KIRK - Kirkland's falls after posting larger-than-expected Q4 loss

2023-04-04 07:28:22 ET

Kirkland's ( NASDAQ: KIRK ) reported revenue fell 7.8% in Q4 Comparable same-store sales decreased 6.1%, including a 5.5% decline in e-commerce sales. The decrease was primarily driven by a decline in traffic, partially offset by an increase in average ticket.

The retailer noted that it started the Q4 with promising sales trends during its Black Friday event before declining traffic and the effect of significant inventory reductions in the merchandise mix drove sales lower for the balance of the quarter.

Kirkland's ( KIRK ) operating loss for the quarter was $3.2M vs. $14.0M. A drop in gross profit and the deleverage of fixed operating costs contributed to the loss. Adjusted EBITDA for the quarter was $2.6M vs. $20.3M a year ago.

On the balance sheet, the company ended the quarter with a cash balance of $5.2M and total liquidity of $46.2M, with $15.0M of outstanding debt under its $75M senior secured revolving credit facility.

"With better liquidity and a rebalanced merchandise strategy in place, we believe fiscal 2023 will be a year of stabilization," noted CEO Steve Woodward.

Shares of Kirkland's ( KIRK ) fell 3.50% in premarket trading to $2.75.

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