Citi Trends Announces Second Quarter 2006 Results
SAVANNAH, Ga., Aug 16, 2006 /PRNewswire-FirstCall via COMTEX News Network/ -- Citi Trends, Inc. (Nasdaq: CTRN) today reported results for the second quarter ended July 29, 2006.
Financial Highlights -- 13 weeks ended July 29, 2006
Total net sales increased 28.4% to $76.3 million compared with $59.5 million for the 13-week period ended July 30, 2005. Comparable store sales increased 7.3% compared with a 11.5% increase in the prior-year quarter. Relocated and expanded stores are included in the comparable store sales results. Net income increased 235% to $1.3 million compared with $381,000 for the prior-year quarter. Earnings per diluted share increased 200% to $0.09 compared with $0.03 in the prior-year quarter. Last year second quarter results included a one-time fee of $1.2 million pre-tax, or $0.06 per diluted share, paid by the Company to Hampshire Equity Partners to terminate its management consulting agreement with the Company.
For the second quarter, the Company opened 3 stores, reaching a total store count of 253 at the end of the quarter. During the third and fourth quarters, the Company plans to open an additional 22 to 25 stores bringing the end of year store count to 275 to 278.
Fiscal 2006 Outlook
The Company is revising its fiscal 2006 earnings guidance to a range of $1.37 to $1.41 per diluted share. This guidance is based upon an anticipated fiscal 2006 comparable store sales increase of between 3% and 5%, the opening of 40 to 43 new stores, with no closings planned, and 14.1 million diluted shares outstanding. This store opening schedule in fiscal 2006 is expected to increase selling square footage by approximately 20%, consistent with the Company's previously issued guidance.
The Company reminds investors of the complexity of accurately assessing future growth given the difficulty in predicting fashion trends, consumer preferences and general economic conditions and the impact of other business variables.
Investor Conference Call and Webcast
Citi Trends will host a conference call on August 16, 2006, at 5:00 p.m. EDT. The number to call for the live interactive teleconference is (913) 981- 5519. A replay of the conference call will be available until August 23, 2006, by dialing (719) 457-0820 and entering the passcode, 4168286.
The live broadcast of Citi Trends' quarterly conference call will be available online at the Company's website, www.cititrends.com, as well as http://ir.cititrends.com/medialist.cfm on August 16, 2006, beginning at 5:00 p.m. EDT. The online replay will follow shortly after the call and continue for two weeks.
About Citi Trends
Citi Trends, Inc. is a value-priced retailer of urban fashion apparel and accessories for the entire family. The Company currently operates 256 stores located in 16 states in the South, Southeast, Midwest and Mid-Atlantic regions, and our website address is www.cititrends.com. CTRN-E
Forward-Looking Statements
All statements other than historical facts contained in this news release, including statements regarding our future financial position, business policy and plans and objectives of management for future operations, are forward- looking statements that are subject to material risks and uncertainties. The words "believe," "may," "could," "estimate," "continue," "anticipate," "intend," "expect," "plan" and similar expressions, as they relate to Citi Trends, are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance or results and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, and that actual results or developments may differ materially from those in the forward-looking statements as a result of various factors which are discussed in Citi Trends, Inc. filings with the Securities and Exchange Commission. These risks and uncertainties include, but are not limited to, uncertainties relating to economic conditions, growth and expansion risks, consumer spending patterns, competition within the industry, competition in our markets and the ability to anticipate and respond to fashion trends. Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the Securities and Exchange Commission, Citi Trends does not undertake to publicly update any forward-looking statements in this news release or with respect to matters described herein, whether as a result of any new information, future events or otherwise.
CITI TRENDS INC.
CONDENSED STATEMENT OF INCOME
(unaudited)
(in $000's, except share and per share data)
Thirteen Weeks Ended
Jul. 29, 2006 Jul. 30, 2005
Net sales $76,330 $59,449
Cost of sales 48,112 37,682
Gross profit 28,218 21,767
Selling, general and administrative expenses 26,681 21,271
Income from operations 1,537 496
Interest income 457 136
Interest expense (38) (81)
Income before provision for income taxes 1,956 551
Provision for income taxes 680 170
Net income $1,276 $381
Net income per share, basic $0.09 $0.03
Net income per share, diluted $0.09 $0.03
Weighted average shares used to
compute net income per share, basic 13,516,060 11,925,307
Weighted average shares used to
compute net income per share, diluted 14,099,565 13,587,400
Twenty-six Weeks Ended
Jul. 29, 2006 Jul. 30, 2005
Net sales $168,011 $123,066
Cost of sales 103,484 76,166
Gross profit 64,527 46,900
Selling, general and administrative expenses 52,922 41,029
Income from operations 11,605 5,871
Interest income 954 187
Interest expense (79) (242)
Income before provision for income taxes 12,480 5,816
Provision for income taxes 4,310 2,170
Net income $8,170 $3,646
Net income per share, basic $0.61 $0.34
Net income per share, diluted $0.58 $0.30
Weighted average shares used to
compute net income per share, basic 13,481,836 10,610,154
Weighted average shares used to
compute net income per share, diluted 14,068,831 12,230,180
CITI TRENDS, INC.
CONDENSED BALANCE SHEETS
(in $000's)
Jul. 29, 2006 Jan. 28, 2006
(unaudited)
Assets
Cash and cash equivalents $8,294 $9,079
Marketable securities 45,375 54,458
Inventory 67,076 54,021
Other assets 10,834 6,306
Property and equipment, net 26,287 23,426
Total assets $157,866 $147,290
Liabilities and Stockholders' Equity
Borrowings under line of credit $- $-
Accounts payable and accrued liabilities 50,872 57,667
Other liabilities 6,575 5,874
Total stockholders' equity 100,419 83,749
Total liabilities and stockholders' equity $157,866 $147,290
Citi Trends Inc.
Regulation G Reconciliation
Quarter ended
July 30, 2005 % to Sales
Selling, general and administrative
expenses, as reported $21,270,958 35.8%
Items to Reconcile to GAAP
Termination fee paid to Hampshire
Equity Partners 1,200,000 2.0%
Selling, general and administrative
expenses, as adjusted $20,070,958 33.8%
Quarter ended
July 30, 2005
Diluted earnings per share, as reported $0.03
Items to Reconcile to GAAP
Diluted earnings per share impact of
termination fee paid to Hampshire
Equity Partners 0.06
Diluted earnings per share, as adjusted $0.09
SOURCE Citi Trends, Inc.
Tom Stoltz, Chief Financial Officer, +1-912-443-2075, or Ed Anderson, Chairman and Chief Executive Officer, +1-912-443-3705, both of Citi Trends, Inc.
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