Overview

* Cato Q2 net income rises to $6.8 mln from $0.1 mln last year

* Sales for Q2 up 5% to $174.7 mln, driven by 9% same-store sales increase

* Gross margin improved due to lower distribution and buying costs

* Company closed eight stores, reducing total to 1,101

Outlook

* Cato anticipates challenges in H2 2025 due to tariff uncertainties

* Company plans to tightly manage expenses

Result Drivers

* SAME-STORE SALES - 9% increase in same-store sales drove revenue growth, attributed to resolution of 2024 supply chain disruptions

* EXPENSE MANAGEMENT - SG&A expenses as a percentage of sales decreased due to lower payroll and insurance costs, despite higher advertising and corporate costs

* GROSS MARGIN - Improved gross margin due to lower distribution and buying costs, partially offset by lower merchandise margins

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q2 $174.65

Retail mln

Sales

Q2 EPS $0.35

Q2 Net $6.83

Income mln

Q2 Basic $0.35

EPS

Q2 $6.54

Pretax mln

Profit

Press Release:

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)