Q2 2024 Kirkland's Inc Earnings Call Transcript
Key Points
- Adjusted EBITDA improved by $3.3 million compared to last year, indicating better profitability management.
- Positive reactivation rates of lapsed customers, with a 39% reactivation over the last 12 months.
- Increased store traffic and positive comparable store sales growth of 1.8% for the quarter.
- Successful reintroduction of seasonally relevant micro trend collections, such as Mother's Day gifting and back-to-campus decor.
- Enhanced K Club loyalty program, resulting in 40,000 redemptions in Q2 and increased customer engagement.
- Total comparable sales declined by 1.7%, with a significant 10.6% decline in e-commerce sales.
- Ongoing challenges in high-ticket categories like furniture, mirrors, and rugs, impacting overall sales.
- Increased promotional activity required to incentivize consumer purchases, particularly in higher ticket categories.
- Higher borrowing levels and interest rates led to increased net interest expense of $1.4 million in the quarter.
- Negative operating performance for the quarter resulted in increased borrowings, reflecting seasonal growth in working capital and capital expenditures.
Good morning, everyone, and thank you for participating in today's conference call to discuss Kirkland's financial results for the second-quarter ended August 3, 2024. Joining us today are Kirkland's Homes, CEO, Amy Sullivan; EVP and CFO, Mike Madden, and the company's external Director of Investor Relations, Caitlin Churchill. Following their remarks, we'll open the call for your questions.
Before we go further, I would like to turn the call over to Mr. Churchill, as she reads the company's safe harbor statements within the meaning of the Private Securities Litigation Reform Act of 1995. That provides important cautions regarding forward-looking statements. Caitlin, please go ahead.
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Thank you. Except for historical information discussed during this conference call, the statements made by company management are forward-looking and made pursuant to the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve
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