Kirkland's stock dips premarket as promise of better times in 2023 offsets quarterly loss and sales miss
Kirkland's Inc. stock pared early gains to trade down 1.6% premarket Friday, after the specialty retailer of home decor and furnishings . Nashville, Tenn.-based Kirkland's swung to a loss of $7.3 million, or 58 cents a share, after income of $7.2 million, or 51 cents a share, in the year-earlier period. The company's adjusted per-share loss came to 38 cents, wider than the 32 cent FactSet consensus. Sales fell to $131.0 million from $143.6 million a year ago, below the FactSet consensus of $134.0 million. Same-store sales fell 7%, while FactSet expected a decline of 3%. Chief Executive Steve Woodward said the performance was in line with the company's own expectations. "We experienced an encouraging rebound in sales through August and our Labor Day promotional event, but we believe persistent macro-economic pressures hampered our customers during the Harvest selling season, resulting in softer sales for the back half of the quarter," he said, a trend that has been reported by other retailers, including Target Corp. and Macy's Inc. . However, sales have improved in the fourth quarter as holiday merchandise has filled shelves, said Woodward. "We've made good initial progress reducing inventories, and we have already made a substantial reduction in our borrowings," he said. "Additionally, supply chain disruptions have eased, and inbound freight rates have declined. While we won't see a significant benefit from these factors until we've worked through our current inventory, we expect it to show in our merchandise margin in fiscal 2023 and beyond." The company is expecting 2023 to be a year of stabilization, he said. Shares have fallen 74% in the year to date, while the S&P 500 has fallen 14%.
-Ciara Linnane
(END) Dow Jones Newswires
December 02, 2022 08:45 ET (13:45 GMT)
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