Kirkland's Inc. (NASDAQ:KIRK) Q1 2018 Earnings Conference Call Transcript

May 31, 2018 • 11:00 am ET


Kirkland's Inc. (NASDAQ:KIRK) Q1 2018 Earnings Conference Call Transcript


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Good morning and welcome to Kirkland's First Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode. (Operator Instructions) After today's presentation, there will be an opportunity to ask questions. (Operator Instructions) Please note this event is being recorded.

I would now like to turn the conference over to Mr. Jeff Black with SCR Partners. Please go ahead.

Jeff Black

Thank you. Good morning and welcome to Kirkland's conference call to review results for the first quarter of fiscal 2018. On the call this morning are Mike Cairnes, Acting CEO; and Nicole Strain, Interim Chief Financial Officer. The results as well as the notice of the accessibility of this conference call on a listen-only basis over the internet were announced earlier this morning in a press release that has been covered by the financial media. 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 provisions of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements involve known and unknown risks and uncertainties, which may cause Kirkland's actual results in future periods to differ materially from forecasted results. Those risks and uncertainties are more fully described in Kirkland's filings with the Securities and Exchange Commission, including the company's Annual Report on Form 10-K filed on April 3, 2018.

With that, I will turn it over to Mike.

Michael B. Cairnes

Thanks Jeff. It's a pleasure to be here with you this morning. For those I have to yet to meet, let me start with the quick introduction. I was Kirkland's Chief Operating Officer since November 2016, before being named acting CEO this year. I have spent the majority of my career in the home decor sector and a wide variety of merchandising, operations and senior leadership roles most notably at Michael's Stores.

I came to Kirkland's because I saw an incredible opportunity to grow the brand. I believe we are very well-positioned to exploit trend-right style and value as an omni-channel specialty retailer of home decor. I have just as much conviction about our ability to execute on that opportunity, as I did when I joined the company and I look forward to updating you on our progress.

On our fourth quarter call, we outlined a solid plan for 2018 that incorporated a number of initiatives to grow revenue and improve our overall operating efficiency. I'm pleased with our performance to start 2018. I'll spend some time this morning updating you on where we're seeing success and where we still need to make more improvement. In short, we are realizing progress on fundamentals, while setting the stage for the future. We achieved record sales in the quarter with positive comparable store sales, while growing merchandise margin.

Overall, the results demonstrate that we are delivering a better customer experience with new and exciting products supported by improved clarity across our merchandise presentations on the back of improved operational efficiency. At the same time, we are making strides to improve financial