Citi Trends Announces First Quarter Fiscal 2024 Results
Total year-over-year sales growth of 3.7% to
Comparable sales growth of 3.1%; Gross margin at 38.7%
Balance sheet continues to have ample liquidity and no debt
Company reiterates Fiscal 2024 EBITDA Outlook
Financial Highlights – First Quarter 2024
-
Total sales of
$186.3 million increased 3.7% vs. Q1 2023; comparable store sales, calculated on a shifted 13-week to 13-week basis, increased 3.1% compared to Q1 2023 - Gross margin of 38.7% vs. 36.7% as reported and 37.0% as adjusted* in Q1 2023
-
Operating loss of
$7.0 million , or$5.6 million as adjusted*, compared to an operating loss of$9.5 million or$7.9 million as adjusted* in Q1 2023 -
Adjusted EBITDA* loss of
$0.8 million compared to an adjusted* loss of$3.2 million in Q1 2023 -
Net loss per share was (
$0.42 ), or ($0.32 ) as adjusted*, compared to ($0.81 ), or ($0.66 ) as adjusted* in Q1 2023 - Closed 3 stores and remodeled 20 stores to end the quarter with 599 locations; remodeled an additional 15 stores Q2 2024 to date, resulting in 21% of the fleet in CTx format
-
Cash of
$58.2 million at quarter-end, with no debt and no borrowings under a$75 million credit facility - Exited Q1 2024 with an inventory increase of 4% vs. Q1 2023
Interim Chief Executive Officer Comments
Capital Return Program Update
In the first quarter of fiscal 2024, the Company did not repurchase any shares of its common stock. At the end of Q1 2024,
Fiscal 2024 Outlook
The Company’s updated fiscal 2024 outlook is as follows:
- Expecting full year comparable store sales growth of low to mid-single digits, a range slightly below our previous outlook
- Full year gross margin to expand by approximately 75 to 100 basis points, consistent with previous outlook
- SG&A dollars expected to increase by approximately 1.5% to 2.5%, slightly better than previous outlook from streamlined costs in a variety of areas
-
Full year EBITDA* planned to be in the range of
$4 million to$10 million , unchanged from previous outlook - The Company continues to plan to open up to 5 new stores, remodel approximately 40 stores and close 10 to 15 underperforming stores as part of its ongoing fleet optimization; expecting to end fiscal 2024 with approximately 595 stores
-
Full year capital expenditures are still expected to be approximately
$20 million
Investor Conference Call and Webcast
The live conference call can also be accessed by dialing (877) 407-0779. A replay of the conference call will be available until
During the conference call, the Company may discuss and answer questions concerning business and financial developments and trends that have occurred after quarter-end. The Company’s responses to questions, as well as other matters discussed during the call, may contain or constitute information that has not been disclosed previously.
*Non-GAAP Financial Measures
The historical non-GAAP financial measures discussed herein are reconciled to their corresponding GAAP measures at the end of this press release. The Company is unable to provide a full reconciliation of the forward-looking non-GAAP financial measure used in 2024 guidance without unreasonable effort because it is not possible to predict certain of its adjustment items with a reasonable degree of certainty. This information is dependent upon future events and may be outside of the Company’s control and its unavailability could have a significant impact on its financial results.
About
Forward-Looking Statements
All statements other than historical facts contained in this news release, including statements regarding the Company’s future financial results and position, business policy and plans, objectives and expectations of management for future operations and capital allocation expectations, are forward-looking statements that are subject to material risks and uncertainties. The words "believe," "may," "could," "plans," "estimate," “expects,” "continue," "anticipate," "intend," "expect," “upcoming,” “trend” and similar expressions, as they relate to the Company, are intended to identify forward-looking statements, although not all forward-looking statements contain such language. Statements with respect to earnings, sales or new store guidance are forward-looking statements. Investors are cautioned that any such forward-looking statements are subject to the finalization of the Company’s quarter-end financial and accounting procedures, are not guarantees of future performance or results, and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Actual results or developments may differ materially from those included in the forward-looking statements as a result of various factors which are discussed in our Annual Reports and Quarterly Reports on Forms 10-K and 10-Q, respectively, and any amendments thereto, filed with the
|
|
||||||||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) |
||||||||||||
|
(in thousands, except per share data) |
||||||||||||
|
First Quarter |
||||||||||||
|
2024 |
2023 |
2022 |
||||||||||
| Net sales |
$ |
186,289 |
|
$ |
179,688 |
|
$ |
208,215 |
|
|||
| Cost of sales (exclusive of depreciation shown separately below) |
|
(114,254 |
) |
|
(113,659 |
) |
|
(127,011 |
) |
|||
| Selling, general and administrative expenses |
|
(74,211 |
) |
|
(70,807 |
) |
|
(71,026 |
) |
|||
| Depreciation |
|
(4,793 |
) |
|
(4,681 |
) |
|
(5,445 |
) |
|||
| Gain on sale-leaseback |
|
- |
|
|
- |
|
|
34,920 |
|
|||
| (Loss) Income from operations |
|
(6,969 |
) |
|
(9,460 |
) |
|
39,653 |
|
|||
| Interest income |
|
849 |
|
|
1,023 |
|
|
- |
|
|||
| Interest expense |
|
(79 |
) |
|
(75 |
) |
|
(76 |
) |
|||
| (Loss) income before income taxes |
|
(6,199 |
) |
|
(8,512 |
) |
|
39,577 |
|
|||
| Income tax benefit (expense) |
|
2,773 |
|
|
1,876 |
|
|
(9,374 |
) |
|||
| Net (loss) income |
$ |
(3,426 |
) |
$ |
(6,635 |
) |
$ |
30,203 |
|
|||
| Basic net (loss) income per common share |
$ |
(0.42 |
) |
$ |
(0.81 |
) |
$ |
3.59 |
|
|||
| Diluted net (loss) income per common share |
$ |
(0.42 |
) |
$ |
(0.81 |
) |
$ |
3.59 |
|
|||
| Weighted average number of shares outstanding | ||||||||||||
| Basic |
|
8,253 |
|
|
8,182 |
|
|
8,407 |
|
|||
| Diluted |
|
8,253 |
|
|
8,182 |
|
|
8,407 |
|
|||
|
|
||||||||
|
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) |
||||||||
|
(in thousands) |
||||||||
|
|
|
|||||||
| Assets: | ||||||||
| Cash and cash equivalents |
$ |
58,169 |
$ |
88,707 |
||||
| Inventory |
|
119,014 |
|
114,322 |
||||
| Prepaid and other current assets |
|
17,815 |
|
16,054 |
||||
| Property and equipment, net |
|
53,352 |
|
57,383 |
||||
| Operating lease right of use assets |
|
226,918 |
|
252,435 |
||||
| Other noncurrent assets |
|
8,834 |
|
5,530 |
||||
| Total assets |
$ |
484,102 |
$ |
534,430 |
||||
| Liabilities and Stockholders' Equity: | ||||||||
| Accounts payable |
$ |
72,269 |
$ |
90,029 |
||||
| Accrued liabilities |
|
24,437 |
|
23,473 |
||||
| Current operating lease liabilities |
|
45,428 |
|
47,780 |
||||
| Other current liabilities |
|
841 |
|
912 |
||||
| Noncurrent operating lease liabilities |
|
184,463 |
|
209,594 |
||||
| Other noncurrent liabilities |
|
1,831 |
|
2,680 |
||||
| Total liabilities |
|
329,269 |
|
374,468 |
||||
| Total stockholders' equity |
|
154,832 |
|
159,962 |
||||
| Total liabilities and stockholders' equity |
$ |
484,101 |
$ |
534,430 |
||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited) |
||||||||||||
|
(in thousands, except per share data) |
||||||||||||
| The Company makes reference in this release to adjusted gross margin, adjusted operating income, adjusted net income, adjusted earnings per share and adjusted EBITDA. The Company believes these supplemental measures reflect operating results that are more indicative of the Company's ongoing operating performance while improving comparability to prior and future periods, and as such, may provide investors with an enhanced understanding of the Company's past financial performance and prospects for the future. This information is not intended to be considered in isolation or as a substitute for net income or earnings per diluted share prepared in accordance with generally accepted accounting principles (GAAP). | ||||||||||||
|
First Quarter |
||||||||||||
|
|
|
|||||||||||
| Reconciliation of Adjusted Operating (Loss) Income | ||||||||||||
| Operating loss |
$ |
(6,969 |
) |
$ |
(9,460 |
) |
||||||
| Cyber incident expenses |
|
— |
|
|
1,560 |
|
||||||
| Other non-recurring expenses |
|
1,380 |
|
|
— |
|
||||||
| Adjusted operating loss |
$ |
(5,589 |
) |
$ |
(7,900 |
) |
||||||
|
First Quarter |
||||||||||||
|
|
|
|||||||||||
| Reconciliation of Adjusted Diluted EPS | ||||||||||||
| Diluted loss per share |
$ |
(0.42 |
) |
$ |
(0.81 |
) |
||||||
| Cyber incident expenses |
|
— |
|
|
0.19 |
|
||||||
| Other non-recurring expenses |
|
0.17 |
|
|
— |
|
||||||
| Tax effect |
|
(0.07 |
) |
|
(0.04 |
) |
||||||
| Adjusted diluted loss per share |
$ |
(0.32 |
) |
$ |
(0.66 |
) |
||||||
|
First Quarter |
||||||||||||
|
|
|
|||||||||||
| Reconciliation of Adjusted EBITDA | ||||||||||||
| Net loss |
$ |
(3,426 |
) |
$ |
(6,635 |
) |
||||||
| Interest income |
|
(849 |
) |
|
(1,023 |
) |
||||||
| Interest expense |
|
79 |
|
|
75 |
|
||||||
| Income tax benefit |
|
(2,773 |
) |
|
(1,876 |
) |
||||||
| Depreciation |
|
4,793 |
|
|
4,681 |
|
||||||
| Cyber incident expenses |
|
— |
|
|
1,560 |
|
||||||
| Other non-recurring expenses |
|
1,380 |
|
|
— |
|
||||||
| Adjusted EBITDA |
$ |
(796 |
) |
$ |
(3,218 |
) |
||||||
|
First Quarter |
||||||||||||
|
|
|
|||||||||||
| Reconciliation of Adjusted Gross Margin | ||||||||||||
| Net sales |
$ |
186,289 |
|
$ |
179,688 |
|
||||||
| Cost of sales |
|
(114,254 |
) |
|
(113,659 |
) |
||||||
| Gross profit |
$ |
72,035 |
|
$ |
66,029 |
|
||||||
| Gross margin |
|
38.7 |
% |
|
36.7 |
% |
||||||
| Cyber incident expenses |
$ |
- |
|
$ |
513 |
|
||||||
| Adjusted gross profit |
$ |
72,035 |
|
$ |
66,542 |
|
||||||
| Adjusted gross margin |
|
38.7 |
% |
|
37.0 |
% |
||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20240604021473/en/
CitiTrendsIR@icrinc.com
Source: