Citi Trends, Inc. (NASDAQ: CTRN) today reported results for the
second quarter of fiscal 2011.
Financial Highlights – Second quarter
ended July 30, 2011
Total sales in the second quarter ended July 30, 2011 increased
0.9% to $130.2 million compared with $129.0 million in the second
quarter ended July 31, 2010. Comparable store sales decreased 11.9%
in this year’s second quarter.
Net loss was $10.0 million, or $0.69 per diluted share, in the
second quarter of 2011, compared with a net loss of $0.6 million,
or $0.04 per diluted share, in last year’s second quarter. The
increase in this year’s net loss was a result of the negative
comparable store sales and a related need to take clearance
markdowns. In addition, non-cash impairment expense totaling $1.6
million was recorded in the second quarter of 2011 related to the
property and equipment at 21 underperforming stores, and selling,
general and administrative expenses include $0.6 million of
expenses incurred in connection with the previously announced
closing of the Savannah, Georgia distribution center.
The Company opened 9 stores, and relocated or expanded 4 others
in the second quarter of 2011, reaching a total store count of 482
at the end of the quarter. In addition, 10 stores were converted to
the new Citi Lights format in the quarter.
Financial Highlights – First half ended
July 30, 2011
Total sales in the first half of fiscal 2011 increased 2.9% to
$319.4 million compared with $310.4 million in the first half of
fiscal 2010. Comparable store sales decreased 8.9% in the first
half of this year. Net income decreased to $2.1 million compared
with $11.9 million in last year’s first half. Earnings per diluted
share were $0.14 in the first half of 2011 compared with $0.82 in
2010’s first half.
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) 231-2901. A replay of the conference call will be
available until August 24, 2011, by dialing (402) 977-9140 and
entering the passcode, 21533196. The live broadcast of the
quarterly conference call will be available online at the Company's
website, www.cititrends.com, as well as
http://ir.cititrends.com/events.cfm, beginning today at 9:00 a.m.
ET. The online replay will follow shortly after the call and
continue through August 24, 2011.
During the conference call, the Company may discuss and answer
questions concerning business and financial developments and
trends. 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. After opening 4
stores thus far in August 2011, the Company currently operates 486
stores located in 27 states. Citi Trends’ 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
results and 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," "plans," "estimate," "continue,"
"anticipate," "intend," "expect" and similar expressions, as they
relate to Citi Trends, are intended to identify forward-looking
statements. 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 quarterly 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 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 STATEMENTS OF
OPERATIONS (unaudited) (in thousands, except per share
data) Thirteen Weeks Ended
Thirteen Weeks Ended July 30, 2011
July 31, 2010 (unaudited) (unaudited) Net sales $ 130,233 $
129,042 Cost of sales 86,781 80,762
Gross profit 43,452 48,280 Selling, general and administrative
expenses (1) 50,688 44,426 Depreciation and amortization 6,351
4,769 Asset impairment 1,609 - Loss
from operations (15,196 ) (915 ) Interest income 65 44 Interest
expense (6 ) (5 ) Loss before income tax benefit
(15,137 ) (876 ) Income tax benefit (5,106 ) (309 )
Net loss $ (10,031 ) $ (567 ) Basic net loss per common
share $ (0.69 ) $ (0.04 ) Diluted net loss per common share $ (0.69
) $ (0.04 ) Weighted average shares used to compute basic
net loss per share 14,596 14,515
Weighted average shares used to compute diluted net loss per share
14,596 14,515
Twenty-Six Weeks Ended Twenty-Six Weeks Ended July
30, 2011 July 31, 2010 (unaudited) (unaudited) Net sales
$ 319,401 $ 310,448 Cost of sales 200,880
189,778 Gross profit 118,521 120,670 Selling, general and
administrative expenses (1) 101,760 92,876 Depreciation and
amortization 11,935 9,519 Asset impairment 1,609
- Income from operations 3,217 18,275 Interest income
119 99 Interest expense (10 ) (9 ) Income before
income tax expense 3,326 18,365 Income tax expense 1,264
6,483 Net income $ 2,062 $ 11,882
Basic net income per common share $ 0.14 $
0.82 Diluted net income per common share $ 0.14 $
0.82 Weighted average shares used to compute basic
net income per share 14,575 14,486
Weighted average shares used to compute diluted net income per
share 14,585 14,510 (1)
Includes $615 of expenses incurred in connection with the closing
of a distribution center.
CITI TRENDS,
INC. CONDENSED BALANCE SHEETS (unaudited) (in
thousands) July 30, 2011 July 31, 2010
(unaudited) (unaudited) Assets: Cash and cash equivalents $ 49,496
$ 84,636 Short-term investment securities - 3,148 Inventory 122,313
107,556 Prepaid and other current assets 17,846 16,742 Assets held
for sale 1,415 - Property and equipment, net 94,132 73,434
Long-term investment securities 19,968 - Other noncurrent assets
4,671 4,849 Total assets $ 309,841
$ 290,365 Liabilities and Stockholders'
Equity: Accounts payable $ 61,555 $ 58,942 Accrued liabilities
27,179 24,685 Other current liabilities 1,669 1,909 Noncurrent
liabilities 10,750 9,253 Total
liabilities 101,153 94,789 Total stockholders' equity
208,688 195,576 Total liabilities and
stockholders' equity $ 309,841 $ 290,365
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