...A Successful Turnaround: Dillard's, Inc.'s (Dillard's) comparable store sales (comps) have increased for 14 consecutive quarters and have exceeded the industry average for most of that time frame. The company has also made strong progress in improving profitability on gross margin and expense control. EBITDA margin has improved to 12.1% in 2013 versus 9.5% in 2010 and 6.3% in 2007. Fitch Ratings expects Dillard's will continue to generate comps growth in the 1%¡2% range over the next 24 months and expects EBITDA margin to remain fairly flat. Strong Credit Metrics: While Dillard's credit metrics are strong for the `BBB¡' rating category with adjusted debt/EBITDAR currently at 1.1x, the ratings continue to incorporate Dillard's below industry-average sales productivity, as measured by sales per square foot, and operating profitability relative to its higher rated investment-grade department store peers that have EBITDA margins in the 14%¡15% range. Fitch expects Dillard's leverage to remain...
