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DILLARD'S QUELLS TAKEOVER RUMOR, POSTS HIGHER FOURTH-QUARTER PROFIT.

LITTLE ROCK, Ark.-Better inventory turns, reduced debt and a growing private-label business strengthened Dillard's fourth-quarter results.

The department store chain, the object of speculation of a Federated Department Stores or May Department Stores takeover, posted sales in the quarter ended Feb. 2 that decreased slightly to $2.5 billion from $2.7 billion in the same period last year, while net income rose 55 percent to $102 million, or $1.21 per share, from $66 million, or 78 cents per share.

Results in the most recent quarter include a pretax charge of $1 million, or 1 cent per share, relating to store closings. Results also include a gain of $1 million, or 1 cent per share, relating to an early debt pay-down. Year-ago results included a gain of $7 million, or 9 cents per share, relating to an early debt pay-down.

For the year, net sales fell 4.8 percent to $8.16 billion from $8.57 billion in the previous year. Net income came in at $72 million, compared with a loss of $6 million in the previous year.

In a conference call to investors, management withheld comment about takeover rumors, which surfaced following the death of the retailer's founder and chairman, William Dillard, in early February. However, the retailer said it adopted a stockholder rights plan, a "poison pill," which aims to ward off unfair takeover tactics. The plan takes effect if anyone acquires 15 percent of Dillard's stock.

When asked by an analyst if Dillard's adoption of the plan was intended to send a signal to the industry that the retailer is not on the selling block, James Freeman, chief financial officer and senior vice president, said, "it was not adopted in response to offers to buy the company."

Regarding the quarterly and year-end results, management cited the growth of its private-label business along with an improved merchandising strategy for the performance.

"Private label is an area of emphasis; we're growing it rapidly," Freeman said. The private-label business grew to 24.9 percent of sales in the most recent quarter, compared with 20.4 percent of sales in the same period last year

"We'll continue to ramp up the penetration of our private-label brands," Freeman said.
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Title Annotation:Dillard Department Stores Inc.
Comment:DILLARD'S QUELLS TAKEOVER RUMOR, POSTS HIGHER FOURTH-QUARTER PROFIT.(Dillard Department Stores Inc.)
Author:Zaczkiewicz, Arthur; report, Barbara Thau contributed to this
Publication:HFN The Weekly Newspaper for the Home Furnishing Network
Article Type:Brief Article
Geographic Code:1USA
Date:Mar 11, 2002
Words:370
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