US' Citi Trends projects strong Q4 FY24 margins, EBITDA at upper range

In Q4, the company expects comparable store sales to be at the higher end of the low to mid-single-digit growth range, while total sales are expected to decline by a low to mid-single-digit percentage compared to Q4 2023, due to the absence of a 53rd week and store closures, Citi Trends said in a press release.

In the second half (H2) of FY24, the comparable store sales are expected be on the high end of the range of up low to mid-single digits compared to the second half of fiscal 2023 (FY23). Total sales are expected to be flat to down low-single digits due to the 53-week last year and store closures. H2 gross margin is expected to be approximately 39 per cent.

Second half EBITDA is expected to be on the high end of the range of $1.5-$4 million. The company expects to end fiscal 2024 with approximately 590 stores. Year-end cash balance is expected to be in the range of $60 million to $65 million. Capital expenditures (capex) for the full year are expected to be in the range of $14-$18 million.

The total holiday sales for the group were $174.4 million in the quarter-to-date period ending January 4, 2025, compared to $169.0 million in the same period in 2023.

Meanwhile, the comparable store sales, calculated on a shifted 9-week to 9-week basis, increased 7.1 per cent versus the same last year.

“I am pleased to report that our holiday sales were at the high end of our expectations as our revised product assortment, including exciting off-price deals, resonated well with the families we serve. Importantly, our 7.1 per cent comparable store sales growth was driven by improvements in both traffic and basket throughout the period,” said Ken Seipel, chief executive officer (CEO) at Citi Trends. “Consistent with our Q3 fiscal 2024 sales results, our holiday sales results represent good customer acceptance of our efforts to adjust our product value strategy and improved operational processes. As a result of holiday performance, we now expect second half sales and EBITDA results to be at the high end of our previously provided outlook.”

ALCHEMPro News Desk (SG)