Kirkland’s Inc. (NASDAQ: KIRK) reported its second quarter results for the fiscal year and beats estimates; boosting shares over 20 percent on Tuesday, hitting a three month high.
The home decor retailer posted revenue of $131.7 million, 7 percent increase from $123 million year over year, and also beating estimates by $6.24 million. Kirkland reported a net loss of $3.8 million or $0.24 a share, beating estimates by $0.05.
Comparable store sales, along with eCommerce sales, increased 1.2 percent compared to a decrease of 4.3 percent year over year. Kirkland opened 16 stores and closed 14 during the first half of the fiscal year.
"The balance sheet is in great shape, with a strong cash position and no debt outstanding on our revolving credit facility," said CEO Mike Madden, "The board has authorized a new share repurchase program, which reflects our long-held policy to use excess cash to enhance shareholder returns. We'll also continue to invest in the business to further strengthen our execution, expand the omni-channel platform, and escalate our brand awareness."
The stock repurchase plan is allowing up $10 million of the company’s outstanding common shares to be bought back. The stock repurchase program does not require the company to repurchase a set number of shares and may terminate the repurchase program at any time.
"Second quarter results were in line with our expectations and we continue to make demonstrable progress on our strategic initiatives to improve our merchandise assortment, optimize our promotional and marketing activity, and advance our overall operational execution," said Madden, "Sales were driven by better trends in existing stores, new store productivity, and continued momentum at kirklands.com. The merchandise margin was under pressure from our planned assortment adjustments and a promotional retail environment. We maintained disciplined expense control and ended the quarter in a better inventory position."
Kirkland maintained its fiscal 2017 outlook given in the first quarter. The company expects diluted earnings per share in the range of $0.50 to $0.65 for the full year. Analysts’ consensus calls for $0.53.