In This Article:
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Total Sales: Approximately $211 million for the fourth quarter.
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Comparable Store Sales Growth: 6.4% increase in the fourth quarter.
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Gross Margin: 39.7%, a 60 basis point expansion compared to Q4 2024.
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Inventory: Down 6% compared to the prior year.
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Cash Position: $61 million in cash with no debt.
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Store Count: 591 stores at the end of the quarter.
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Adjusted EBITDA: $7.1 million for the fourth quarter.
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Full-Year Sales: $753.1 million for fiscal 2024.
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Full-Year Comparable Store Sales: 3.4% increase on a 52-week to 52-week basis.
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Full-Year Adjusted EBITDA: Loss of $14.2 million.
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Share Repurchase: $10 million spent on repurchasing 395,793 shares at an average price of $25.23.
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2025 Outlook - Comp Sales Growth: Low to mid-single digits expected.
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2025 Outlook - Gross Margin Expansion: Minimum of 220 basis points expected.
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2025 Outlook - EBITDA: Expected to be in the range of $5 million to $9 million.
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2025 Outlook - Store Openings/Closures: Plan to open up to five new stores and close up to five stores.
Release Date: March 18, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Citi Trends Inc (NASDAQ:CTRN) reported a 6.4% increase in comparable store sales for the fourth quarter, showing strong customer traffic and transaction growth.
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The company achieved a gross margin rate of 39.7%, a 60 basis point expansion compared to the previous year.
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Citi Trends Inc (NASDAQ:CTRN) ended the period with inventories down 6% compared to the prior year, indicating improved inventory management.
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The company has a strong financial position with $61 million in cash, no debt, and no drawings on its $75 million revolver.
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Citi Trends Inc (NASDAQ:CTRN) is implementing an AI-based product allocation system to enhance inventory efficiency and reduce markdowns.
Negative Points
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The company experienced a significant miss in plus size apparel due to execution issues, although these have been addressed.
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Adjusted EBITDA for the fourth quarter was $7.1 million, down from $10 million in the same quarter of the previous year.
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Citi Trends Inc (NASDAQ:CTRN) recorded a noncash valuation allowance of approximately $15.5 million related to deferred tax assets.
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The company closed two stores during the quarter as part of its fleet optimization efforts.
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Weather disruptions in January had a 250 basis point negative impact on comparable store sales for the month.
Q & A Highlights
Q: What is Citi Trends doing differently from the industry to sustain momentum into 2025 despite other retailers reporting softening results? A: Kenneth Seipel, CEO, highlighted that Citi Trends has sharpened its price value equation and added an off-price model, which has resonated well with customers. The strategic positioning of their 591 stores in neighborhoods has also made them a first alternative for customers, contributing to market share gains.