Bill Dillard II has served as CEO of the family's department store chain since his dad retired in 1998. His 10% stake was worth as much as $800 million in November as the stock climbed to record heights.The secretive clan behind the Dillard’s department store chain has a reputation for avoiding reporters, refusing to hold earnings calls and dodging investor queries about their results.
The market capitalization of the 280-stored chain has quadrupled to more than $5 billion since Jan. 1, far outpacing gains seen by much larger chains like Macy’s , Kohl’s and Nordstrom . Shares have cooled in recent weeks on fears of the omicron variant and a downgrade from an analyst sour on the prospect of department stores heading into next year.
Grandson Bill Dillard III, 50, is part of the third-generation to help run the retailer. He oversees merchandising for cosmetics, men’s apparel and other areas.While nine out of 15 board members are non-family members, including the billionaire CEO of Little Rock investment bank Warren Stephens, there are no outsiders on the management team, which lacks a chief financial officer, chief operating officer or chief marketing officer.
Investors have piled in, propelling Dillard’s stock from $58 on Jan. 1 to a peak of $410 in November, a 600% gain. That run-up has enriched more than the Dillards. Some 40% of the company’s stock is held by workers in their retirement plans, thanks in large part to the company’s 401 matching, which comes in the form of Dillard’s shares. Full-time employees are eligible to receive stock after they work for the company for one year.
Even Einhorn is no big fan of the operation, calling it “not a great business” at the conference, but investing in it because it was profitable, didn’t have debt and, most importantly, owned a ton of real estate. Its stores are generally located in good malls and attract a slightly older customer, making it somewhat less vulnerable to the shift online.
“Fifty decades later” is 500 years...