Dillard’s Reports 54% Drop in Profit

Dillard’s Inc. said profit slid 54% to $26 million, or 30 cents a share, in its fiscal first quarter as the department store chain reduced prices to spur sales in a slowing economy. The company’s shares fell 18%.

The results missed the 33-cent average estimate of analysts polled by First Call/Thomson Financial. Sales at stores open at least a year fell 8%. “The business has just totally collapsed since the end of March,” Chief Executive William Dillard said. “Not just for us, but for everybody that uses our particular product mix.”

Dillard’s reduced inventory by about $135 million in the first quarter from a year earlier, the retailer’s sixth straight quarter of inventory reduction.

Shares of Little Rock, Ark.-based Dillard’s fell $2.54 to close at $16.98 on the NYSE.