Tilly’s Q4 comparable sales drop 2 percent against 6.4 percent rise in 2018

Tilly’s, Inc. said fourth quarter net sales were 172.5 million dollars, an increase of 1.9 million dollars or 1.1 percent, while comparable store net sales, which includes e-commerce net sales, decreased 2 percent compared to last year’s increase of 6.4 percent. Total net sales for the full year were 619.3 million dollars, an increase of 20.8 million dollars or 3.5 percent, while comparable store net sales, which includes e-commerce net sales, increased 0.8 percent compared to last year’s increase of 4 percent.

“A deeper than expected drop in store traffic and comparable store net sales during the second and third weeks of December resulted in a disappointing fourth quarter overall, which was our first negative comp quarter in over three and a half years,” commented Ed Thomas, President and Chief Executive Officer of Tilly’s, adding, “Comparable store net sales are off to a positive start thus far in the first quarter of fiscal 2020. However, due to the uncertainty of the potential near-term impacts of the coronavirus situation, we are unable to provide specific earnings guidance at this time.”

Review of Tilly’s Q4 trading performance

The Company ended the quarter with 240 total stores, including one RSQ-branded pop-up store, compared to 229 total stores, including four RSQ-branded pop-up stores, last year. The company added that comparable store net sales in physical stores decreased 2.2 percent and represented approximately 80.7 percent of total net sales, compared to a decrease of 0.9 percent and an 80.3 percent share of total net sales last year. E-commerce net sales decreased 1.2 percent and represented approximately 19.3 percent of total net sales, compared to an increase of 49.6 percent and a 19.7 percent share of total net sales last year.

Gross profit for the quarter was 52.1 million dollars, or 30.2 percent of net sales, compared to 52.2 million dollars or 30.6 percent of net sales last year. Operating income was 8.5 million dollars or 4.9 percent of net sales, compared to 10.9 million dollars or 6.4 percent of net sales, last year. Net income was 6.3 million dollars or 21 cents per diluted share, compared to 8.7 million dollars or 29 cents per diluted share, last year.

Tilly’s full year ecommerce sales improve 9.7 percent against 21.7 percent in 2018

Full year ecommerce net sales increased 9.7 percent and represented approximately 15.9 percent of total net sales compared to an increase of 21.7 percent and a 15 percent share of total net sales last year. Comparable store net sales in physical stores decreased 0.7 percent and represented approximately 84.1 percent of total net sales compared to an increase of 1.4 percent and 85 percent share of last year’s total net sales.

Gross profit for the year was 186.7 million dollars, an increase of 5.8 million dollars or 3.2 percent, compared to 180.9 million dollars last year, while gross margin, or gross profit as a percentage of net sales, slightly decreased to 30.1 percent from 30.2 percent last year. Operating income was 28.5 million dollars or 4.6 percent of net sales, compared to 31.5 million dollars or 5.3 percent of net sales, last year. Net income was 22.6 million dollars or 76 cents per diluted share compared to 24.9 million dollars or 84 cents per diluted share, last year.

The company further said that through March 10, 2020, total comparable store net sales, including e-commerce, have increased by a low single-digit percentage with comparable store net sales in stores slightly negative and e-commerce net sales up high single-digits on a percentage basis. However Tilly’s said that given the unpredictability of the effects of the coronavirus on consumer behavior, store traffic, production capabilities, timing of deliveries, its employees, economic activity and the market generally in the coming weeks and months, the company is unable to provide specific earnings guidance at this time.

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