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Citi Trends Announces Fourth Quarter and Fiscal 2012 Sales and Estimates Net Loss for the Fourth Quarter



  Citi Trends Announces Fourth Quarter and Fiscal 2012 Sales and Estimates Net
  Loss for the Fourth Quarter

Business Wire

SAVANNAH, Ga. -- February 13, 2013

Citi Trends, Inc. (NASDAQ: CTRN) today reported unaudited sales results for
the fourth quarter and fiscal year ended February 2, 2013.

The Company’s 2012 fiscal year contained 53 weeks compared with the
traditional 52 weeks in fiscal 2011. Accordingly, comparisons of total sales
for the fourth quarter and full year of fiscal 2012 to the same periods in
2011 are affected by an extra week of sales in 2012. However, for comparable
store sales, the Company is reporting on a comparable weeks basis (e.g. the 14
weeks ended February 2, 2013 compared to the 14 weeks ended February 4, 2012).

Total sales in the 14-week quarter ended February 2, 2013 decreased 1.5% to
$175.7 million compared with $178.4 million in the 13-week quarter ended
January 28, 2012. The extra week contributed $8.8 million to total sales in
fiscal 2012.

For the year, total sales in the 53 weeks ended February 2, 2013 increased
2.2% to $654.7 million compared with $640.8 million in the 52 weeks ended
January 28, 2012.

Ed Anderson, Chairman and Chief Executive Officer, commented, “While the sales
results for the fourth quarter are disappointing, we continue to make very
good progress in our turnaround efforts. There are several reasons for the
disappointing sales in the fourth quarter and following is a fairly detailed
explanation.”

Impact from Delayed Tax Refunds

Fourth quarter comparable store sales decreased 11.8%, comparing the 14 weeks
ended February 2, 2013 to the 14 weeks ended February 4, 2012. The largest
impact on the Company’s comparable store sales for the fourth quarter was the
delay by the Internal Revenue Service of 2012 tax refunds. The IRS moved back
the date it would accept tax returns from January 13 a year ago to January 30
this year. As a result, all tax refund driven sales this year were pushed into
fiscal 2013. In the last two weeks of fiscal January, sales dropped by over
$16 million, most of which, we believe, was due to the delay in tax refunds.
This alone impacted the fourth quarter comparable store sales by 7.5%. Sales
for the first 12 weeks of the 14-week fourth quarter (November, December and
the first three weeks of the five-week January) decreased 4.3%.

Although the year-end closing process is not complete, we expect to report a
net loss of approximately $0.07 per diluted share for the fourth quarter, with
the aforementioned $16 million decrease in sales during the last two weeks of
January adversely impacting net loss per diluted share by approximately $0.35.

Mr. Anderson added, “Last week, we finally saw the beginnings of tax refund
driven sales activity. Although we can’t quantify the impact, we are hopeful
that this activity will help produce a successful first quarter of fiscal
2013.”

Fourth Quarter Comparable Sales by Month

Comparable store sales in November increased 1%, continuing the slight
positive trend that we began in the third quarter.

Comparable store sales in December decreased 10%. We mentioned on the third
quarter earnings call that we expected a drag on fourth quarter sales from
lower layaways. The drag impacted the December month by more than 3% and the
quarter by about 2%. Additionally, we cautioned about the potential difficulty
of comparing to last year’s promotional environment. Last year’s promotional
environment was felt most in the ladies’ business in December. Sales in
December were also impacted at the end of the month by a shift in sales around
the first of January into the January fiscal month.

Comparable store sales in January dropped 28%. January comparable sales were
actually up 10% for the first three weeks of the five-week month, benefiting
from the calendar change mentioned above regarding December. But as mentioned,
sales the last two weeks dropped over $16 million due primarily to the timing
of tax refund driven sales.

Outlook Commentary

“While there were several positives in merchandising in the quarter, improving
sales remains our number one objective,” noted Mr. Anderson. “In particular,
we are laser-focused on our ladies’ business. Urban brands continue to
diminish in importance and non-branded business has not yet improved enough to
offset the branded decreases. We have further intensified our focus on the
fashion element of our ladies’ business and expect improved results in 2013.

“We believe that we are in a fashion cycle where price is still very
important. At the beginning of 2012, we had two merchandising issues - we were
not as competitively priced nor as fashion right as we needed to be. We solved
the pricing issue and now compete with anyone on price. We have made progress
on the fashion issue and believe we can solve it in 2013.

“We ended the year with inventories in a very healthy position. Our balance
sheet is strong and we ended the year with approximately $55 million of cash
and investments, and no debt.

“Note that fiscal 2013 will be a 52-week year, following the 53 weeks of
fiscal 2012. The week that will be lost is week one of fiscal 2012 which was a
$21 million week. We expect this impact, together with the related shift in
the fiscal calendar, to be felt primarily in quarters one and four of 2013.

“Looking forward to the first quarter of 2013, we expect sales to be
negatively impacted by the calendar change mentioned above. We do expect some
benefit from the tax refunds moving from late 2012 into 2013. But, we also
know that our ladies’ apparel business is still significantly challenged by
the diminished brand sales. So, our outlook for the first quarter of 2013
remains cautious.

“We continue to be optimistic about our future and believe we are taking the
actions we need to take to complete the turnaround of Citi Trends.”

Investor Conference Call and Webcast

The Company will report complete financial results for its fourth quarter and
fiscal 2012 before the market opens on March 15, 2013. Citi Trends will host a
conference call on the same day at 9:00 a.m. ET. The number to call for the
live interactive teleconference is (212) 231-2921. A replay of the conference
call will be available until March 22, 2013, by dialing (402) 977-9140 and
entering the passcode, 21645977.

The live broadcast of Citi Trends' quarterly conference call will be available
online at the Company's website, www.cititrends.com, on March 15, 2013,
beginning at 9:00 a.m. ET. The online replay will follow shortly after the
call and continue until March 22, 2013.

During the conference call, the Company may discuss and answer questions
concerning business and financial developments and trends after quarter-end.
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. The Company operates 513 stores located in
29 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 year-end 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.

Contact:

Citi Trends, Inc.
Bruce Smith, 912-443-2075
Chief Financial Officer
or
Ed Anderson, 912-443-3705
Chairman & Chief Executive Officer
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