• Total Sales Growth: $15.4 million increase, or 8.3% over the prior year.

• Adjusted EBITDA: Increased by $6.2 million, representing a sales to profit flow through of 40%.

• Gross Margin: Expanded by 90 basis points to 39.6%.

• Operating Expense Leverage: Improved by 220 basis points.

• Comparable Store Sales Growth: 9.9% increase over the prior year.

• Q1 Sales: $201.7 million, up 8.3% compared to Q1 2024.

• SG&A Expense: $74.4 million or 36.9% of revenue, a 220 basis point improvement.

• Diluted Earnings Per Share: $0.11 or $0.17 as adjusted, compared to a loss per share of $0.42 or $0.32 as adjusted in Q1 2024.

• Inventory Levels: Total inventory dollars decreased by 7.6% compared to last year.

• Cash Position: $42 million in cash with no debt.

• Store Remodels: 19 stores remodeled in Q1, with 36 completed year-to-date.

• Full Year Comp Store Sales Growth Outlook: Mid-single digits.

• Full Year Gross Margin Expansion Outlook: Approximately 200 basis points.

• Full Year EBITDA Outlook: $6 million to $10 million, a $20 to $24 million improvement versus fiscal 2024.

• Warning! GuruFocus has detected 6 Warning Signs with CTRN.

Release Date: June 03, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Citi Trends Inc (NASDAQ:CTRN) reported a total sales growth of $15.4 million, or 8.3% over the prior year, with a comparable store sales growth of 9.9%.

• The company achieved a gross margin expansion of 90 basis points and operating expense leverage of 220 basis points, demonstrating effective cost structure management.

• Citi Trends Inc (NASDAQ:CTRN) has successfully implemented strategic product initiatives, resulting in strong performance across all apparel and home categories, with many experiencing double-digit growth.

• The company has made significant progress in its strategic transformation phases, focusing on product value, supply chain speed, and operational efficiency.

• Citi Trends Inc (NASDAQ:CTRN) has maintained a healthy financial position with no debt, $42 million in cash, and $117 million in liquidity, enabling it to fund business initiatives effectively.

Negative Points

• The accessory business was slightly below plan for the quarter, indicating a need for refinement in the assortment to better meet customer needs.

• Distribution center performance was below expectations, highlighting a critical area for improvement in the company's operations.

• The company faces uncertainty in the macroeconomic environment, particularly concerning potential changes in tariffs, which could impact future performance.

• Despite strong Q1 results, the company has provided a conservative full-year outlook, suggesting potential challenges in maintaining growth momentum.

• The remodel program, while showing solid returns, is still in early stages, with only 25% of the fleet in an updated format, indicating a need for further investment and execution.