| Nov 18, 2011 |
| Kirkland's Reports Third Quarter Results |
Kirkland's, Inc. (NASDAQ: KIRK) today reported financial results for the
13-week and 39-week periods ended October 29, 2011.
Net sales for the 13-week period ended October 29, 2011, were $97.1
million compared with $92.7 million for the 13-week period ended October
30, 2010. Comparable store sales for the third quarter of fiscal 2011
decreased 3.6% compared with a 2.4% decrease in the prior-year quarter.
The Company opened 13 stores and closed 6 stores during the third
quarter of 2011, bringing the total number of stores to 301 as of
quarter's end.
Net sales for the 39-week period ended October 29, 2011, were $281.2
million compared with $275.7 million for the 39-week period ended
October 30, 2010. Comparable store sales for the 39 weeks ended October
29, 2011, decreased 6.7% compared with an increase of 3.5% in the
prior-year period. The Company opened 23 stores and closed 22 stores
during the 39-week period ended October 29, 2011.
The Company reported net income of $1.2 million, or $0.06 per diluted
share, for the third quarter of fiscal 2011 compared with net income of
$2.3 million, or $0.11 per diluted share, for the third quarter of
fiscal 2010.
For the 39-week period ended October 29, 2011, the Company reported net
income of $3.9 million, or $0.19 per diluted share, compared with net
income of $12.0 million, or $0.59 per diluted share, for the 39-week
period ended October 30, 2010.
Robert Alderson, Kirkland's President and Chief Executive Officer, said,
"We were pleased to realize improvement in our sales results for the
third quarter, which were higher than originally anticipated due to
better trends in the second half of the quarter. We experienced
sequential improvement in our merchandise margin during the quarter,
resulting in better-than-expected earnings results.
"During the quarter, we saw improvement in some of our important
merchandising categories; however, we have more work to do. Inventories
remain in good shape and well-balanced after successful execution in the
third quarter. New store openings continue to produce strong initial
sales results. Despite the delays that we have experienced in accessing
space this year, we have a strong start to the 2012 store class. Our top
priority is to enter fiscal 2012 with improving sales and earnings
momentum, and thus far we are on track with that plan."
Stock Repurchase Plan
During the third quarter of fiscal 2011, the Company repurchased 837,803
shares of common stock for a total of $8.0 million, or an average price
of $9.50 per share, and has repurchased an additional 80,548 shares
since quarter end for a total of 918,351 shares. The Company has $31.1
million remaining under its repurchase authorization.
Fourth Quarter and Fiscal 2011 Outlook Store Growth: |
|
The Company expects to open approximately 8 net new stores in the
fourth quarter of fiscal 2011, representing 9 net new stores for the
year and square footage growth of approximately 10%.
| |
| Net Sales: | |
The Company expects net sales to be in the range of $142 million to
$145 million in the fourth quarter of fiscal 2011, which would imply
a comparable store sales decline of 2% to 5%. Total net sales for
fiscal 2011 would range from $423 million to $426 million.
| |
| Earnings: | |
The Company expects to report earnings of $0.65 to $0.70 per diluted
share in the fourth quarter of fiscal 2011, which would equate to
earnings of $0.84 to $0.89 per diluted share for the full fiscal
year 2011.
| |
| Cash Flow: | |
Capital expenditures are estimated to range between $25 million
and $27 million for fiscal 2011. Cash and cash equivalents as of
October 29, 2011 amounted to $60.3 million. Excluding the impact
of potential share repurchase activity in the fourth quarter, the
Company expects to have approximately $85 million to $90 million
in cash and cash equivalents at year-end fiscal 2011.
|
Investor Conference Call and Web Simulcast
Kirkland's will host a conference call today, at 11:00 a.m. ET to
discuss its results of operations for the third quarter of fiscal 2011.
The number to call for the interactive teleconference is (212) 231-2905.
A replay of the conference call will be available through Friday,
November 25, 2011, by dialing (402) 977-9140 and entering the
confirmation number, 21543983.
A live broadcast of Kirkland's quarterly conference call will be
available online at the Company's website www.kirklands.com
under Investor Relations or http://www.videonewswire.com/event.asp?id=83337
on November 18, 2011, beginning at 11:00 a.m. ET. The online replay will
follow shortly after the call and continue for one year.
About Kirkland's, Inc.
Kirkland's, Inc. was founded in 1966 and is a specialty retailer of home
décor in the United States. Although originally focused in the
Southeast, the Company has grown beyond that region and currently
operates 306 stores in 30 states. The Company's stores present a broad
selection of distinctive merchandise, including framed art, mirrors,
candles, lamps, picture frames, accent rugs, garden accessories and
artificial floral products. The Company's stores also offer an extensive
assortment of gifts, as well as seasonal merchandise. More information
can be found at www.kirklands.com.
Forward-Looking Statements Except for historical information contained herein, the statements in
this release are forward-looking and made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.Although
Kirkland's believes that the Forward-looking statements in this release
involve reasonable expectations, it can give no assurance that such
expectations will prove to be correct and such statements of expectation
should not be unduly relied upon. Forward-looking statements involve
known and unknown risks and uncertainties, which may cause Kirkland's
actual results to differ materially from forecasted results.Those
risks and uncertainties include, among other things, the competitive
environment in the home décor industry in general and in Kirkland's
specific market areas, inflation, product availability and growth
opportunities, seasonal fluctuations, and economic conditions in general.Those and other risks are more fully described in Kirkland's filings
with the Securities and Exchange Commission.Kirkland's disclaims
any obligation to update any forward-looking statements or to publicly
announce results of any revisions to any of the forward-looking
statements contained herein to reflect future events or developments.
Any factor described in this release or in any document referred to in
this release could, by itself or together with one or more other
factors, adversely affect Kirkland's business, earnings and/or financial
condition. |
| | KIRKLAND'S, INC. | | UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF INCOME | | (numbers in thousands, except per share amounts) | |
| |
| | | | | |
| | | 13 Week Period Ended | | | October 29, | | October 30, | | | 2011 | | 2010 | | | | |
| |
Net sales
| |
$
|
97,071
| |
$
|
92,725
| | |
Cost of sales
| |
|
60,938
| |
|
56,732
|
| |
Gross profit
| | |
36,133
| | |
35,993
| | | | | |
| |
Operating expenses:
| | | | | |
Operating expenses
| | |
31,295
| | |
29,081
| | |
Depreciation
| |
|
2,914
| |
|
3,146
|
| |
Operating income
| | |
1,924
| | |
3,766
| | | | | |
| |
Other expense (income), net
| |
|
4
| |
|
(29
|
)
| |
Income before income taxes
| | |
1,920
| | |
3,795
| | |
Income tax provision
| |
|
673
| |
|
1,516
|
| |
Net income
| |
$
|
1,247
| |
$
|
2,279
|
| | | | |
| |
Earnings per share:
| | | | | |
Basic
| |
$
|
0.06
| |
$
|
0.11
|
| |
Diluted
| |
$
|
0.06
| |
$
|
0.11
|
| | | | |
| |
Shares used to calculate earnings per share:
| | | | | |
Basic
| |
|
19,918
| |
|
19,889
|
| |
Diluted
| |
|
20,204
| |
|
20,522
|
| | | | |
|
|
| | KIRKLAND'S, INC. | | UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF INCOME | | (numbers in thousands, except per share amounts) | |
| |
| | | | | |
| | | 39 Week Period Ended | | | October 29, | | October 30, | | | 2011 | | 2010 | | | | |
| |
Net sales
| |
$
|
281,175
| | |
$
|
275,694
| | |
Cost of sales
| |
|
176,108
|
| |
|
164,243
|
| |
Gross profit
| | |
105,067
| | | |
111,451
| | | | | |
| |
Operating expenses:
| | | | | |
Operating expenses
| | |
89,729
| | | |
82,374
| | |
Depreciation
| |
|
8,888
|
| |
|
9,294
|
| |
Operating income
| | |
6,450
| | | |
19,783
| | | | | |
| |
Other income, net
| |
|
(1
|
)
| |
|
(148
|
)
| |
Income before income taxes
| | |
6,451
| | | |
19,931
| | |
Income tax provision
| |
|
2,514
|
| |
|
7,882
|
| |
Net income
| |
$
|
3,937
|
| |
$
|
12,049
|
| | | | |
| |
Earnings per share:
| | | | | |
Basic
| |
$
|
0.20
|
| |
$
|
0.61
|
| |
Diluted
| |
$
|
0.19
|
| |
$
|
0.59
|
| | | | |
| |
Shares used to calculate earnings per share:
| | | | | |
Basic
| |
|
19,930
|
| |
|
19,839
|
| |
Diluted
| |
|
20,498
|
| |
|
20,588
|
| | | | |
|
|
| | KIRKLAND'S, INC. | | UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS | | (dollars in thousands) | |
| | | | |
| |
| |
| | | | | | | | October 29, | | January 29, | | October 30, | | | | | | | 2011 | | 2011 | | 2010 | | ASSETS | | | | | | | | | | | | | | | | | | | |
| |
Current assets:
| | | | | | | | | | |
Cash and cash equivalents
| | |
$
|
60,343
| |
$
|
91,222
| |
$
|
58,831
| |
Inventories, net
| | | | | |
59,940
| | |
44,452
| | |
56,851
| |
Income taxes receivable
| | | | |
2,664
| | |
-
| | |
3,332
| |
Deferred income taxes
| | | | |
2,174
| | |
3,528
| | |
4,013
| |
Other current assets
| | | |
|
11,176
| |
|
7,468
| |
|
8,321
| |
Total current assets
| | | | |
136,297
| | |
146,670
| | |
131,348
| | | | | | | | | | |
| |
Property and equipment, net
| | | |
58,366
| | |
46,231
| | |
45,125
| |
Non-current deferred income taxes
| | | |
2,412
| | |
1,440
| | |
3,656
| |
Other assets
| | | | |
|
1,176
| |
|
736
| |
|
684
| | | | | | | | | | |
| |
Total assets
| | | | |
$
|
198,251
| |
$
|
195,077
| |
$
|
180,813
| | | | | | | | | | |
| | | | | | | | | | |
| | LIABILITIES AND SHAREHOLDERS' EQUITY | | | | | | | | | | | | | | | | |
| |
Current liabilities:
| | | | | | | | | | |
Accounts payable
| | | |
$
|
24,975
| |
$
|
20,236
| |
$
|
25,923
| |
Income taxes payable
| | | | |
-
| | |
1,289
| | |
-
| |
Other current liabilities
| | | |
|
21,145
| |
|
24,364
| |
|
21,625
| |
Total current liabilities
| | | | |
46,120
| | |
45,889
| | |
47,548
| | | | | | | | | | |
| |
Deferred rent and other long-term liabilities
| |
|
35,023
| |
|
30,899
| |
|
30,332
| |
Total liabilities
| | | | |
|
81,143
| |
|
76,788
| |
|
77,880
| | | | | | | | | | |
| |
Net shareholders' equity
| | | |
|
117,108
| |
|
118,289
| |
|
102,933
| | | | | | | | | | |
| |
Total liabilities and shareholders' equity
| |
$
|
198,251
| |
$
|
195,077
| |
$
|
180,813
| | | | | | |
|
|
| | KIRKLAND'S, INC. | | UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS | | (dollars in thousands) | |
| |
| |
| | | | | 39 Week Period Ended | | | | October 29, | | October 30, | | | | 2011 | | 2010 | | Net cash provided by (used in): | | | | | |
Operating activities
| |
$
|
(1,917
|
)
| |
$
|
(320
|
)
| |
Investing activities
| | |
(21,175
|
)
| | |
(17,810
|
)
| |
Financing activities
| |
| (7,787 | ) | |
| 549 |
| | | | | |
| | Cash and cash equivalents: | | | | | |
Net decrease
| | |
(30,879
|
)
| | |
(17,581
|
)
| |
Beginning of the period
| |
| 91,222 |
| |
| 76,412 |
| |
End of the period
| | $ | 60,343 |
| | $ | 58,831 |
| | | | | | | | | |
|
Kirkland's, Inc.
W. Michael Madden, 615-872-4800
Senior Vice
President & CFO
or
Corporate Communications, Inc.
Tripp
Sullivan, 615-324-7335
|
|
