Third quarter total sales increased 10.1%;
comparable store sales up 7.4%
Quarterly earnings per share of $0.05 this
year versus $(0.06) loss last year
Citi Trends, Inc. (NASDAQ:CTRN) today reported results for the
third quarter of fiscal 2017.
Financial Highlights – Third quarter
ended October 28, 2017
Total sales in the third quarter ended October 28, 2017
increased 10.1% to $176.9 million compared with $160.7 million in
the third quarter ended October 29, 2016. Comparable store sales
increased 7.4% in the quarter.
The Company had net income of $0.6 million, or $0.05 per diluted
share, in the third quarter of 2017, compared with a net loss of
$(0.8) million, or $(0.06) per diluted share, in last year’s third
quarter.
During the third quarter, the Company opened five new stores,
relocated or expanded two stores, and closed one store.
Financial Highlights – First three
quarters ended October 28, 2017
Total sales in the first three quarters of fiscal 2017 increased
6.6% to $543.1 million compared with $509.7 million in the same
period of fiscal 2016. Comparable store sales increased 4.1% in the
first three quarters of this year.
The Company had net income of $9.3 million, or $11.1 million
when adjusted for proxy contest-related expenses*, in the first
three quarters of 2017, compared with $7.8 million in the same
period last year. Earnings per diluted share in the first three
quarters of 2017 were $0.65, or $0.77 when adjusted for proxy
contest-related expenses*, compared with $0.53 in the first three
quarters of 2016.
Bruce Smith, Acting Chief Executive Officer, commented, “We are
extremely pleased to report strong sales and operating results for
the third quarter. The momentum that we saw in recent quarters
continued at an accelerated pace in the third quarter and is being
driven by our delivery of fashion-right, value-priced merchandise
to our customers. Comparable store sales growth was consistently
strong throughout the quarter, with a 7% increase in August and 8%
increases in both September and October. Importantly, all five of
our major merchandise categories once again contributed to the
sales increases.
“In addition to 10% total sales growth in the third quarter, we
were pleased with an improvement in gross margin and significant
expense leverage, all of which led to operating margin expansion of
140 basis points and a $1.4 million increase in net income.
“We believe that we have entered the fourth quarter in a
high-quality, liquid inventory position. Early reads on the holiday
season have been positive, as comparable store sales for
the first three weeks of November have been up 7% on top of a
6% increase in the same three weeks last year.”
Investor Conference Call and
Webcast
Citi Trends will host a conference call today at 9:00 a.m. ET.
The number to call for the live interactive teleconference is
(212) 231-2932. A replay of the conference call will be
available until November 28, 2017, by dialing (402) 977-9140
and entering the passcode, 21861316.
The live broadcast of Citi Trends' conference call will be
available online at the Company's website, www.cititrends.com,
under the Investor Relations section, beginning today at 9:00 a.m.
ET. The online replay will follow shortly after the call and will
be available for replay for one year.
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 conference
call, may contain or constitute information that has not been
disclosed previously.
About Citi Trends
Citi Trends, Inc. is a value-priced retailer of urban fashion
apparel and accessories for the entire family. The Company operates
549 stores located in 31 states. Citi Trends’ website address is
www.cititrends.com. CTRN-G
*Non-GAAP Financial
Measure
The non-GAAP financial measures discussed herein are reconciled
to their corresponding GAAP measures at the end of this press
release.
Forward-Looking
Statements
All statements other than historical facts contained in this
news release, including statements regarding our future financial
results and position, business policy and plans, objectives of
management for future operations and our intentions and ability to
pay dividends and complete any share repurchase authorizations, are
forward-looking statements that are subject to material risks and
uncertainties. The words "believe," "may," "could," "plans,"
"estimate," "continue," "anticipate," "intend," "expect" and
similar expressions, as they relate to Citi Trends, are intended to
identify forward-looking statements, although not all
forward-looking statements contain such language. Statements with
respect to earnings 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 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 risks, consumer spending patterns, competition
within the industry, competition in our markets and the ability to
anticipate and respond to fashion trends. Any forward-looking
statements by the Company, with respect to earnings guidance, the
Company’s intention to declare and pay dividends, the repurchase of
shares pursuant to a share repurchase program, or otherwise, are
intended to speak only as of the date such statements are made.
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 CONSOLIDATED
STATEMENTS OF OPERATIONS (unaudited) (in thousands, except
per share data) Thirteen Weeks Ended
Thirteen Weeks Ended October 28, 2017 October 29,
2016 (unaudited) (unaudited) Net sales $ 176,943 $ 160,716
Cost of sales (exclusive of depreciation shown separately
below) (110,094 ) (100,386 ) Selling, general and administrative
expenses (61,118 ) (57,637 ) Depreciation (4,976 ) (4,223 ) Asset
impairment - (61 ) Income (loss) from
operations 755 (1,591 ) Interest income 216 146 Interest expense
(38 ) (39 ) Income (loss) before income taxes 933
(1,484 ) Income tax (expense) benefit (286 ) 648
Net income (loss) $ 647 $ (836 ) Basic net
income (loss) per common share $ 0.05 $ (0.06 ) Diluted net
income (loss) per common share $ 0.05 $ (0.06 )
Weighted average number of shares outstanding Basic 13,563
14,677 Diluted 13,614
14,677
Thirty-Nine Weeks Ended
Thirty-Nine Weeks Ended October 28, 2017 October
29, 2016 (unaudited) (unaudited) Net sales $ 543,098 $ 509,664
Cost of sales (exclusive of depreciation shown separately
below) (334,659 ) (313,345 ) Selling, general and administrative
expenses (181,439 ) (172,073 ) Depreciation (13,863 ) (12,961 )
Asset impairment (77 ) (282 ) Income from operations
13,060 11,003 Interest income 617 408 Interest expense (112
) (120 ) Income before income taxes 13,565 11,291 Income tax
expense (4,238 ) (3,510 ) Net income $ 9,327 $
7,781 Basic net income per common share $ 0.66
$ 0.53 Diluted net income per common share $ 0.65 $
0.53 Weighted average number of shares outstanding
Basic 14,221 14,649 Diluted
14,270 14,652
CITI TRENDS,
INC. CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
(in thousands) October 28, 2017
October 29, 2016 (unaudited) (unaudited) Assets: Cash and
cash equivalents $ 34,866 $ 36,956 Short-term investment securities
30,298 34,132 Inventory 133,245 130,752 Prepaid and other current
assets 16,405 18,570 Property and equipment, net 63,571 54,478
Long-term investment securities 26,117 29,183 Other noncurrent
assets 8,171 9,211 Total assets $ 312,673 $ 313,282
Liabilities and Stockholders' Equity: Accounts payable $
68,047 $ 59,098 Accrued liabilities 28,921 25,718 Other current
liabilities 1,913 1,974 Noncurrent liabilities 8,786
8,130 Total liabilities 107,667 94,920 Total stockholders'
equity 205,006 218,362 Total liabilities and
stockholders' equity $ 312,673 $ 313,282
CITI
TRENDS, INC. RECONCILIATION OF GAAP BASIS OPERATING
RESULTS TO ADJUSTED NON-GAAP OPERATING RESULTS
(unaudited) (in thousands, except per share data)
The Company makes reference in this
release to net income adjusted for proxy contest expenses and
earnings per diluted share adjusted for proxy contest expenses. The
Company believes that excluding proxy contest expenses and their
related tax effects from its financial results reflects operating
results that are more indicative of the Company's ongoing operating
performance while improving comparability to prior 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, earnings per common share, or
expense information prepared in accordance with generally accepted
accounting principles (GAAP).
Thirteen Weeks Ended October 28, 2017 As
Reported Adjustment (1) As Adjusted
(unaudited) (unaudited) (unaudited) Net sales
$ 176,943 $ - $ 176,943 Cost of sales (exclusive of
depreciation shown separately below) (110,094 ) - (110,094 )
Selling, general and administrative expenses (61,118 ) - (61,118 )
Depreciation (4,976 ) - (4,976 ) Asset impairment -
- - Income from
operations 755 - 755 Interest income 216 - 216 Interest expense
(38 ) - (38 )
Income before income taxes 933 - 933 Income tax expense (286
) - (286 ) Net income $
647 $ - $ 647
Basic net income per common share $ 0.05 $ 0.05
Diluted net income per common share $ 0.05 $ 0.05
Weighted average number of shares outstanding Basic
13,563 13,563 Diluted 13,614
13,614
Thirty-Nine Weeks Ended
October 28, 2017 As Reported Adjustment
(1) As Adjusted (unaudited) (unaudited)
(unaudited) Net sales $ 543,098 $ - $ 543,098 Cost of
sales (exclusive of depreciation shown separately below) (334,659 )
- (334,659 ) Selling, general and administrative expenses (181,439
) 2,516 (178,923 ) Depreciation (13,863 ) - (13,863 ) Asset
impairment (77 ) -
(77 ) Income from operations 13,060 2,516 15,576 Interest income
617 - 617 Interest expense (112 ) -
(112 ) Income before income taxes 13,565 2,516
16,081 Income tax expense (4,238 ) (786
)
(5,024 ) Net income $ 9,327 $ 1,730
$ 11,057 Basic net income per
common share $ 0.66 $ 0.78 Diluted net income per
common share $ 0.65 $ 0.77 Weighted average
number of shares outstanding Basic 14,221
14,221 Diluted 14,270 14,270
(1) Proxy contest expenses and related tax effects
View source
version on businesswire.com: http://www.businesswire.com/news/home/20171121005069/en/
Citi Trends, Inc.Bruce Smith, (912) 443-2075Acting Chief
Executive Officer,Chief Operating Officer andChief Financial
Officer
Citi Trends (NASDAQ:CTRN)
Historical Stock Chart
From Sep 2024 to Oct 2024
Citi Trends (NASDAQ:CTRN)
Historical Stock Chart
From Oct 2023 to Oct 2024