Dillard's 2015 Annual Report Download - page 2

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Fiscal 2015 turned out to be a tough year for
Dillard’s. Our sales decelerated particularly in
the back half of the year, and this pressured
our operating results. We noted an unusually
competitive environment during the important
fourth quarter as we, along with our competitors,
dealt with higher inventory levels following
disappointing third quarter sales.
In spite of the disappointing results, we generated
cash from operations of $450 million during the year.
Shareholder return remained a high priority at
Dillard’s, and we repurchased $500 million of our
Class A Common Stock entirely from available
cash and operating cash flow.
We continue to evaluate best uses of the cash we
generate from the business, balancing investment in
the Company’s future with return to our shareholders.
The considerations include investing cash back into
the business through ongoing store upgrades as
well as other capital projects needed to ensure our
continued marketplace relevance. While retail
development has been slow to pick up following
the recession, we found a few exciting retail
developments in which to build stores in 2015.
In the fall, we opened newly constructed locations in
Liberty Center in Cincinnati, Ohio; Fremaux Town
Center in Slidell, Louisiana, and Fashion Place Mall
in Murray, Utah, where we replaced an existing
store in this vibrant center.
In recent years, our goal has been to return excess
cash to shareholders, and we accomplished that again
in 2015. Over the past seven years, we have returned
approximately $2.5 billion to shareholders in the
form of cash dividends and share repurchases. In
February of 2016, our Board of Directors approved
another $500 million share repurchase program.
Shareholder return will remain a priority at Dillard’s.
While much is being said lately about the decline
of traditional retail, we believe those who remain
engaged with their customers, both in store and
online, with compelling fashion and products
combined with premium service, will remain successful
in the marketplace. To that end, we continue to seek
out and to welcome exciting new, high profile brands
to Dillard’s. At the same time, we are investing in the
development and compensation of our associates
to elevate the entire customer experience.
While 2015 was challenging, we look forward to
2016 with an attractive line of products supported
by exceptional people. We thank our associates and
our customers for their support in 2015, and thank
you, our shareholders, for your continuing interest in
Dillard’s. We look forward to serving you in the future.
William Dillard, II Alex Dillard
Chairman of the Board & President
Chief Executive Officer
DEAR SHAREHOLDER,
DILLARD’S AT LIBERTY CENTER - CINCINNATI, OHIO • OPENED OCTOBER, 2015
A portion of the Grand Opening celebration sales was donated to Breast Cancer Research Foundation (BCRF®).