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From Home Furnishing Business

Kirkland’s, Inc. Reports Financial Results for 4th Quarter and Year End

March 22, 2024  by HFBusiness Staff in Business Strategy, Industry   

Fourth Quarter 2023 Summary

Net sales were $165.9 million, with comparable sales on a 13-week comparison increasing 1.7%.
Gross profit margin of 32.0%.
Operating income of $10.7 million, a $13.9 million improvement quarter-over-quarter.
Operating cash flow of $28.2 million.
Adjusted EBITDA of $14.2 million.
Closed 9 stores during the period.
Ended the year with a cash balance of $3.8 million and $34.0 million in outstanding debt.

Fiscal Year 2023 Summary

Net sales were $468.7 million, with comparable sales on a 52-week comparison decreasing 4.8%.
Gross profit margin of 27.1%.
Operating loss of $24.4 million, an $18.3 million improvement year-over-year.
Adjusted EBITDA of $(8.4) million.
Closed 16 stores and relocated one store to end the year with 330 stores.

Management Commentary

"Fiscal 2023 was a year of significant change across our entire organization that culminated in a positive holiday sales season and healthy momentum to build off of going into 2024," said Amy Sullivan, CEO of Kirkland's Home.

"The fourth quarter marked our first full quarter of capitalizing on the strategic repositioning initiatives we've implemented, which generated positive comparable sales results, strong gross margins, and healthy operating cash flow. Although we remain in the early stages of our strategic repositioning, we are pleased with the results we were able to generate to close out the year.” 

"As we move into fiscal 2024, we will continue prioritizing targeted engagement with our customer base and have been pleased with the in-store traffic levels we've sustained to start the year. Consumers remain highly price sensitive, and while we continue to see dampened demand for larger ticket items, the demand for seasonally relevant décor and accessories remains high, which is more than offsetting the lower average ticket trends we're experiencing thus far.”

“E-commerce traffic has been challenging in comparison to stores to start the year, and we are adjusting our promotional and marketing plans as well as making technical enhancements to support profitable sales growth online. We remain vigilant in managing our expenses, both operating and capital, as top line and margin improvements continue to take hold.

"Overall, we are pleased with the direction Kirkland's Home is headed, and we believe there are opportunities for us to capitalize on and return to profitable growth. With additional capital to improve our liquidity position, a strategy that is generating positive momentum, and a nimble team in place focused on operational excellence, we believe we are well positioned heading into fiscal 2024 and beyond. We remain committed to achieving our long-term strategic goals and unlocking the true potential of Kirkland's Home."

Investor Conference Call and Web Simulcast
A conference call of the report was broadcast and available for replay here and via the investor relations section of the Company's website at www.kirklands.com. The online replay will follow shortly after the call and continue for one year.