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CHARLOTTE, N.C., Aug. 21, 2025 /PRNewswire/ --听The听Cato Corporation (NYSE: CATO) today reported net income of $6.8 million or $0.35 per diluted share for the second quarter ended August 2, 2025, compared to net income of $0.1 million or $0.01 per diluted share for the second quarter ended August 3, 2024.听

Sales for the second quarter ended August 2, 2025 were $174.7 million, or an increase of 5% from sales of $166.9 million for the second quarter ended August 3, 2024 primarily due to a 9% same-store sales increase for the quarter compared to 2024.

For the six months ended August 2, 2025, the Company reported net income of $10.1 million or $0.51 per diluted share, compared to net income of $11.1 million or $0.54 for the six months ended August 3, 2024.听 Sales for the six months ended August 2, 2025 were $343.1 million, an increase of 0.3% from sales of $342.2 million for the six months ended August 3, 2024 primarily due to a 4% same-store sales increase compared to 2024, mostly offset by the impact of closed stores.

"Our sales trend continued to improve during the second quarter.听 We attribute this improvement in part due to 2024 sales being impacted by supply chain disruptions," stated John Cato, Chairman, President, and Chief Executive Officer.听 "We will continue to tightly manage our expenses as we anticipate the back half of 2025 to be challenging due to the continued uncertainty regarding tariffs and the potential negative impact on our product acquisition costs."听 听

Gross margin increased from 34.6% to 36.2% of sales in the quarter due to lower distribution and buying costs, partially offset by lower merchandise margins.听 SG&A expenses as a percent of sales decreased from 34.9% to 32.8% of sales during the quarter primarily due to lower payroll and insurance costs, partially offset by higher advertising and general corporate costs. 听Income tax benefit for the quarter was $0.3 million versus an income tax expense of $0.6 million in the prior year.

Year-to-date gross margin increased from 35.2% of sales to 35.6% primarily due to lower distribution and buying costs, partially offset by lower merchandise margins.听 Year-to-date SG&A expenses were 32.8% as a percent of sales versus 33.6% in the prior year primarily due to lower payroll and insurance costs, partially offset by higher advertising expenses and general corporate costs. 听Income tax expense for the first half decreased to $0.6 million from $1.3 million last year.

During the second quarter ended August 2, 2025, the Company closed eight stores.听 As of August 2, 2025, the Company had 1,101 stores in 31 states, compared to 1,166 stores in 31 states as of August 3, 2024.

The听Cato Corporation is a leading specialty retailer of value-priced fashion apparel and accessories operating three concepts, "Cato," "Versona" and "It's Fashion."听 The Company's Cato stores offer exclusive merchandise with fashion and quality comparable to mall specialty stores at low prices every day.听 The Company also offers exclusive merchandise found in its Cato stores at .听 Versona is a unique fashion destination offering apparel and accessories including jewelry, handbags and shoes at exceptional prices every day.听 Select Versona merchandise can also be found at .听 It's Fashion offers fashion with a focus on the latest trendy styles for the entire family at low prices every day.

Statements in this press release that express a belief, expectation or intention, as well as those that are not a historical fact,听颈ncluding, without limitation, statements regarding the Company's expected or estimated operational financial results, activities or opportunities, and potential impacts and effects of interest rates, inflation or other factors that may affect our customers' discretionary spending or our costs are considered "forward-looking" within the meaning of The Private Securities Litigation Reform Act of 1995.听 Such forward-looking statements are based on current expectations that are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those contemplated by the forward-looking statements.听 Such factors include, but are not limited to, any actual or perceived deterioration in, or continuation of negative trends in, the conditions that drive consumer confidence and spending, including, but not limited to, prevailing social, economic, political and public health conditions and uncertainties, levels of unemployment, fuel, energy and food costs, inflation, wage rates, tax rates, interest rates, home values, consumer net worth and the availability of credit; changes in laws, regulations or government policies affecting our business including but not limited to tariffs; uncertainties regarding the impact of any governmental action regarding, or responses to, the foregoing conditions; competitive factors and pricing pressures; our ability to predict and respond to rapidly changing fashion trends and consumer demands; our ability to successfully implement our new store development strategy to increase new store openings and the ability of any such new stores to grow and perform as expected; underperformance or other factors that may lead to, or affect the volume of, store closures; adverse weather, public health threats (including the global coronavirus (COVID-19) outbreak), acts of war or aggression or similar conditions that may affect our merchandise supply chain, sales or operations; inventory risks due to shifts in market demand, including the ability to liquidate excess inventory at anticipated margins; adverse developments or volatility affecting the financial services industry or broader financial markets; and other factors discussed under "Risk Factors" in Part I, Item 1A 听of the Company's most recently filed annual report on Form 10-K and in other reports the Company files with or furnishes to the SEC from time to time.听 The Company does not undertake to publicly update or revise the forward-looking statements even if experience or future changes make it clear that the projected results expressed or implied therein will not be realized. The Company is not responsible for any changes made to this press release by wire or Internet services.

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SOURCE The Cato Corporation