income taxes.~~

~~Due to uncertainty relating to the impacts of COVID-19 on the Company’s business operations, the Company is not providing an expected~~ fiscal ~~2020~~2021 federal and state effective income tax ~~rate.~~rate to approximate 22% to 23%. This rate may change if results of operations for fiscal 2021 differ from management’s current expectations. Changes in the Company’s assumptions and judgments can materially affect amounts recognized in the condensed consolidated financial statements.

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FINANCIAL CONDITION

A summary of net cash flows for the three months ended May 1, 2021 and May 2, 2020 ~~and~~ ~~May 4, 2019~~ follows:


	Three Months Ended										Three Months Ended
(in thousands of dollars)	May 2, 2020			May 4, 2019			$ Change			(in thousands of dollars)	May 1, 2021		May 2, 2020		$ Change
Operating Activities	$	(111,125	)	$	48,357		$	(159,482	)	Operating Activities	$	302,413	$	(111,125)	$	413,538
Investing Activities	(19,904		)	(5,087		)	(14,817		)	Investing Activities	14,183		(19,904)		34,087
Financing Activities	(76,054		)	(18,294		)	(57,760		)	Financing Activities	(61,015)		(76,054)		15,039
Total (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash	$	(207,083	)	$	24,976		$	(232,059	)
Total Increase (Decrease) in Cash and Cash Equivalents										Total Increase (Decrease) in Cash and Cash Equivalents	$	255,581	$	(207,083)	$	462,664

Net cash flows from operations ~~decreased $159.5~~increased $413.5 million during the three months ended May ~~2, 2020~~1, 2021 compared to the three months ended May ~~4, 2019 primarily~~2, 2020 due to significant ~~decreases~~increases in net income, primarily due to ~~decreases~~increases in ~~sales, partially offset by~~gross profit and changes in working capital.

~~The Company took a number of actions~~ Compared to ~~enhance liquidity during~~ the first quarter asof fiscal 2019, net cash flows from operations for the ~~COVID-19 pandemic progressed, including the following:~~three months ended May 1, 2021 and May 4, 2019 were $302.4 million and $48.4 million, respectively, increasing $254.0 million.

Wells Fargo owns and manages the Dillard's private label cards under the Wells Fargo Alliance. Under the Wells Fargo Alliance, Wells Fargo establishes and owns private label card accounts for our customers, retains the benefits and risks associated with the ownership of the accounts, provides key customer service functions, including new account openings, transaction authorization, billing adjustments and customer inquiries, receives the finance charge income and incurs the bad debts associated with those accounts.

Pursuant to the Wells Fargo Alliance, we receive ~~on-going~~ongoing cash compensation from Wells Fargo based upon the portfolio's earnings. The compensation received from the portfolio is determined monthly and has no recourse provisions. The amount the Company receives is dependent on the level of sales on Wells Fargo accounts, the level of balances carried on Wells Fargo accounts by Wells Fargo customers, payment rates on Wells Fargo accounts, finance charge rates and other fees on Wells Fargo accounts, the level of credit losses for the Wells Fargo accounts as well as Wells Fargo's ability to extend credit to our customers. We participate in the marketing of the private label cards, which includes the cost of customer reward programs. The Wells Fargo Alliance expires in fiscal 2024.

The Company received income of ~~$20.8~~$17.7 million and ~~$21.1~~$20.8 million from the Wells Fargo Alliance during the three months ended May ~~2, 2020~~1, 2021 and May ~~4, 2019,~~2, 2020, respectively. The Company ~~is unable to quantify~~cannot reasonably predict whether there will be any ongoing impact or the magnitude of any such impact of the COVID-19 pandemic on the portfolio's future earnings and the ~~on-going~~ongoing cash compensation from the Wells Fargo Alliance.

During the three months ended May 1, 2021, the Company received proceeds from insurance of $1.8 million for claims filed for merchandise losses related to storm damage incurred at two stores.

Capital expenditures were ~~$20.2~~$16.9 million and ~~$18.7~~$20.2 million for the three months ended May ~~2, 2020~~1, 2021 and May ~~4, 2019,~~2, 2020, respectively. The capital expenditures were primarily related to equipment purchases and the ~~remodeling~~continued construction of ~~existing~~two new stores during the current year. The Company has announced plans to open a new store at Mesa Mall in Grand Junction, Colorado during the Fall of 2021 (105,000 square feet). The Company has also announced plans to open a new store at University Place in Orem, Utah in the Spring of 2022 (160,000 square feet). Both opportunities arose from peer closures at those centers.

During the three months ended May ~~4, 2019,~~1, 2021, the Company received cash proceeds of ~~$13.4~~$29.3 million and recorded a related gain of ~~$7.4~~$24.7 million, ~~for~~primarily from the sale of ~~two~~three store locations in Boardman, Ohio and Boynton Beach, Florida. The proceeds from the Boardman, Ohio store were held in escrow for the acquisition of replacement property under like-kind exchange agreements. The escrow accounts were administered by an intermediary. Pursuant to the like-kind exchange agreements, the cash was restricted forproperties: (1) a maximum of 180 days from the date of the property sale pending the acquisition of replacement property. As of May 4, 2019, the acquisition of replacement property had not yet occurred; therefore, the proceeds were classified as restricted cash on the condensed consolidated balance sheets.

~~During the first quarter of 2020, the Company opened an 85,000~~120,000 square foot ~~expansion~~location at ~~Columbia~~Cortana Mall in ~~Columbia, Missouri (dual-anchor location totaling 185,000 square feet). During the second quarter of 2020, the Company plans to replace~~Baton Rouge, Louisiana, which was permanently closed and sold; (2) a ~~100,000~~200,000 square foot ~~leased facility~~location at ~~Richland Fashion~~Paradise Valley Mall in ~~Waco, Texas with a 125,000 square foot owned facility (dual-anchor location totaling 190,000 square feet).~~

~~The Company has announced upcoming store closures at Central Mall in Lawton, Oklahoma (100,000 square feet); Crossroads Center in Waterloo, Iowa (150,000 square feet);~~Phoenix, Arizona, which was sold and ~~North Plains Mall in Clovis, New Mexico (62,000 square feet). The Company expects~~is expected to close ~~the locations~~ during ~~the~~our second fiscal quarter and (3) a non-operating store property in Knoxville, Tennessee. There were no material costs associated with any of ~~2020 with minimal closing costs.~~these store closures. We remain committed to closing under-performing stores where appropriate and may incur future closing costs related to such stores when they close.

During the three months ended May 1, 2021, the Company received proceeds from insurance of $1.8 million for claims filed for building losses related to storm damage incurred at two stores.

The Company had cash on hand of ~~$70.0~~$615.9 million as of May ~~2, 2020. As~~1, 2021. During the first quarter of fiscal 2020 and as part of our overall liquidity management strategy and for peak working capital requirements, the Company maintained an unsecured

As part of the Company's liquidity strategy during the COVID-19 pandemic, in March 2020, the Company borrowed $779 million under the credit agreement.

The credit agreement ~~which~~ was amended in April 2020 and became secured by certain deposit accounts of the Company and certain inventory of certain subsidiaries (the "2020 amended credit agreement"). The borrowings of $779 million were repaid concurrent with the execution of the 2020 amended credit agreement. AtDuring the three months ended May 2, 2020, the Company paid $2.9 million in issuance costs related to the 2020 amended credit agreement, which were recorded in other assets on the condensed consolidated balance sheet.

In April 2021, the Company further amended its secured credit agreement (the “2021 amended credit agreement”). See Note 7, Revolving Credit Agreement, in the "Notes to Condensed Consolidated Financial Statements," in Part I, Item I hereof for additional information. During the three months ended May 1, 2021, the Company paid $2.7 million in issuance costs related to the 2021 amended credit agreement, which were recorded in other assets on the condensed consolidated balance sheet, and the Company recognized a loss on the early extinguishment of debt of $2.8 million for the write-off of certain remaining deferred financing fees related to the previous amended secured credit agreement. This charge was recorded in other expense on the condensed consolidated statement of operations.

At May 1, 2021, no borrowings were outstanding, and letters of credit totaling ~~$21.0~~$20.1 million were issued under the 2021 amended credit agreement leaving unutilized availability under the credit facility of ~~$779.0~~$779.9 million.

During the three months ended May 1, 2021, the Company repurchased 0.6 million shares of Class A Common Stock at an average price of $94.12 per share for $58.8 million (including the accrual of $4.0 million of share repurchases that had not settled as of May 1, 2021) under the Company's March 2018 Plan. During the three months ended May 2, 2020, the Company repurchased 1.0 million shares of Class A Common Stock at an average price of $61.91 per share for $61.8 million under the Company's March 2018 Plan. Additionally, the Company paid $7.3 million for share repurchases that had not yet settled but were accrued at February 1, 2020. During the three months ended May 4, 2019, the Company repurchased 0.2 million shares of Class A Common Stock at an average price of $70.85 per share for $17.4 million (including the accrual of $2.0 million of share repurchases that had not settled as of May 4, 2019) under the Company's March 2018 Plan. At May ~~2, 2020, $206.9~~1, 2021, $114.3 million of authorization remained under the March 2018 Plan. The ultimate disposition of the repurchased stock has not been determined. See Note 8, Stock Repurchase Programs, in the "Notes to Condensed Consolidated Financial Statements," in Part I, Item I hereof for additional information.

The COVID-19 pandemic has had and may continue to have a significant ~~negative effect~~impact on the Company's ~~liquidity~~business, results of operations and ~~net sales. Due to heightened~~financial position. Because there is still significant uncertainty ~~relating to~~around the ~~impacts~~effects of the COVID-19 pandemic on the ~~Company’s~~Company's business operations, ~~including the duration~~our profitability and ~~impact on overall customer demand, our~~ liquidity ~~and net sales~~ may be further impacted if we are unable to appropriately manage our inventory levels and ~~expenses.~~expenses relative to any change in consumer demand.

The Company expects to finance its operations during fiscal ~~2020~~2021 from cash on hand, cash flows generated from operations and utilization of the credit facility. Depending upon our actual and anticipated sources and uses of liquidity, the Company will from time to time consider other possible financing transactions, the proceeds of which could be used to fund working capital or for other corporate purposes.

There have been no material changes in the information set forth under caption ~~“Contractual Obligations and Commercial~~“Commercial Commitments” in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in the Company’s Annual Report on Form 10-K for the fiscal year ended ~~February 1, 2020.~~January 30, 2021.

The Company has not created, and is not party to, any special-purpose entities or off-balance-sheet arrangements for the purpose of raising capital, incurring debt or operating the Company’s business. The Company does not have any off-balance-sheet arrangements or relationships that are reasonably likely to materially affect the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or the availability of capital resources.

For information with respect to new accounting pronouncements and the impact of these pronouncements on our consolidated financial statements, see Note 2, Accounting Standards, in the "Notes to Condensed Consolidated Financial Statements," in Part I, Item I hereof.

This report contains certain forward-looking statements. The following are or may constitute forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995: (a) statements including words such as “may,” “will,” “could,” “should,” “believe,” “expect,” “future,” “potential,” “anticipate,” “intend,” “plan,” “estimate,” “continue,” or the negative or other variations thereof; (b) statements regarding matters that are not historical facts; and (c) statements about the Company’s future occurrences, plans and objectives, including statements regarding management’s expectations and forecasts for the remainder of fiscal ~~2020~~2021 and beyond, statements concerning the opening of new stores or the closing of existing stores, statements concerning capital expenditures and sources of liquidity, statements regarding the expected impact of the COVID-19 pandemic and related government responses, including the CARES Act and other subsequently-enacted COVID-19 stimulus packages, statements concerning share repurchases, statements concerning pension contributions, statements regarding the expected phase out of LIBOR and statements concerning estimated taxes. The Company cautions that forward-looking statements contained in this report are based on estimates, projections, beliefs and assumptions of management and information available to management at the time of such statements and are not guarantees of future performance. The Company disclaims any obligation to update or revise any forward-looking statements based on the occurrence of future events, the receipt of new information, or otherwise. Forward-looking statements of the Company involve risks and uncertainties and are subject to change based on various important factors. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements made by the Company and its management as a result of a number of risks, uncertainties and assumptions. Representative examples of those factors include (without limitation) the COVID-19 pandemic and its effects on public health, our supply chain, the health and well-being of our employees and customers, and the retail industry in general; other general retail industry conditions and macro-economic conditions; economic and weather conditions for regions in which the Company’s stores are located and the effect of these factors on the buying patterns of the Company’s customers, including the effect of changes in prices and availability of oil and natural gas; the availability of consumer credit; the impact of competitive pressures in the department store industry and other retail channels including specialty, off-price, discount and Internet retailers; changes in consumer spending patterns, debt levels and their ability to meet credit obligations; changes in tax legislation; changes in legislation, affecting such matters as the cost of employee benefits or credit card income; adequate and stable availability and pricing of materials, production facilities and labor from which the Company sources its merchandise; changes in operating expenses, including employee wages, commission structures and related benefits; system failures or data security breaches; possible future acquisitions of store properties from other department store operators; the continued availability of financing in amounts and at the terms necessary to support the Company’s future business; fluctuations in LIBOR and other base borrowing rates; the elimination of LIBOR; potential disruption from terrorist activity and the effect on ongoing consumer confidence; other epidemic, pandemic or public health issues; potential disruption of international trade and supply chain efficiencies; any government-ordered restrictions on the movement of the general public or the mandated or voluntary closing of retail stores in response to the COVID-19 pandemic; world conflict and the possible impact on consumer spending patterns and other economic and demographic changes of similar or dissimilar nature.The Company's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended ~~February 1, 2020,~~January 30, 2021, contain other information on factors that may affect financial results or cause actual results to differ materially from forward-looking statements.

Item 3. Quantitative and Qualitative Disclosures About Market ~~Risk~~Risk.

There have been no material changes in the information set forth under caption “Item 7A-Quantitative and Qualitative Disclosures About Market Risk” in the Company’s Annual Report on Form 10-K for the fiscal year ended ~~February 1, 2020.~~January 30, 2021.

Item 4. Controls and ~~Procedures~~Procedures.

The Company has established and maintains disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934). The Company’s management, with the participation of our Principal Executive Officer and Co-Principal Financial Officers, has evaluated the effectiveness of the Company’s disclosure controls and procedures as of the end of the fiscal quarter covered by this quarterly report, and based on that evaluation, the Company’s Principal Executive Officer and Co-Principal Financial Officers have concluded that these disclosure controls and procedures were effective.

There were no changes in our internal control over financial reporting that occurred during the fiscal quarter ended May ~~2, 2020~~1, 2021 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Item 1. Legal ~~Proceedings~~Proceedings.

From time to time, the Company is involved in litigation relating to claims arising out of the Company’s operations in the normal course of business. This may include litigation with customers, employment related lawsuits, class action lawsuits, purported class action lawsuits and actions brought by governmental authorities. As of June ~~5, 2020,~~9, 2021, the Company is not a party to any legal proceedings that, individually or in the aggregate, are reasonably expected to have a material adverse effect on the Company’s business, results of operations, financial condition or cash flows.

Item 1A. Risk ~~Factors~~Factors.

~~"Item 1A, Risk Factors"~~There have been no material changes in ~~our~~the information set forth under caption “Item 1A-Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended ~~February 1, 2020, as filed with the Securities Exchange Commission on March 31, 2020 includes a discussion~~January 30, 2021.

Table of our risk factors. The information presented below updates, and should be read in conjunction with, the risk factors disclosed in our Annual Report on Form 10-K. The effects of the events and circumstances described in the following risk factor may have the additional effect of heightening many of the risks noted in our Annual Report on Form 10-K. Otherwise, except as presented below, there have been no material changes to the risk factors disclosed in the “Risk Factors” section of our Annual Report on Form 10-K for the year ended February 1, 2020, as filed with the Securities Exchange Commission on March 31, 2020.Contents

The COVID-19 pandemic and its effects on public health, our supply chain, the health and well-being of our employees and customers, and the retail industry in general, has had, and could continue to have, a material adverse effect on our business, financial condition and results of operations.

In December 2019, a strain of coronavirus, now known as COVID-19, was reported to have surfaced in Wuhan, China. Since that time, the virus has rapidly spread to other countries around the world, including the United States. In response to the pandemic, national and local governments, including those in the regions in which we operate, have taken various measures to attempt to slow the spread of the virus, including travel bans; prohibitions on group events and large gatherings; extended shutdowns of schools, government offices and certain businesses; curfews and recommendations to practice “social distancing.” Accordingly, the Company began closing its stores on March 19, 2020, and all 285 store locations were temporarily closed by April 9, 2020.

The Company has reopened all stores as of June 2, 2020. Stores are operating at reduced hours and implementing certain safety measures to ensure the safety of our customers and associates, which may have the effect of discouraging shopping or limiting the occupancy of our stores. These measures, and any additional measures that have been and may continue to be taken in response to the COVID-19 pandemic, have substantially decreased and may continue to decrease, the number of customers that visit our stores and the shopping malls in which our stores are located, which has had, and will likely continue to have a material adverse effect on our business, financial condition and results of operations. At this time, it is unclear how long these measures may remain in place, what additional measures may be imposed, or when our operations will be restored to the levels that existed prior to the COVID-19 pandemic.

In addition, our business depends on consumer discretionary spending, and as such, our results are particularly sensitive to economic conditions and consumer confidence. COVID-19 has significantly impacted economic conditions, resulting in, among other things, unprecedented increases in the number of people seeking jobless benefits and a significant decline in global financial markets. As a result, even when all of our store locations are fully operational, there can be no guarantee that our revenue will return to its pre-COVID-19 levels.

The Company sources a significant portion of its private label and exclusive brand merchandise from countries that have experienced widespread transmission of the virus, including China. Additionally, many of the Company’s branded merchandise vendors may also source a significant portion of their merchandise from these same countries. Manufacturing capacity in those countries has been materially impacted by the pandemic, which has negatively impacted our supply chain. If this continues, we cannot guarantee that we will be able to locate alternative sources of supply for our merchandise on acceptable terms, or at all. If we are unable to adequately source our merchandise or purchase appropriate amounts of merchandise from branded vendors, our business and results of operations may be materially and adversely affected.

Additionally, in the event that the Company were to experience widespread transmission of the virus at one or more of the Company’s stores or other facilities, the Company could suffer reputational harm or other potential liability. Further, the Company’s business operations may be materially and adversely affected if a significant number of the Company’s employees are impacted by the virus

Item 2. Unregistered Sales of Equity Securities and Use of ~~Proceeds~~Proceeds.

(a) Unregistered Sales of Equity Securities

On February 11, 2021, the Company issued 12,000 shares of Class A Common Stock in exchange for 12,000 shares of Class B Common Stock tendered for conversion pursuant to the Certificate of Incorporation. The transaction was exempt from registration under Section 3(a)(9) of the Securities Act of 1933.


Issuer Purchases of Equity Securities
Period	(a) Total Number of Shares Purchased	(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs



January 31, 2021 through February 27, 2021	24,174	$	82.73	24,174	$	171,124,701
February 28, 2021 through April 3, 2021	204,553	89.13		204,553	152,892,994
April 4, 2021 through May 1, 2021	396,166	97.39		396,166	114,311,132
Total	624,893	$	94.12	624,893	$	114,311,132

Issuer Purchases of Equity Securities
Period (a) Total Number of Shares Purchased
(b) Average Price Paid per Share
(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
(d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
February 2, 2020 through February 29, 2020 819,099
$ 64.50
819,099
$ 215,851,601
March 1, 2020 through April 4, 2020 179,643
50.10
179,643
206,852,235
April 5, 2020 through May 2, 2020 —
—
—
206,852,235
Total 998,742
$ 61.91
998,742
$ 206,852,235

In March 2018, the Company's Board of Directors authorized the repurchase of up to $500 million of the Company's Class A Common Stock under an open-ended stock repurchase plan ("March 2018 Plan"). This repurchase plan permits the Company to repurchase its Class A Common Stock in the open market, pursuant to preset trading plans meeting the requirements of Rule 10b5-1 under the Securities Exchange Act of 1934 or through privately negotiated transactions. ~~The March 2018 Plan~~This repurchase plan has no expiration date.

During the three months ended May ~~2, 2020,~~1, 2021, the Company repurchased ~~1.0~~0.6 million shares totaling ~~$61.8~~$58.8 million. As of May ~~2, 2020, $206.9~~1, 2021, $114.3 million of authorization remained under the March 2018 Plan.

On May 15, 2021, the Company announced that its Board of Directors approved a new open-ended stock repurchase program authorizing the Company to repurchase up to $500 million of its Class A Common Stock. The Company intends to exhaust the remaining authorization under the March 2018 Plan before repurchasing any shares under the new repurchase program. Reference is made to the discussion in Note 8, Stock Repurchase ~~Program~~Programs, in the “Notes to Condensed Consolidated Financial Statements” in Part I of this Quarterly Report on Form 10-Q, which information is incorporated by reference herein.

Table of Contents

Item 6. ~~Exhibits~~Exhibits.


Number		Description


~~Number~~	~~Description~~

10.1	Amendment No. 23 to Credit Agreement between Dillard's, Inc., ~~Dillard's~~Dillard Store Services, Inc. and JPMorgan Chase Bank, N.A. as agent for a syndicate of lenders, ~~(incorporated by reference to Exhibit~~dated April 28, 2021 (Exhibit 10.1 to ~~the Company's Current Report on~~ Form 8-K ~~filed with the SEC on~~dated May ~~4, 2020)~~3, 2021).

31.1		Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of Co-Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.3		Certification of Co-Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).

32.2		Certification of Co-Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).

32.3		Certification of Co-Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).

101.INS		XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the ~~Registrant~~registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



		DILLARD’S, INC.
		(Registrant)


Date:	June ~~5, 2020~~9, 2021	/s/ Phillip R. Watts
		Phillip R. Watts
		Senior Vice President, Co-Principal Financial Officer and Principal Accounting Officer

		/s/ Chris B. Johnson
		Chris B. Johnson
		Senior Vice President and Co-Principal Financial Officer



	May 2, 2020			February 1, 2020			May 4, 2019
Assets
Current assets:
Cash and cash equivalents	$	69,994		$	277,077		$	139,802
Restricted cash	—			—			8,683
Accounts receivable	44,964			46,160			47,863
Merchandise inventories	1,570,313			1,465,007			1,832,581
Federal and state income taxes	39,176			—			—
Other current assets	55,223			59,838			66,015

Total current assets	1,779,670			1,848,082			2,094,944

Property and equipment (net of accumulated depreciation and amortization of $2,385,686, $2,336,728 and $2,259,145 respectively)	1,434,601			1,458,176			1,551,844
Operating lease assets	47,852			47,924			52,782
Deferred income taxes	4,908			—			—
Other assets	75,314			76,075			79,418

Total assets	$	3,342,345		$	3,430,257		$	3,778,988

Liabilities and stockholders’ equity
Current liabilities:
Trade accounts payable and accrued expenses	$	1,055,891		$	892,789		$	1,134,258
Current portion of finance lease liabilities	1,109			1,219			1,022
Current portion of operating lease liabilities	14,880			14,654			15,105
Federal and state income taxes	—			22,158			28,961

Total current liabilities	1,071,880			930,820			1,179,346

Long-term debt	365,743			365,709			365,603
Finance lease liabilities	528			695			1,636
Operating lease liabilities	33,353			32,683			36,934
Other liabilities	274,435			273,601			240,971
Deferred income taxes	—			3,490			17,590
Subordinated debentures	200,000			200,000			200,000
Commitments and contingencies
Stockholders’ equity:
Common stock	1,239			1,239			1,239
Additional paid-in capital	951,726			951,726			948,835
Accumulated other comprehensive loss	(30,628		)	(31,059		)	(12,809		)
Retained earnings	4,391,039			4,556,494			4,533,973
Less treasury stock, at cost	(3,916,970		)	(3,855,141		)	(3,734,330		)

Total stockholders’ equity	1,396,406			1,623,259			1,736,908

Total liabilities and stockholders’ equity	$	3,342,345		$	3,430,257		$	3,778,988



	Three Months Ended May 4, 2019
					Accumulated Other Comprehensive Loss
	Common Stock		Additional Paid-in Capital					Retained Earnings			Treasury Stock
	Common Stock		Additional Paid-in Capital					Retained Earnings			Treasury Stock			Total
Balance, February 2, 2019	$	1,239	$	948,835	$	(12,809	)	$	4,458,006		$	(3,716,890	)	$	1,678,381
Net income	—		—		—			78,602			—			78,602
Purchase of 246,158 shares of treasury stock	—		—		—			—			(17,440		)	(17,440		)
Cash dividends declared:
Common stock, $0.10 per share	—		—		—			(2,635		)	—			(2,635		)
Balance, May 4, 2019	$	1,239	$	948,835	$	(12,809	)	$	4,533,973		$	(3,734,330	)	$	1,736,908



(in thousands of dollars)	Retail Operations			Construction			Consolidated
Three Months Ended May 2, 2020:
Net sales from external customers	$	751,027		$	35,628		$	786,655
Gross profit	96,034			2,152			98,186
Depreciation and amortization	50,732			169			50,901
Interest and debt expense (income), net	12,291			(21		)	12,270
(Loss) income before income taxes	(228,667		)	522			(228,145		)
Total assets	3,299,363			42,982			3,342,345

Three Months Ended May 4, 2019:
Net sales from external customers	$	1,420,522		$	44,919		$	1,465,441
Gross profit	536,371			1,303			537,674
Depreciation and amortization	52,194			170			52,364
Interest and debt expense (income), net	11,264			(27		)	11,237
Income before income taxes	100,728			44			100,772
Total assets	3,731,040			47,948			3,778,988



	% Change 2020 - 2019		% of Net Sales
Retail operations segment
Cosmetics	(40.2	)%	15	%
Ladies’ apparel	(52.2	)	22
Ladies’ accessories and lingerie	(45.8	)	14
Juniors’ and children’s apparel	(50.3	)	10
Men’s apparel and accessories	(46.7	)	16
Shoes	(46.1	)	15
Home and furniture	(40.1	)	3
			95
Construction segment	(20.7	)	5
Total			100	%


▪	~~Canceled, suspended and significantly delayed merchandise shipments~~


▪	~~Reduced merchandise purchases during the quarter by 33%~~


▪	~~Reviewed and reduced discretionary operating and capital expenditures~~


▪	~~Executed aggressive promotional markdowns to clear inventory~~