Kirkland’s misses with growing Q2 loss, plans 40 new stores

Nashville, Tenn. — Even as net sales climbed, Kirlkland’s Inc. missed Wall Street expectations with growing net loss in the second quarter of fiscal 2015. Increases in operating expenses and depreciation helped more than double net loss to $2.3 million from $1.1 million the same quarter a year earlier.

Net sales rose 10% to $233.6 million from $211.7 million. Same-store sales, including e-commerce, rose 4.8%.

Kirkland’s plans approximately 40 new store openings and 10 to 15 store closings for the fiscal year. The bulk of the remaining new store openings are expected to occur during the third quarter, and most of the remaining store closings are expected to happen at the end of the fiscal year.

"Our sales trend was solid during the quarter, driven primarily by strong in-store conversion rates and a higher average ticket,” said Mike Madden, Kirkland’s president and CEO.“Like the first quarter, traffic remained somewhat uneven, but we were able to repeat a strong merchandise margin performance from last year and ended the quarter with fresh and current inventories.”

Total sales for fiscal 2015 are expected to increase approximately 11% to 12% compared with fiscal 2014, including a same-store sales increase of approximately 3% to 5%.