Citi Trends expects to increase selling square footage by 15%
26 May '09
2 min read
Citi Trends Inc reported record first quarter sales and earnings.
Financial Highlights – First quarter ended May 2, 2009 Total sales in the first quarter ended May 2, 2009 increased 18.3% to $143.1 million compared with $121.0 million in the first quarter ended May 3, 2008. Comparable store sales increased 7.4% in the first quarter. Net income was $7.9 million compared with $5.2 million in last year's first quarter. Earnings per diluted share increased to $0.54 in the first quarter of 2009 compared with $0.36 in the first quarter of 2008.
Earnings in the first quarter of 2009 benefited from the 7.4% increase in comparable store sales, together with a higher gross margin that was a result of lower freight costs as a percentage of sales, continued efforts to reduce inventory shrinkage, a slightly higher initial merchandise mark-up, and lower markdowns due to tight inventory control.
The Company opened 8 stores and relocated or expanded 4 others in the first quarter of 2009, reaching a total store count of 365 at the end of the quarter.
Fiscal 2009 Outlook The Company is raising its 2009 earnings estimate to approximately $1.33 per diluted share which includes an anticipated 2009 comparable store sales increase of approximately 3%. For the year, the Company expects to increase selling square footage by at least 15%. The effective tax rate for 2009 is estimated to be in a range of 34% to 35%.
The earnings estimate includes the first quarter impact of an unrealized loss of $728,000, or $0.03 per diluted share, related to the valuation of the Company's investments in auction rate securities. In addition, the estimate reflects a negative impact of $0.03 per diluted share associated with the adoption of FASB Staff Position EITF 03-6-1 as it relates to the allocation of earnings per share to nonvested shares of restricted stock.
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