Citi Trends Inc reported results for the 14-week and 53-week periods ended February 3, 2007.
Financial Highlights - 14 weeks ended February 3, 2007:
Net sales increased 30.9% to $126.8 million compared with $96.8 million for the 13-week period ended January 28, 2006. Comparable store sales, on a comparable weeks basis, increased 1.3% compared with a 22.8% increase in the prior year.
Relocated and expanded stores are included in the comparable store sales results. Net income increased 30.9% to $10.4 million compared with $7.9 million for the prior-year quarter. Earnings per diluted share increased 32.7% to $0.73 compared with $0.55 in the prior year quarter.
The Company's 2006 Fiscal Year, ending February 3, 2007, contains 53 weeks versus the normal 52 weeks, with the extra week falling in the fourth quarter. The 53rd week of 2006 contributed $10.1 million of sales and approximately $0.10 per share to the fourth quarter and year.
Financial Highlights - 53 weeks ended February 3, 2007:
Net sales increased 31.8% to $381.9 million compared with $289.8 million for the 52-week period ended January 28, 2006. Comparable store sales, on a comparable weeks basis, increased 8.2% compared with a 16.7% increase in the prior year. Net income increased 50.4% to $21.4 million compared with $14.2 million for the prior year. Earnings per diluted share increased 39.8% to $1.51 compared with $1.08 in the prior year.
Fiscal 2007 Outlook:
The Company reiterates its prior estimate for Fiscal 2007 earnings of between $1.73 and $1.77 per diluted share. This estimate is based upon a fiscal 2007 comparable store sales increase of low single digits, 14.3 million diluted shares outstanding, and the opening of 46 to 48 new stores. The new store openings in fiscal 2007 are expected to increase selling square footage by approximately 20%.
First Quarter 2007 Outlook:
The Company estimates First Quarter 2007 earnings of $0.44 to $0.49 per diluted share. The Company generated a comparable store sales increase of 21 percent during last year's First Quarter, making comparisons difficult for the year. Further, the 13-week first quarter of 2007 starts and ends one week later than last year's first quarter.
This calendar shift has the potential effect of reducing comparable store sales by up to 4%. As a result of last year's high comparable sales increase and the calendar shift, the Company expects some pressure on gross margin and de-leveraging of SG&A in the first quarter compared with last year.
The Company reminds investors of the complexity of accurately assessing future growth given the difficulty in predicting fashion trends, consumer preferences and general economic conditions and the impact of other business variables.
Citi Trends will host a conference call on March 21, 2007, at 5:00 p.m. EDT.
