Kirkland’s plans to continue investing in its e-commerce business and anticipates executing a more aggressive approach to store growth, following strong third-quarter results.
The company reported net sales for the third quarter ended Nov. 2 of $106.1 million, a 9.8% increase from $96.7 million for the year-ago quarter. Comparable-store sales, including e-commerce sales, for the quarter increased 4.9% compared with a decrease of 4.7% in the year-ago quarter.
“Sales momentum was strong during the quarter as our fall and holiday seasonal merchandise performed well,” said president and CEO Robert Alderson. “We continued to see positive results from strong product margin, higher conversion and higher average ticket as our merchandise assortments are resonating well with customers. Traffic improved sequentially during the quarter, and early fourth quarter trends are similar. Our outlook for the fourth quarter remains upbeat, and we are optimistic about the further rollout of our branding initiatives as well as the introduction of our loyalty program, K Club.”
Kirkland’s opened 9 stores and closed 3 during the third quarter of fiscal 2013, bringing the total number of stores to 323 at quarter end.
As it heads into fiscal 2014, the company plans to continue building on its momentum with growth in sales, margin improvement, the execution of multichannel strategies and further investments in branding and e-commerce.
“We currently anticipate that our square footage growth will be at least 10% in the coming year. This early outlook reflects the intense foundational work we’ve done over the last three years, which has us well-positioned to grow the business,” added Alderson.
Based on its strong sales and earnings performance, the company has increased its full-year earnings range to $0.90 to 0.95 per diluted share from its previous range of $0.80 to $0.90 per diluted share.
For the fourth quarter, the company expects to open 8 stores and close 7 stores. For fiscal 2013, this represents 24 new store openings and 23 closings, a square footage increase of 3%.
The company expects total sales for the fourth quarter to range between $159 and $162 million. This implies a comparable store sales increase of 2 to 4%, when using a 13-week to 13-week comparison.
Kirkland's 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 324 stores in 35 states.