Kirkland's Inc. (NASDAQ:KIRK) Q3 2020 Earnings Conference Call - Final Transcript
Dec 03, 2020 • 09:00 am ET
Good morning, and welcome to Kirkland's Third Quarter 2020 Earnings Conference Call. [Operator Instructions] I would now like to turn the conference over to Tripp Sullivan of SCR Partners. Please go ahead.
Thank you. Good morning and welcome to Kirkland's conference call to review results for the third quarter of fiscal 2020. On the call this morning are Woody Woodward, Chief Executive Officer; and Nicole Strain, Chief Financial Officer. The results, as well as 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's 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 10, 2020, and quarterly report on Form 10-K -- 10-Q filed on June 4, 2020 and September 9, 2020.
I'll now turn it over to Woody.
Steven C. Woodward
Thanks, Tripp, and thank you to all of our Kirkland's team members who take care of our customers and each other in our stores, distribution center and home office. They make this success possible.
This quarter represented a continuation of the momentum we established late last year with steps we took to make the Company nimbler than ever. We now have a better cost structure, a more efficient infrastructure, a merchandise mix that continues to improve, and the overall far cooler brand. Our ultimate goal is to be a specialty retailer where customers can furnish their entire home on a budget. We're at the beginning of the cycle where we are making that goal achievable at Kirkland's and making these improvements sustainable.
These are exceptional results we are reporting for the third quarter, which sets up well for what is typically our strongest quarter of the coming year. Unlike past years where the third quarter was mostly about creating a launching point of maximum velocity in the fourth quarter, we were able to generate a positive store comp and e-commerce comp of nearly 50%, an increase in our cash position to $37 million, GAAP earnings of $0.82 and an adjusted earnings of $0.66.
With significant improvements in our merchandise and gross margin, and the reduction in operating expenses, were evident in the results in addition to big contributions from e-commerce. We generated a 1.2% increase in net sales with 51 less stores from a comparable period a year ago, with an 8.9% comp in total for the quarter. For November, we were able to maintain strong momentum, particularly in e-commerce, and continue to prioritize margin and profitability. While Black Friday has become more spread