Kirkland's experienced solid sales momentum in its stores and online during the first quarter of fiscal 2014 despite getting a slow start as a result of adverse weather. Even with a more promotional environment late in the quarter, sales remained strong and resulted in earnings performance at the high end of the company’s guidance.
Net sales for the quarter increased 6.9% to $108.3 million from $101.2 million in the prior-year quarter. Comparable-store sales for the quarter, including e-commerce sales, increased 5% compared with a decrease of 2.3% in the prior-year quarter.
Kirkland’s opened seven stores and closed seven during the first quarter, leaving the total number of stores at 324 at quarter end.
The company reported net income of $2.1 million, or $0.12 per diluted share, for the quarter, compared with net income of $1.8 million, or $0.10 per diluted share, for the prior-year quarter.
“The year thus far is proceeding according to our plan, and we continue to expect benefits for the balance of the year from our investments in store growth, merchandise systems, e-commerce and branding initiatives,” said president and CEO Robert Alderson.
Looking ahead, the company expects to achieve approximately 10% square footage growth for the full year, with 35 to 40 new store openings and 10 to 15 store closings. New store openings will be weighted more toward the second half of the year, and store closings will be weighted more toward the first half of the year.
Kirkland’s anticipates Total sales for the year to increase approximately 8% to 10% compared with fiscal 2013. This level of sales performance would imply a comparable-store sales increase of approximately 3% to 5% for fiscal 2014. The company expects earnings per share for the full year to be in the range of $0.90 to $1.00.
The company issued guidance for the second quarter ending Aug. 2, of a net loss of $0.03 to $0.06 per diluted share. It expects net sales to be in the range of $104 million to $105 million with a comparable-store sales increase in the range of 3% to 4%. During the second quarter, the company anticipates opening approximately eight stores and closing approximately two stores.