The Cato Corporation (CATO) has reported a 38.02 percent plunge in profit for the quarter ended Apr. 29, 2017. The company has earned $22.23 million, or $0.85 a share in the quarter, compared with $35.87 million, or $1.29 a share for the same period last year. Revenue during the quarter dropped 16.75 percent to $239.74 million from $287.97 million in the previous year period. Gross margin for the quarter contracted 387 basis points over the previous year period to 39.19 percent. Total expenses were 89.52 percent of quarterly revenues, up from 83.59 percent for the same period last year. That has resulted in a contraction of 593 basis points in operating margin to 10.48 percent.
Operating income for the quarter was $25.12 million, compared with $47.25 million in the previous year period.
"Our negative sales trend persisted throughout the first quarter, impacting margins and earnings as we continued to work through our merchandise missteps," stated John Cato, chairman, president, and chief executive officer. "It is taking longer to work through these issues than expected and the remainder of the year will be impacted. We expect earnings for the year to be below last year."
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