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SAVANNAH, Ga. - On Tuesday, Citi Trends, Inc. (NASDAQ:CTRN) reported second-quarter earnings that significantly exceeded analyst expectations and raised its full-year guidance.
The off-price retailer’s shares jumped 2.79% in pre-market trading after the release.
The company posted second-quarter earnings per share of $0.46, dramatically outperforming the analyst estimate of -$0.92. Revenue reached $190.8 million, surpassing the consensus estimate of $183.64 million and increasing 8% compared to the same period last year.
Comparable store sales grew 9.2%, marking the fourth consecutive quarter and 12th straight month of comparable sales gains. The company achieved a gross margin of 40.0%, its highest second-quarter rate since fiscal 2021, representing an 890 basis point improvement from the previous year.
"I’m pleased to report another quarter of strong, consistent performance as our strategic transformation continues to build momentum," said Ken Seipel, Chief Executive Officer. "The majority of our sales growth over the past four quarters has been driven by increased customer traffic and transactions. By staying laser-focused on our core African American customer base, improving execution of our three-tiered product assortments, offering more compelling extreme-value deals, and introducing more trend-leading merchandise, we have encouraged our customers to shop more often and purchase more items."
Following these strong results, Citi Trends raised its full-year outlook, now expecting comparable store sales growth in the mid to high-single digits, up from its previous forecast of mid-single digit growth. The company also projects full-year EBITDA to range between $7 million and $11 million, representing a $21 million to $25 million improvement compared to 2024.
The retailer ended the quarter with $50.4 million in cash, no debt, and no borrowings under its $75 million credit facility. Merchandise inventory decreased 12.9% compared to the second quarter of 2024, reflecting better buying discipline and a faster supply chain.
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