Cato Corp.

The Cato Corp. (Charlotte, N.C.) has reported a 32 percent increase in net income for the second quarter ended July 30, 2005.

Sales for the quarter were up 6 percent. Same-store were flat.

For the six months ended July 30, net income increased 17 percent, sales gained 5 percentand same-store sales were flat.

“Our second quarter earnings improvement was primarily a result of higher merchandise gross margin due to better sell-throughs of regular priced merchandise,” said chairman, president and ceo John Cato. “In July, we successfully implemented a new warehouse management system. This paperless, radio frequency based system will improve accuracy, reduce costs, and speed the flow of merchandise to stores.”

During the first half, the specialty apparel retailer opened 27 stores, relocated seven stores and closed seven stores. The company expects to meet its original estimate of 90 new stores for the year. As of July 30, it operated 1197 stores in 31 states, compared to 1132 stores in 28 states a year ago.