Kirkland’s stock slides 10% premarket as profit and guidance fall short
Shares of home decor retailer Kirkland’s Inc. KIRK, -0.67% slid 10% in premarket trade Friday after posting weaker-than-expected profit in the latest quarter and offering guidance that was below consensus. Nashville, Tenn.-based Kirkland’s said it had net income of $14.2 million, or 95 cents a share, in its fiscal fourth-quarter to Feb. 2, up from $12.9 million, or 79 cents a share, in the year-earlier period. Sales fell 3.8% to $216.1 million. The FactSet consensus was for EPS of 97 cents and sales of $216 million. Same-store sales fell 3.3%, matching the FactSet consensus. "While we made progress in key operational areas in 2018, we are disappointed with our overall performance and believe we need to accelerate the pace of change within the organization," CEO Woody Woodward said in a statment. "We are taking meaningful steps to further transform the business to address ongoing changes in home décor retailing." The company is planning to advance new product categories, accelerate direct sourcing and cut costs in its supply chain to address freight headwinds. The company is expecting to see the effects of measures to boost profitability in the second half, he said. The company expects sales for fiscal 2019 to be flat to up 2%, with growth expected in the second half. It expects EPS to range from 15 cents to 30 cents, compared with a FactSet consensus of 40 cents. Shares have gained 9.9% in the last 12 months, while the S&P 500 SPX, -0.09% has gained 2.2%.
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