Q1 2024 Tillys Inc Earnings Call Transcript
Key Points
- Product margins improved by 130 basis points compared to last year due to lower markdown rates and improved initial markups.
- New marketing efforts are being tested to create greater connectivity with existing customers and attract new ones.
- Implementation of new merchandise planning and allocation tools, as well as warehouse management software, is expected to improve operational efficiencies.
- Despite challenges, the company continues to invest in long-term improvements, including new markdown optimization software and enhanced search engine optimization capabilities.
- Total inventories were down 3% compared to the same week last year, indicating better inventory management.
- Total net sales decreased by 6.3% compared to last year's first quarter.
- Comparable net sales, including e-commerce, decreased by 9.4%, with physical stores down 8.6% and e-commerce down 10.8%.
- Total SG&A expenses increased by $1.9 million, primarily due to higher non-cash store asset impairment charges and increased store payroll costs.
- Pretax loss was $19.6 million, or 16.9% of net sales, compared to $16.2 million, or 13.1% of net sales, last year.
- The company experienced complications with new system implementations, which slowed product replenishment to stores during May.
Good day and welcome to the Tilly's Inc. first-quarter 2024 earnings call. (Operator Instructions)
Please note this event is being recorded. I would now like to turn the conference over to Mr. Gar Jackson, IR Please go ahead.
Good afternoon, and welcome to the Tilly's fiscal 2024 first quarter earnings call. Michael Henry, Executive Vice President and Chief Financial Officer, will discuss the company's business and operating results. Then he and Hezy Shaked, Executive Chairman, and Interim President, and Chief Executive Officer, will host a Q&A session.
For a copy of Tilly's earnings press release, please visit the Investor Relations section of the company's website at tillys.com. From the same section, shortly after the conclusion of the call, you will also be able to find a recorded replay of this call for the next 30 days.
Certain forward looking statements will be made during this call that reflect Tilly's judgment and analysis only as of today, June 6, 2024, and actual results
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