Cato lifts 4th-quarter guidance after key sales comparison rises 7 percent in December

Cato December sales comparison rises 7 percent

CHARLOTTE, N.C. — Women’s apparel retailer Cato Corp. on Thursday sharply raised its fourth-quarter guidance as it reported that sales in stores open at least one year climbed 7 percent in December.

Sales at stores open at least a year are a key measure of retailer performance because they measure growth at existing stores rather than from newly opened ones.

Total sales for the five weeks ended Jan. 2 rose 8 percent to $104.1 million from $96.1 million, as colder weather drove more customers to buy winter clothing. Due to the better-than-expected performance, Cato now expects fourth-quarter earnings to range between 20 cents and 22 cents per share, up from prior guidance of 8 cents to 13 cents per share.

For the full year it is forecasting profit of $1.51 to $1.53 per share.

Year-to-date, sales in stores open at least one year have risen 2 percent while total sales are up 3 percent to $820 million.

Shares rose 14 cents to $21.26 in morning trading.