Dillard's 2009 Annual Report Download - page 21

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As of January 30, 2010, we had working capital of $980.5 million, cash and cash equivalents of
$341.7 million and $949.3 million of total debt outstanding. Cash flows from operating activities were
$554.0 million for fiscal 2009. We operated 309 total stores as of January 30, 2010, a decrease of 6
stores from the same period last year.
Key Performance Indicators
We use a number of key indicators of financial condition and operating performance to evaluate
the performance of our business, including the following:
Fiscal Year Ended
January 30, January 31, February 2,
(retail segment only, excluding cash flow data) 2010 2009 2008
Net sales (in millions) .................. $5,890.0 $6,742.6 $7,207.4
Sales per square foot ................... $ 110 $ 124 $ 128
Total store count at end of period ......... 309 315 326
Net sales trend ....................... (13)% (6)% (6)%
Comparable store sales trend ............. (10)% (7)% (6)%
Gross profit (in millions) ................ $1,982.9 $1,998.6 $2,420.8
Gross profit as a percentage of net sales ..... 33.7% 29.6% 33.6%
Comparable store inventory trend ......... (5)% (20)% (1)%
Merchandise inventory turnover ........... 2.6 2.6 2.5
Cash flow from operations (in millions) ..... $ 554.0 $ 350.0 $ 254.4
Trends and Uncertainties
Fluctuations in the following key trends and uncertainties which we have identified may have a
material effect on our operating results.
• Cash flow—Cash from operating activities is a primary source of liquidity that is adversely
affected when the industry faces economic challenges. Furthermore, operating cash flow can be
negatively affected when new and existing competitors seek areas of growth to expand their
businesses.
• Pricing—If our customers do not purchase our merchandise offerings in sufficient quantities, we
respond by taking markdowns. If we have to reduce our retail selling prices, the cost of goods
sold on our income statement will correspondingly rise, thus reducing our income.
• Success of brand—The success of our exclusive brand merchandise as well as merchandise we
source from national vendors is dependent upon customer fashion preferences and how well we
can predict and anticipate trends.
• Sourcing—Our store merchandise selection is dependent upon our ability to acquire appealing
products from a number of sources. Our ability to attract and retain compelling vendors as well
as in-house design talent, the adequacy and stable availability of materials and production
facilities from which we source our merchandise and the speed at which we can respond to
customer trends and preferences have a significant impact on our merchandise mix and, thus,
our ability to sell merchandise at profitable prices.
• Store growth—Although store growth is presently not a near-term goal, such growth is
dependent upon a number of factors which could impede our ability to open new stores, such as
the identification of suitable markets and locations and the availability of shopping
developments, especially in a weak economic environment.
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