Cato Fashions Dresses
The Cato Corporation is a major American retailer of women’s fashions. Headquartered in Charlotte, North Carolina, Cato operates 1,372 stores under the brands , It’s Fashion, Versona, Cato Plus, and It’s Fashion Metro. As of January 2016, the company had more than $1 billion in sales.
The company’s aggressive approach to business openings helped the company nearly double its number of stores within two years. This strategy helped diversify in 1965. While operating losses at were disappointing, the company’s strong balance sheet and solid financial position have provided a guarantee of survival for the next few years.
While the company sells a range of fashion apparel under its own private label, most of the company’s merchandise is produced by vendors. The company’s It’s Fashion concept stores offer fashions for the entire family. In addition, the Versona concept stores and e-commerce Websites sell jewelry and accessories.
The Cato Corporation was founded in 1946 by Wayland and is headquartered in Charlotte, North Carolina. The company became a public company in 1968 and again in 1987. The company went through various crises and was successful in turning the company around. In the early 1990s, Cato’s division underwent a turnaround and went from struggling to profitable. The company is currently led by John , Jr., who has been with the company since 1981. Other key members of the company include John Howe, the CFO, Tim Greer, the director of stores, and Gordon Smith, the director of real estate.
The company owns more than 1,300 stores in the U.S. and operates them through its Retail and Credit segments. Most of its stores are private-label brands. The company sources its merchandise primarily from Southeast Asia, and it is heavily dependent on China for raw materials. The merchandise is shipped to the company’s distribution center in Charlotte, North Carolina. At least one shipment of clothing reaches each store every week. A director of stores and 138 district managers oversee the operation of each store.
After implementing changes to improve profitability, Cato’s stock price grew to $9.50 a year after falling to a 56-cent low in fiscal 1991. This turnaround allowed the company to reopen 68 stores and increase earnings from a loss to a profit. In addition, Cato has reopened 76 stores in the first nine months of fiscal 2020, despite many competitors closing their stores.
Cato has strong financial strength and a well-managed balance sheet. Its management team has extensive experience operating a retail corporation, and has consistently generated operating profits for its shareholders over the past 25 years. The company also has low employee turnover and many executive officers have been with the company for more than 30 years. This team has led the company through numerous downturns in the retail industry, and they will lead it through this latest pandemic as well.
Cato Corporation has a $27 million current income tax receivable, with the expectation of receiving the funds during the first half of fiscal 2021. In addition to these two important financial metrics, the company also owns two valuable real estate assets, including a 350-acre development in Fort Mill, S.C., and an 185-acre commercial parcel in Rock Hill, South Carolina. While these assets are not included in the company’s annual filings, they can be found on county property tax websites.
Cato’s seven stores made about $700,000 in sales in 1948 and $30k in net earnings. They hit $1 million in sales in 1949. The average sales per store was around $85,000-$100,000. During its early years, the company hired local women to run the stores. One such employee was Della Parish in Gaffney, South Carolina. She performed alterations on her own time and was instrumental in keeping the stores open. However, a poor hiring decision made by Wayland Cato Sr. resulted in a merchandise manager who ordered upscale styles that didn’t sell well in the rural South. In 1956, Cato slowed down operations and cut back on the number of stores, though earnings continued to rise.