NEWS - Retail & Shopping Centers

The economy appears to have finally caught up with Citi Trends, the Savannah-based retail clothing company, that is publicly traded at (NASDAQ: CTRN).
The company reported a second quarter net loss of $69,000 compared with net income of $2,846,000 last year.  Second quarter sales decreased 3.5 percent, and comparable store sales decreased 12.4 percent.
Total sales in the second quarter ended August 1, 2009 decreased 3.5 percent to $111.6 million compared with $115.7 million in the second quarter ended August 2, 2008.
The company believes that last year’s stimulus checks had a direct impact. “Sales and earnings in this year’s second quarter were adversely affected by a difficult comparison to the second quarter of 2008 when our customers’ spending increased due to the government stimulus checks.  As is typical when comparable store sales are negative, gross margin was lower in this year’s second quarter due to higher merchandise markdowns; however, the overall decline in gross margin was limited to 60 basis points due to continued improvement in inventory shrinkage results,” according to the company’s SEC filings.
“Selling, general and administrative expenses were managed tightly, increasing only 5.7 percent, even with a 13 percent increase in store selling square footage since last year’s second quarter,” the company stated. .
Citi Trends continues to open new stores, including eight new openings and one expansion in the second quarter, but also closed three under performing stores, resulting in a total store count of 370 at the end of the quarter.
For the first first half of fiscal 2009, sales increased 7.6 percent to $254.7 million compared with $236.7 million in the first half of fiscal 2008. 
The company estimates that 2009 earnings will be in a range of $1.28 to $1.33 per diluted share which includes an anticipated 2009 comparable store sales increase of approximately 1 percent, and expects to increase selling square footage by at least 15 percent in 2009.

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