Fashion apparel retailer Citi Trends, Inc. (CTRN), Wednesday said its first-quarter profit increased from the same quarter a year ago, helped by improvement in comparable store sales as well as gross margin. The improvement in first quarter margins stemmed from lower freight costs as a percentage of sales, continued efforts to reduce inventory shrinkage, a slightly higher initial merchandise mark-up, and lower markdowns due to tight inventory control. Further, the company raised its outlook for fiscal year 2009.
Savannah, Georgia-based Citi Trends' net income attributable to common shareholders for the first quarter increased to $7.780 million or $0.54 per share from $5.168 million or $0.36 per share in the corresponding quarter a year ago, primarily helped by 7% increase in comparable store sales.
On average, four analysts polled by Thomson Reuters expected earnings of $0.45 per share for the first quarter. Analysts estimate typically excludes special items such as one-time charges or gains.
Net income for the first quarter also increased to $7.929 million from $5.168 million in the comparable quarter last year.
Income from operations for the first quarter jumped to $12.682 million from $6.819 million in the same quarter last year.
Net sales for the first quarter increased to $143.097 million from $120.996 million in the comparable quarter a year ago to come in above the analysts' revenue estimate of $141.83 million for the first quarter.
Looking forward to the fiscal year 2009, the company raised its earnings guidance and now expects earnings $1.33 per share. Previously, the company expected earnings of $1.30 per share for the fiscal year 2009.The Street currently estimates earnings of $0.30 per share fro the current fiscal year.
The currently provided guidance included the first quarter impact of an unrealized loss of $728,000, or $0.03 per diluted share, related to the valuation of the Company's investments in auction rate securities and the estimate also reflects a negative impact of $0.03 per diluted share associated with the adoption of FASB Staff Position EITF 03-6-1 as it relates to the allocation of earnings per share to nonvested shares of restricted stock.
CTRN closed Wednesday's trading at $22.6498, down $1.1202 or 4.71% on the Nasdaq.
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