| May 23, 2013 |
| Kirkland's Reports First Quarter 2013 Results |
Kirkland's, Inc. (NASDAQ: KIRK) today reported financial results for the
13-week period ended May 4, 2013.
Net sales for the 13 weeks ended May 4, 2013, increased 3.5% to $101.2
million compared with $97.8 million for the prior-year quarter.
Comparable store sales, including e-commerce sales, for the first
quarter of fiscal 2013 decreased 2.3% compared with a decrease of 1.2%
in the prior-year quarter. Kirkland's opened 1 store and closed 7 during
the first quarter of fiscal 2013, bringing the total number of stores to
317 at quarter end.
The Company reported net income of $1.8 million, or $0.10 per diluted
share, for the first quarter of fiscal 2013 compared with net income of
$2.0 million, or $0.10 per diluted share, for the first quarter of
fiscal 2012 and previous net income guidance of $0.02 to $0.05 per
diluted share.
Robert Alderson, Kirkland's President and Chief Executive Officer, said,
"Although we had a slow start to February consistent with our cautious
outlook for the first half of the year, we experienced an improvement in
trends later in the quarter. The better sales and margin performance in
the latter weeks of the quarter exceeded our expectations and has
modestly improved our outlook. However, there is still much work to do
in firmly establishing a positive merchandising trend as well as
leveraging our ongoing investments in technology, growing e-commerce,
improving traffic, focusing on tight expense controls and executing our
new branding initiatives."
Updated Fiscal 2013 Outlook |
|
|
|
| | Store Base: | | | | |
For the 52-week period ending February 1, 2014 ("fiscal 2013"), the
Company expects to open approximately 25 new stores and close
approximately 15 stores. New store openings will be weighted more
toward the second and third quarters of the year, while closings
will be weighted more toward the first half of the year.
| | | | | |
| Sales: | | | | |
Total sales for the 52-week fiscal 2013 are expected to increase
approximately 3% to 5% compared with 53-week fiscal 2012. This level
of total sales performance implies comparable store sales results of
flat to a slight increase for fiscal 2013.
| | | | | |
| Margins: | | | | |
Based on the current outlook, inbound freight costs should be higher
for the second quarter, but improve in the second half of the year
offsetting the negative first half margin impact. A strict focus on
operating expense controls, combined with a more conservative store
opening plan, should position the Company to better leverage any
upside to its current revenue projections. However, the Company
expects investments in key personnel, as well as modest increases in
marketing and e-commerce expenses to offset some of the expense
efficiencies.
| | | | | |
| Earnings: | | | | |
Based on the above assumptions, the Company expects fiscal 2013
earnings per share to be in the range of $0.75 to $0.85. The Company
expects its full year effective tax rate to be approximately 38.5%.
| | | | | |
| Cash Flow: | | | | |
Capital expenditures in fiscal 2013 are estimated to range between
$20 million and $23 million. Based on the above assumptions, the
Company expects to be cash flow positive in fiscal 2013.
| | | | | |
|
Second Quarter Fiscal 2013 Outlook
For the second quarter ending August 3, 2013, the Company expects a net
loss of $0.08 to $0.11 per diluted share compared with a net loss of
$0.11 per share in the prior-year quarter. Net sales are expected to be
$97 million to $98 million, with a nominal decrease to a nominal
increase in comparable store sales. The Company expects to open
approximately 6 stores and close approximately 5 stores during the
quarter.
Investor Conference Call and Web Simulcast
Kirkland's will host a conference call at 11:00 a.m. ET today to discuss
the first quarter results. The number to call for the interactive
teleconference is (212) 231-2919. A replay of the conference call will
be available through Thursday, May 30, 2013, by dialing (402) 977-9140
and entering the confirmation number, 21646240.
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=93882
on May 23, 2013, 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 315 stores in 35 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.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, including the Company's Annual Report on Form 10-K filed on
April 18, 2013.Kirkland's disclaims any obligation to update any
such factors or to publicly announce results of any revisions to any of
the forward-looking statements contained herein to reflect future events
or developments. |
| | KIRKLAND'S, INC. | | UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF INCOME | | (dollars in thousands, except per share amounts) | |
| |
| |
|
| 13-Week Period Ended | | | | May 4, |
|
| April 28, | | | | 2013 | | | 2012 | | | | | | |
| |
Net sales
| | |
$
|
101,233
| | |
$
|
97,788
| | |
Cost of sales
| | |
|
61,827
| | |
|
59,319
|
| |
Gross profit
| | | |
39,406
| | | |
38,469
| | | | | | | |
| |
Operating expenses:
| | | | | | | |
Operating expenses
| | | |
32,779
| | | |
32,284
| | |
Depreciation
| | |
|
3,791
| | |
|
3,015
|
| |
Operating income
| | | |
2,836
| | | |
3,170
| | | | | | | |
| |
Other (income) expense, net
| | |
|
6
| | |
|
(3
|
)
| |
Income before income taxes
| | | |
2,830
| | | |
3,173
| | |
Income tax expense
| | |
|
1,057
| | |
|
1,218
|
| |
Net income
| | |
$
|
1,773
| | |
$
|
1,955
|
| | | | | | |
| |
Earnings per share:
| | | | | | | |
Basic
| | |
$
|
0.10
| | |
$
|
0.11
|
| |
Diluted
| | |
$
|
0.10
| | |
$
|
0.10
|
| | | | | | |
| |
Shares used to calculate earnings per share:
| | | | | | | |
Basic
| | |
|
17,083
| | |
|
18,269
|
| |
Diluted
| | |
|
17,433
| | |
|
18,772
|
| | | | | | |
|
|
| | KIRKLAND'S, INC. | | UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS | | (dollars in thousands) | |
| |
| |
|
| May 4, |
|
| February 2, |
|
| April 28, | | | | 2013 | | | 2013 | | | 2012 | ASSETS | | | | | | | | | | | | | | | | | | |
| |
Current assets:
| | | | | | | | | | |
Cash and cash equivalents
| | |
$
|
74,111
| | |
$
|
67,797
| | |
$
|
73,162
| |
Inventories, net
| | | |
47,889
| | | |
49,577
| | | |
47,484
| |
Income taxes receivable
| | | |
1,015
| | | |
-
| | | |
-
| |
Deferred income taxes
| | | |
1,638
| | | |
1,602
| | | |
1,725
| |
Other current assets
| | |
|
6,576
| | |
|
9,370
| | |
|
8,118
| |
Total current assets
| | | |
131,229
| | | |
128,346
| | | |
130,489
| | | | | | | | | |
| |
Property and equipment, net
| | | |
76,964
| | | |
78,499
| | | |
61,414
| |
Non-current deferred income taxes
| | | |
-
| | | |
-
| | | |
1,150
| |
Other assets
| | |
|
1,680
| | |
|
1,559
| | |
|
1,496
| | | | | | | | | |
| |
Total assets
| | |
$
|
209,873
| | |
$
|
208,404
| | |
$
|
194,549
| | | | | | | | | |
| | | | | | | | | |
| | LIABILITIES AND SHAREHOLDERS' EQUITY | | | | | | | | | | | | | | | | | | |
| |
Current liabilities:
| | | | | | | | | | |
Accounts payable
| | |
$
|
20,933
| | |
$
|
21,642
| | |
$
|
18,050
| |
Income taxes payable
| | | |
-
| | | |
520
| | | |
1,931
| |
Other current liabilities
| | |
|
21,719
| | |
|
21,009
| | |
|
18,637
| |
Total current liabilities
| | | |
42,652
| | | |
43,171
| | | |
38,618
| | | | | | | | | |
| |
Non-current deferred income taxes
| | | |
3,057
| | | |
3,128
| | | |
-
| |
Deferred rent and other long-term liabilities
| | |
|
43,778
| | |
|
44,230
| | |
|
38,633
| |
Total liabilities
| | |
|
89,487
| | |
|
90,529
| | |
|
77,251
| | | | | | | | | |
| |
Net shareholders' equity
| | |
|
120,386
| | |
|
117,875
| | |
|
117,298
| | | | | | | | | |
| |
Total liabilities and shareholders' equity
| | |
$
|
209,873
| | |
$
|
208,404
| | |
$
|
194,549
| | | | | | | | | | | | |
|
|
| | KIRKLAND'S, INC. | | UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS | | (dollars in thousands) | |
| |
| |
|
| 13-Week Period Ended | | | | May 4, |
|
| April 28, | | | | 2013 | | | 2012 | | Net cash provided by (used in): | | | | | | | | | | | | |
| |
Operating activities
| | |
$
|
8,561
| | | |
$
|
(2,733
|
)
| |
Investing activities
| | | |
(2,322
|
)
| | | |
(4,109
|
)
| |
Financing activities
| | |
| 75 |
| | |
| (3,119 | ) | | | | | | |
| | Cash and cash equivalents: | | | | | | | |
Net increase (decrease)
| | | |
6,314
| | | | |
(9,961
|
)
| |
Beginning of the period
| | |
| 67,797 |
| | |
| 83,123 |
| |
End of the period
| | | $ | 74,111 |
| | | $ | 73,162 |
| | | | | | |
|
Kirkland's, Inc.
W. Michael Madden, 615-872-4800
Senior Vice
President & CFO
or
Corporate Communications, Inc.
Tripp
Sullivan, 615-324-7335
|
|
