Comparable store sales, a key metric that measures the performance of stores open for at least one year, experienced a significant drop of 14.1 per cent when compared to Q1 2022.

The gross margin for Q1 FY23 stood at 36.7 per cent (or 37 per cent as adjusted) in comparison to 39 per cent recorded in Q1 FY22, the company said in a press release.

Citi Trends reported an operating loss of $9.5 million for Q1 FY23. However, when adjusted, the operating loss amounted to $7.9 million. This is in stark contrast to the operating income of $39.7 million ($4.7 million as adjusted) achieved in the same period last year.

The net loss per share for Q1 FY23 was reported as $0.81 or adjusted net loss per share of $0.66. This is a significant shift from the diluted earnings per share of $3.59 ($0.42 as adjusted) recorded in Q1 FY22. The increase in net loss per share indicates a challenging financial period for the company.

“Against what remained a challenging macro backdrop for the low-income families that we serve, our first quarter results were in line with our previously stated guidance. During the quarter, we made progress rebuilding inventory in key areas of the business, which we believe will position us to recoup market share. Although we are seeing good response to our spring and early summer merchandise, our customers are being selective about what they put in their basket. That said, we continue to see strong shopper conversion, a clear signal that our assortments are resonating, and the Citi Trends brand position remains healthy,” said David Makuen, chief executive officer.

During Q1 FY23, the company’s quarter-end total dollar inventory decreased by 11.9 per cent compared to Q1 FY22. However, average in-store inventory increased by 8.1 per cent compared to the same period last year.

Fibre2Fashion News Desk (DP)