With store traffic said to remain challenging, Kirkland’s reported a net loss for the third quarter and declining comps. The company also strengthened its executive team by appointing its first chief operating officer.
For the third quarter ended October 29, Kirkland’s posted a net loss of $800,000, or five cents per diluted share, versus a net loss of $300,000, or two cents per diluted share, in the period a year previous. However, the loss came in lower than a MarketBeat-published analyst average estimate, which anticipated a 10 cent per diluted share loss.
Comparable sales, including e-commerce sales, decreased 2.3% versus the prior-year quarter. Net sales in the quarter increased 7%, to $138.2 million Operating income loss was $1.6 million versus $932,000 in the 2015 period.
Kirkland’s noted that it has appointed Mike Cairnes evp/chief operating officer, a new position at the company. Prior to joining Kirkland’s, he served as president of the Michaels Stores-operated Aaron’s Brothers. Kirkland’s also named Sarah Hussey vp/planning and allocation. Prior to taking up her new position, she had a similar role at Sports Authority.
Mike Madden, Kirkland’s president and CEO, said, “We were pleased with the modest improvement in merchandise margin for the quarter despite a decline in traffic in a highly promotional environment. Our inventory levels are much improved and in good shape as we approach the holiday. Conversion was positive in both the store and e-commerce channels, and our seasonal assortment is performing well. While traffic headwinds persist, we are making solid progress on our key initiatives. We completed a strong class of new store openings, and our recent supply chain investments are supporting stronger efficiency. The new brand campaign, which rolled out on schedule in the third quarter, has a better mix of value and inspirational content, and we’ll build on that as we progress through the holiday season.”
In the third quarter, Kirkland’s opened 11 stores and closed one, bringing the total to 401.
