The following discussion should be read in conjunction with the condensed consolidated financial statements and the footnotes thereto included elsewhere in this report, as well as the financial and other information included in our Annual Report on Form 10-K for the year endedJanuary 30, 2021 . Due to the significant impact of COVID-19 on prior year figures, the information that follows will include certain comparisons to 2019 to provide additional context.
EXECUTIVE OVERVIEW
InMarch 2020 , theWorld Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic, which continues to impactthe United States and global economies. The COVID-19 pandemic has had and may continue to have a significant impact on the Company's business, results of operations and financial position. The Company began closing stores onMarch 19, 2020 as mandated by state and local governments, and byApril 9, 2020 , all of the Company's brick-and-mortar store locations were temporarily closed to the public. Our eCommerce capabilities allowed us to use our closed store locations (with limited staffing) to fill orders from our Internet store. During the month endedMay 30, 2020 (fiscal May), we re-opened most of our full-line stores, and byJune 2, 2020 all Dillard's store locations had been re-opened. Following our re-opening, a very small number of our locations were temporarily closed to in-store shopping due to government mandate. All stores are currently open and are operating at reduced hours from fiscal 2019 operating hours. The Company's performance for the three months endedMay 1, 2021 improved significantly compared to the three months endedMay 2, 2020 . Total retail sales increased approximately 73% over the first quarter of 2020, as the arrival of vaccinations and release of stimulus money combined with warmer weather during the first quarter of 2021 were catalysts in addition to the re-opening of stores. Due to the temporary closure of the Company's brick-and-mortar stores during the three months endedMay 2, 2020 as well as the interdependence between in-store and online sales, the Company reported no comparable store sales data for the three months endedMay 1, 2021 compared to the three months endedMay 2, 2020 . Retail gross margin increased to a record 42.6% during the three months endedMay 1, 2021 compared to 12.8% during the three months endedMay 2, 2020 , primarily due to decreased markdowns. The Company reduced inventory by approximately 17% compared to the prior year first quarter. Selling, general and administrative expenses increased to$336.6 million compared to$290.4 million from the prior year first quarter primarily due to increases in payroll expense, which was driven by the re-opening of our retail store locations. The Company reported net income of$158.2 million (a record$7.25 per share) compared to a net loss of$162.0 million ($6.94 per share) for the prior year first quarter. Included in net income for the three months endedMay 1, 2021 is a pretax gain on disposal of assets of$24.7 million ($19.2 million after tax or$0.88 per share) primarily related to the sale of three store properties. Included in the net loss for the three months endedMay 2, 2020 is a net tax benefit of$14.8 million ($0.63 per share) related to The Coronavirus Aid, Relief and Economic Security Act ("CARES Act"), signed into law onMarch 27, 2020 , which allowed for net operating loss carryback to years in which the federal income tax rate was 35%. During the three months endedMay 1, 2021 , the Company purchased$58.8 million of its outstanding Class A Common Stock under its stock repurchase plan authorized by the Company's Board of Directors inMarch 2018 (the "March 2018 Plan"). As ofMay 1, 2021 , authorization of$114.3 million remained under theMarch 2018 Plan. OnMay 15, 2021 , the Company announced that its Board of Directors approved a new stock repurchase program authorizing the Company to repurchase up to$500 million of its Class A Common Stock. As ofMay 1, 2021 , the Company had working capital of$1,019.8 million (including cash and cash equivalents of$615.9 million ) and$565.9 million of total debt outstanding, excluding finance lease liabilities and operating lease liabilities, with no scheduled maturities until the end of fiscal 2022. Cash flows provided by operating activities were$302.4 million for the three months endedMay 1, 2021 .
The Company maintained 281 Dillard's stores, including 31 clearance centers, and
an internet store at
17 -------------------------------------------------------------------------------- Table of Contents Key Performance Indicators
We use a number of key indicators of financial condition and operating performance to evaluate our business, including the following:
Three Months Ended
May 1, May 2, 2021 2020 Net sales (in millions)$ 1,328.5 $ 786.7 Retail stores sales trend 73 % (47) % Gross profit (in millions)$ 554.5 $ 98.2 Gross profit as a percentage of net sales 41.7 % 12.5 % Retail gross profit as a percentage of net sales 42.6 % 12.8 %
Selling, general and administrative expenses as a percentage of net sales
25.3 % 36.9 % Cash flow provided by (used in) operations (in millions)$ 302.4 $ (111.1) Total retail store count at end of period 281 285 Retail sales per square foot$ 28 $ 16 Retail store inventory trend (17) % (14) % Annualized retail merchandise inventory turnover 2.5 1.6 General Net sales. Net sales includes merchandise sales of comparable and non-comparable stores and revenue recognized on contracts ofCDI Contractors, LLC ("CDI"), the Company's general contracting construction company. Comparable store sales includes sales for those stores which were in operation for a full period in both the most recently completed quarter and the corresponding quarter for the prior fiscal year, including our internet store. Comparable store sales excludes changes in the allowance for sales returns. Non-comparable store sales includes: sales in the current fiscal year from stores opened during the previous fiscal year before they are considered comparable stores; sales from new stores opened during the current fiscal year; sales in the previous fiscal year for stores closed during the current or previous fiscal year that are no longer considered comparable stores; sales in clearance centers; and changes in the allowance for sales returns. Sales occur as a result of interaction with customers across multiple points of contact, creating an interdependence between in-store and online sales. Online orders are fulfilled from both fulfillment centers and retail stores. Additionally, online customers have the ability to buy online and pick up in-store. Retail in-store customers have the ability to purchase items that may be ordered and fulfilled from either a fulfillment center or another retail store location. Online customers may return orders via mail, or customers may return orders placed online to retail store locations. Customerswho earn reward points under the private label credit card program may earn and redeem rewards through in-store or online purchases. Service charges and other income. Service charges and other income includes income generated through the long-term marketing and servicing alliance withWells Fargo Bank, N.A. ("Wells Fargo Alliance "). Other income includes rental income, shipping and handling fees, gift card breakage and lease income on leased departments. Cost of sales. Cost of sales includes the cost of merchandise sold (net of purchase discounts, non-specific margin maintenance allowances and merchandise margin maintenance allowances), bankcard fees, freight to the distribution centers, employee and promotional discounts, shipping to customers and direct payroll for salon personnel. Cost of sales also includes CDI contract costs, which comprise all direct material and labor costs, subcontract costs and those indirect costs related to contract performance, such as indirect labor, employee benefits and insurance program costs. Selling, general and administrative expenses. Selling, general and administrative expenses include buying, occupancy, selling, distribution, warehousing, store and corporate expenses (including payroll and employee benefits), insurance, employment taxes, advertising, management information systems, legal and other corporate level expenses. Buying expenses consist of payroll, employee benefits and travel for design, buying and merchandising personnel.
Depreciation and amortization. Depreciation and amortization expenses include depreciation and amortization on property and equipment.
18 -------------------------------------------------------------------------------- Table of Contents Rentals. Rentals includes expenses for store leases, including contingent rent, data processing and other equipment rentals and office space leases. Interest and debt expense, net. Interest and debt expense includes interest, net of interest income and capitalized interest, relating to the Company's unsecured notes, subordinated debentures and borrowings under the Company's credit agreement. Interest and debt expense also includes the amortization of financing costs and interest on finance lease obligations.
Other expense. Other expense includes the interest cost and net actuarial loss components of net periodic benefit costs related to the Company's unfunded, nonqualified defined benefit plan and charges related to the write-off of deferred financing fees, if any.
Gain on disposal of assets. Gain on disposal of assets includes the net gain or loss on the sale or disposal of property and equipment, as well as gains from insurance proceeds in excess of the cost basis of insured assets, if any.
LIBOR
OnMarch 5, 2021 , theU.K. Financial Conduct Authority , which regulates LIBOR, announced that all LIBOR settings will either cease to be provided by any administrator or no longer be representative: (a) immediately afterDecember 31, 2021 , in the case of the 1-week and 2-monthU.S. dollar settings; and (b) immediately afterJune 30, 2023 , in the case of the remainingU.S. dollar settings. Going forward, we intend to work with our lenders to use a suitable alternative reference rate for the 2021 amended credit agreement, theWells Fargo Alliance and any other applicable agreements. We will continue to monitor, assess and plan for the phase out of LIBOR.
Seasonality
Our business, like many other retailers, is subject to seasonal influences, with a significant portion of sales and income typically realized during the last quarter of our fiscal year due to the holiday season. Because of the seasonality of our business, results from any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year. 19 -------------------------------------------------------------------------------- Table of Contents RESULTS OF OPERATIONS
The following table sets forth the results of operations as a percentage of net sales for the periods indicated (percentages may not foot due to rounding):
Three Months Ended May 1, May 2, 2021 2020 Net sales 100.0 % 100.0 % Service charges and other income 2.2 4.4 102.2 104.4 Cost of sales 58.3 87.5 Selling, general and administrative expenses 25.3
36.9
Depreciation and amortization 3.5
6.5
Rentals 0.4
0.7
Interest and debt expense, net 0.9 1.6 Other expense 0.4 0.3 Gain on disposal of assets (1.9) - Income (loss) before income taxes 15.3 (29.0) Income taxes (benefit) 3.4 (8.4) Net income (loss) 11.9 % (20.6) % Net Sales Three Months Ended May 1, May 2, (in thousands of dollars) 2021 2020 $ Change Net sales: Retail operations segment$ 1,296,736 $ 751,027 $ 545,709 Construction segment 31,807 35,628 (3,821) Total net sales$ 1,328,543 $ 786,655 $ 541,888 The percent change in the Company's sales by segment and product category for the three months endedMay 1, 2021 compared to the three months endedMay 2, 2020 as well as the sales percentage by segment and product category to total net sales for the three months endedMay 1, 2021 are as follows: % Change % of 2021 - 2020 Net Sales Retail operations segment Cosmetics 60.0 % 14 % Ladies' apparel 74.4 23 Ladies' accessories and lingerie 81.2 15 Juniors' and children's apparel 84.5 11 Men's apparel and accessories 81.9 17 Shoes 63.4 15 Home and furniture 47.0 3 98 Construction segment (10.7) 2 Total 100 % 20
-------------------------------------------------------------------------------- Table of Contents Net sales from the retail operations segment increased$545.7 million , or approximately 73%, during the three months endedMay 1, 2021 compared to the three months endedMay 2, 2020 , primarily due to the impact of the COVID-19 pandemic. The Company reported no comparable store sales data for the quarter due to the temporary closure of its brick-and-mortar stores as well as the interdependence between in-store and online sales during the three months endedMay 2, 2020 . Sales in all product categories increased significantly over the first quarter last year. Compared to the first quarter of fiscal 2019, net sales from the retail operations segment for the three months endedMay 1, 2021 andMay 4, 2019 were$1,296.7 million and$1,420.5 million , respectively, decreasing$123.8 million or approximately 9%. Net sales in comparable stores for the three months endedMay 1, 2021 andMay 4, 2019 declined approximately 6%.
We recorded a return asset of
During the three months endedMay 1, 2021 , net sales from the construction segment decreased$3.8 million or 10.7% compared to the three months endedMay 2, 2020 due to a decrease in construction activity. The remaining performance obligations related to executed construction contracts totaled$54.4 million as ofMay 1, 2021 , decreasing approximately 29% fromJanuary 30, 2021 and decreasing approximately 63% fromMay 2, 2020 , respectively. We expect these remaining performance obligations to be earned over the next nine to eighteen months.
Service Charges and Other Income
Three Months Ended Three Months $ Change 2021 (in thousands of dollars) May 1, 2021 May 2, 2020 -
2020
Service charges and other income: Retail operations segment Income fromWells Fargo Alliance $ 17,707 $ 20,800 $ (3,093) Shipping and handling income 8,480 11,567 (3,087) Leased department income 3 372 (369) Other 2,424 1,748 676 28,614 34,487 (5,873) Construction segment 378 434 (56) Total service charges and other income$ 28,992 $ 34,921 $ (5,929) Service charges and other income is composed primarily of income from theWells Fargo Alliance . Income from the alliance decreased$3.1 million during the three months endedMay 1, 2021 compared to the three months endedMay 2, 2020 primarily due to decreases in finance charges. Shipping and handling income decreased$3.1 million during the three months endedMay 1, 2021 compared to the three months endedMay 2, 2020 primarily due to an increase in online orders in 2020 as customer shopping patterns shifted to dillards.com as COVID-19 infection levels increased and brick-and-mortar stores were temporarily closed. Compared to the first quarter of fiscal 2019, shipping and handling income for the three months endedMay 1, 2021 andMay 4, 2019 was$8.5 million and$6.1 million , respectively, increasing$2.4 million or 39.5%. Leased department income consisted primarily of commissions from a principal licensed department of an upscale women's apparel vendor located in certain stores. By the end ofJuly 2020 , our agreement with this principal licensed department had been terminated. We expect future leased department income to be minimal. 21 --------------------------------------------------------------------------------
Table of Contents Gross Profit (in thousands of dollars) May 1, 2021 May 2, 2020 $ Change % Change Gross profit: Three months ended Retail operations segment$ 553,001 $ 96,034 $ 456,967 475.8 % Construction segment 1,453 2,152 (699) (32.5) Total gross profit$ 554,454 $ 98,186 $ 456,268 464.7 % Three Months Ended May 1, 2021
42.6 % 12.8 % Construction segment 4.6
6.0
Total gross profit as a percentage of net sales 41.7
12.5
Gross profit, as a percentage of sales, increased to 41.7% from 12.5% during the three months endedMay 1, 2021 compared to the three months endedMay 2, 2020 , respectively. Gross profit from retail operations, as a percentage of sales, increased to 42.6% from 12.8% during the three months endedMay 1, 2021 compared to the three months endedMay 2, 2020 , respectively, primarily due to increased markdowns taken during the first quarter of fiscal 2020 as a result of the impact of the COVID-19 pandemic as well as better inventory management and customer demand leading to decreased markdowns in the first quarter of fiscal 2021. Gross margin increased significantly in all product categories except cosmetics which increased moderately. Compared to the first quarter of fiscal 2019, gross profit from retail operations, as a percentage of sales, increased 489 basis points of sales to 42.6% during the three months endedMay 1, 2021 compared to 37.8% during the three months endedMay 4, 2019 primarily due to better inventory management and customer demand leading to decreased markdowns in the first quarter of fiscal 2021.
Gross profit from the construction segment decreased 147 basis points of
construction sales for the three months ended
Inventory decreased 17% in total as of
A
1% change in the dollar amount of markdowns would have impacted net income by
approximately
Selling, General and Administrative Expenses ("SG&A")
(in thousands of dollars) May 1, 2021 May 2, 2020 $ Change % Change SG&A: Three months ended Retail operations segment$ 335,143 $ 288,557 $ 46,586 16.1 % Construction segment 1,471 1,889 (418) (22.1) Total SG&A$ 336,614 $ 290,446 $ 46,168 15.9 % Three Months Ended May 1, 2021 May 2, 2020 SG&A as a percentage of segment net sales: Retail operations segment 25.8 % 38.4 % Construction segment 4.6
5.3
Total SG&A as a percentage of net sales 25.3 36.9 22
-------------------------------------------------------------------------------- Table of Contents SG&A decreased to 25.3% of sales during the three months endedMay 1, 2021 compared to 36.9% of sales during the three months endedMay 2, 2020 , while increasing$46.2 million . SG&A from retail operations decreased to 25.8% of sales for the three months endedMay 1, 2021 compared to 38.4% of sales for the three months endedMay 2, 2020 , while increasing$46.6 million . The increase in SG&A dollars was primarily due to increases in payroll expense and related payroll taxes. Payroll expense and related payroll taxes for the three months endedMay 1, 2021 was$225.4 million compared to$183.8 million for the three months endedMay 2, 2020 , increasing$41.5 million . During the first quarter of fiscal 2020, theCompany (a) furloughed store associates as stores temporarily closed due to the COVID-19 pandemic and furloughed associates in certain corporate and support facility functions and (b) reduced payroll expense by$4.2 million through the employee retention credit available under the CARES Act. Compared to the first quarter of fiscal 2019, SG&A from retail operations for the three months endedMay 1, 2021 andMay 4, 2019 were$335.1 million (25.8% of sales) and$403.3 million (28.4% of sales), decreasing$68.1 million primarily due to decreases in payroll expense and related payroll taxes. During the first quarter of fiscal 2021, stores were operating at reduced operating hours from the first quarter of fiscal 2019, requiring fewer sales associates.
Depreciation and Amortization
(in thousands of dollars) May 1, 2021 May 2, 2020 $ Change % Change Depreciation and amortization: Three months ended Retail operations segment$ 46,338 $ 50,732 $ (4,394) (8.7) % Construction segment 70 169 (99) (58.6) Total depreciation and amortization$ 46,408 $ 50,901
Depreciation and amortization expense decreased
Interest and Debt Expense, Net (in thousands of dollars) May 1, 2021 May 2, 2020 $ Change % Change Interest and debt expense (income), net: Three months ended Retail operations segment$ 11,550 $ 12,291 $ (741) (6.0) % Construction segment (15) (21) 6 28.6 Total interest and debt expense, net$ 11,535 $ 12,270 $ (735) (6.0) % Net interest and debt expense decreased$0.7 million and total weighted average debt decreased by$265.4 million during the three months endedMay 1, 2021 compared to the three months endedMay 2, 2020 primarily due to a decrease of short term borrowings under the credit facility. Other Expense (in thousands of dollars) May 1, 2021 May 2, 2020 $ Change % Change Other expense: Three months ended Retail operations segment$ 4,964 $ 2,104 $ 2,860 135.9 % Construction segment - - - - Total other expense$ 4,964 $ 2,104 $ 2,860 135.9 % Other expense increased$2.9 million during the three months endedMay 1, 2021 compared to the three months endedMay 2, 2020 primarily due to the write-off of certain deferred financing fees in connection with the amendment and extension of the Company's secured revolving credit facility. 23 -------------------------------------------------------------------------------- Table of Contents Gain on Disposal of Assets (in thousands of dollars) May 1, 2021 May 2,
2020 $ Change
Gain on disposal of assets:
Three months ended
Retail operations segment$ (24,673) $
(18)
Construction segment - (1) 1
Total gain on disposal of assets
During the three months ended
Income Taxes
The Company's estimated federal and state effective income tax rate was approximately 22.2% and 29.0% for the three months endedMay 1, 2021 andMay 2, 2020 , respectively. During the three months endedMay 1, 2021 , income tax expense differed from what would be computed using the statutory federal income tax rate primarily due to the effects of state and local income taxes and federal tax credits. The Company was in a net operating loss position for the fiscal year endedJanuary 30, 2021 . The Coronavirus Aid, Relief and Economic Security ("CARES") Act, signed into law onMarch 27, 2020 , allows for net operating loss carryback to years in which the statutory federal income tax rate was 35% rather than the current 21%. During the three months endedMay 2, 2020 , income tax benefit differed from what would be computed using the current statutory federal income tax rate of 21% primarily due to the recognition of a net tax benefit of$14.8 million related to the rate differential in the carryback year. Income tax benefit for the quarter also included the effects of state and local income taxes and federal tax credits. The Company expects the fiscal 2021 federal and state effective income tax rate to approximate 22% to 23%. This rate may change if results of operations for fiscal 2021 differ from management's current expectations. Changes in the Company's assumptions and judgments can materially affect amounts recognized in the condensed consolidated financial statements. 24 -------------------------------------------------------------------------------- Table of Contents FINANCIAL CONDITION A summary of net cash flows for the three months endedMay 1, 2021 andMay 2, 2020 follows: Three Months Ended (in thousands of dollars) May 1, 2021 May 2, 2020 $ Change Operating Activities $
302,413
14,183 (19,904) 34,087 Financing Activities (61,015) (76,054) 15,039 Total Increase (Decrease) in Cash and Cash Equivalents $
255,581
Net cash flows from operations increased$413.5 million during the three months endedMay 1, 2021 compared to the three months endedMay 2, 2020 due to significant increases in net income, primarily due to increases in gross profit and changes in working capital. Compared to the first quarter of fiscal 2019, net cash flows from operations for the three months endedMay 1, 2021 andMay 4, 2019 were$302.4 million and$48.4 million , respectively, increasing$254.0 million . Wells Fargo owns and manages the Dillard's private label cards under theWells Fargo Alliance . Under theWells Fargo Alliance , Wells Fargo establishes and owns private label card accounts for our customers, retains the benefits and risks associated with the ownership of the accounts, provides key customer service functions, including new account openings, transaction authorization, billing adjustments and customer inquiries, receives the finance charge income and incurs the bad debts associated with those accounts. Pursuant to theWells Fargo Alliance , we receive ongoing cash compensation from Wells Fargo based upon the portfolio's earnings. The compensation received from the portfolio is determined monthly and has no recourse provisions. The amount the Company receives is dependent on the level of sales on Wells Fargo accounts, the level of balances carried on Wells Fargo accounts by Wells Fargo customers, payment rates on Wells Fargo accounts, finance charge rates and other fees on Wells Fargo accounts, the level of credit losses for the Wells Fargo accounts as well as Wells Fargo's ability to extend credit to our customers. We participate in the marketing of the private label cards, which includes the cost of customer reward programs.The Wells Fargo Alliance expires in fiscal 2024. The Company received income of$17.7 million and$20.8 million from theWells Fargo Alliance during the three months endedMay 1, 2021 andMay 2, 2020 , respectively. The Company cannot reasonably predict whether there will be any ongoing impact or the magnitude of any such impact of the COVID-19 pandemic on the portfolio's future earnings and the ongoing cash compensation from theWells Fargo Alliance . During the three months endedMay 1, 2021 , the Company received proceeds from insurance of$1.8 million for claims filed for merchandise losses related to storm damage incurred at two stores. Capital expenditures were$16.9 million and$20.2 million for the three months endedMay 1, 2021 andMay 2, 2020 , respectively. The capital expenditures were primarily related to equipment purchases and the continued construction of two new stores during the current year. The Company has announced plans to open a new store atMesa Mall inGrand Junction, Colorado during the Fall of 2021 (105,000 square feet). The Company has also announced plans to open a new store atUniversity Place inOrem, Utah in the Spring of 2022 (160,000 square feet). Both opportunities arose from peer closures at those centers. During the three months endedMay 1, 2021 , the Company received cash proceeds of$29.3 million and recorded a related gain of$24.7 million , primarily from the sale of three store properties: (1) a 120,000 square foot location atCortana Mall inBaton Rouge, Louisiana , which was permanently closed and sold; (2) a 200,000 square foot location atParadise Valley Mall inPhoenix, Arizona , which was sold and is expected to close during our second fiscal quarter and (3) a non-operating store property inKnoxville, Tennessee . There were no material costs associated with any of these store closures. We remain committed to closing under-performing stores where appropriate and may incur future closing costs related to such stores when they close. During the three months endedMay 1, 2021 , the Company received proceeds from insurance of$1.8 million for claims filed for building losses related to storm damage incurred at two stores. The Company had cash on hand of$615.9 million as ofMay 1, 2021 . During the first quarter of fiscal 2020 and as part of our overall liquidity management strategy and for peak working capital requirements, the Company maintained an unsecured 25 -------------------------------------------------------------------------------- Table of Contents credit facility that provided a borrowing capacity of$800 million with a$200 million expansion option ("credit agreement"). As part of the Company's liquidity strategy during the COVID-19 pandemic, inMarch 2020 , the Company borrowed$779 million under the credit agreement. The credit agreement was amended inApril 2020 and became secured by certain deposit accounts of the Company and certain inventory of certain subsidiaries (the "2020 amended credit agreement"). The borrowings of$779 million were repaid concurrent with the execution of the 2020 amended credit agreement. During the three months endedMay 2, 2020 , the Company paid$2.9 million in issuance costs related to the 2020 amended credit agreement, which were recorded in other assets on the condensed consolidated balance sheet. InApril 2021 , the Company further amended its secured credit agreement (the "2021 amended credit agreement"). See Note 7, Revolving Credit Agreement, in the "Notes to Condensed Consolidated Financial Statements," in Part I, Item I hereof for additional information. During the three months endedMay 1, 2021 , the Company paid$2.7 million in issuance costs related to the 2021 amended credit agreement, which were recorded in other assets on the condensed consolidated balance sheet, and the Company recognized a loss on the early extinguishment of debt of$2.8 million for the write-off of certain remaining deferred financing fees related to the previous amended secured credit agreement. This charge was recorded in other expense on the condensed consolidated statement of operations.
At
During the three months endedMay 1, 2021 , the Company repurchased 0.6 million shares of Class A Common Stock at an average price of$94.12 per share for$58.8 million (including the accrual of$4.0 million of share repurchases that had not settled as ofMay 1, 2021 ) under the Company'sMarch 2018 Plan. During the three months endedMay 2, 2020 , the Company repurchased 1.0 million shares of Class A Common Stock at an average price of$61.91 per share for$61.8 million under the Company'sMarch 2018 Plan. Additionally, the Company paid$7.3 million for share repurchases that had not yet settled but were accrued atFebruary 1, 2020 . AtMay 1, 2021 ,$114.3 million of authorization remained under theMarch 2018 Plan. The ultimate disposition of the repurchased stock has not been determined. See Note 8, Stock Repurchase Programs, in the "Notes to Condensed Consolidated Financial Statements," in Part I, Item I hereof for additional information. The COVID-19 pandemic has had and may continue to have a significant impact on the Company's business, results of operations and financial position. Because there is still significant uncertainty around the effects of the COVID-19 pandemic on the Company's business operations, our profitability and liquidity may be further impacted if we are unable to appropriately manage our inventory levels and expenses relative to any change in consumer demand. The Company expects to finance its operations during fiscal 2021 from cash on hand, cash flows generated from operations and utilization of the credit facility. Depending upon our actual and anticipated sources and uses of liquidity, the Company will from time to time consider other possible financing transactions, the proceeds of which could be used to fund working capital or for other corporate purposes. There have been no material changes in the information set forth under caption "Commercial Commitments" in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, in the Company's Annual Report on Form 10-K for the fiscal year endedJanuary 30, 2021 . 26 -------------------------------------------------------------------------------- Table of Contents OFF-BALANCE-SHEET ARRANGEMENTS The Company has not created, and is not party to, any special-purpose entities or off-balance-sheet arrangements for the purpose of raising capital, incurring debt or operating the Company's business. The Company does not have any off-balance-sheet arrangements or relationships that are reasonably likely to materially affect the Company's financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or the availability of capital resources.
NEW ACCOUNTING STANDARDS
For information with respect to new accounting pronouncements and the impact of these pronouncements on our consolidated financial statements, see Note 2, Accounting Standards, in the "Notes to Condensed Consolidated Financial Statements," in Part I, Item I hereof.
FORWARD-LOOKING INFORMATION
This report contains certain forward-looking statements. The following are or may constitute forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995: (a) statements including words such as "may," "will," "could," "should," "believe," "expect," "future," "potential," "anticipate," "intend," "plan," "estimate," "continue," or the negative or other variations thereof; (b) statements regarding matters that are not historical facts; and (c) statements about the Company's future occurrences, plans and objectives, including statements regarding management's expectations and forecasts for the remainder of fiscal 2021 and beyond, statements concerning the opening of new stores or the closing of existing stores, statements concerning capital expenditures and sources of liquidity, statements regarding the expected impact of the COVID-19 pandemic and related government responses, including the CARES Act and other subsequently-enacted COVID-19 stimulus packages, statements concerning share repurchases, statements concerning pension contributions, statements regarding the expected phase out of LIBOR and statements concerning estimated taxes. The Company cautions that forward-looking statements contained in this report are based on estimates, projections, beliefs and assumptions of management and information available to management at the time of such statements and are not guarantees of future performance. The Company disclaims any obligation to update or revise any forward-looking statements based on the occurrence of future events, the receipt of new information, or otherwise. Forward-looking statements of the Company involve risks and uncertainties and are subject to change based on various important factors. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements made by the Company and its management as a result of a number of risks, uncertainties and assumptions. Representative examples of those factors include (without limitation) the COVID-19 pandemic and its effects on public health, our supply chain, the health and well-being of our employees and customers, and the retail industry in general; other general retail industry conditions and macro-economic conditions; economic and weather conditions for regions in which the Company's stores are located and the effect of these factors on the buying patterns of the Company's customers, including the effect of changes in prices and availability of oil and natural gas; the availability of consumer credit; the impact of competitive pressures in the department store industry and other retail channels including specialty, off-price, discount and Internet retailers; changes in consumer spending patterns, debt levels and their ability to meet credit obligations; changes in tax legislation; changes in legislation, affecting such matters as the cost of employee benefits or credit card income; adequate and stable availability and pricing of materials, production facilities and labor from which the Company sources its merchandise; changes in operating expenses, including employee wages, commission structures and related benefits; system failures or data security breaches; possible future acquisitions of store properties from other department store operators; the continued availability of financing in amounts and at the terms necessary to support the Company's future business; fluctuations in LIBOR and other base borrowing rates; the elimination of LIBOR; potential disruption from terrorist activity and the effect on ongoing consumer confidence; other epidemic, pandemic or public health issues; potential disruption of international trade and supply chain efficiencies; any government-ordered restrictions on the movement of the general public or the mandated or voluntary closing of retail stores in response to the COVID-19 pandemic; world conflict and the possible impact on consumer spending patterns and other economic and demographic changes of similar or dissimilar nature. The Company's filings with theSecurities and Exchange Commission , including its Annual Report on Form 10-K for the fiscal year endedJanuary 30, 2021 , contain other information on factors that may affect financial results or cause actual results to differ materially from forward-looking statements. 27
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