Kirkland's currently operates 328 stores in 35 states.
Kirkland's brick-and-mortar store sales picked up steam in the first quarter, but its online business continued to decline.
“We continue to make progress on our strategic initiatives, as evidenced by our brick-and-mortar same-store sales growth of 2.8 percent in the first quarter,” said Amy Sullivan, the company's president. Promoted to CEO “This positive momentum was offset by continued pressure in our e-commerce business, however we are encouraged that our marketing and product repositioning strategies are beginning to show signs of traction,” the company said in a February release.
Kirkland's, the home décor and furniture retailer, is realigning its product assortment to better reflect consumer demand, including carrying fewer high-end furniture pieces. Kirkland's is focusing on flowers, décor and gifts for growth, Sullivan said on the earnings conference call.
On May 14, Kirkland hired Consensus, an investment banking firm specializing in consumer companies, to serve as financial adviser to its board of directors in pursuing and evaluating potential strategic opportunities to support the company and its efforts.
“The Company has not established any deadline or definite timeline for the completion of its strategic alternatives review process, and there can be no assurance that this process will produce any particular outcome,” Kirkland said.
The company reported a net loss of $8.8 million, or a loss of $0.68 per share, for the quarter ended May 4. That was down from a net loss of $12.1 million, or a loss of $0.95 per share, in the same period last year. Net sales fell to $91.8 million from $96.9 million last year.
Comparable store sales decreased 3.5%, including a 19.1% decrease in e-commerce sales and a 2.8% increase in comparable store sales. The decrease was primarily due to lower consolidated average ticket and e-commerce foot traffic, partially offset by higher store foot traffic and conversions.
“Given a slower than expected start to the year and continuing headwinds related to higher-end categories, particularly for price-conscious customers, we are taking steps to improve our e-commerce business, acting quickly to align our cost structure with current demand trends and focusing on driving long-term profitable growth.” Sullivan said in the earnings call.
Inventory at the end of the quarter was $75.8 million, down 9.1% from the year-ago period due to the closure of two e-commerce fulfillment centers in fiscal 2023 and a 4.1% decline in store count.
As of June 6, Kirkland's had $40.9 million in outstanding debt under its revolving credit facility and $10 million in borrowings under its term loans. During February, The company secured Extra credit linea $12 million first-in, last-out delayed draw term loan from Gordon Brothers;
Kirkland's currently operates 328 stores in 35 states.
