US' Tilly's projects Q1 FY25 sales of $105–111 mn, down 8 to 3%

The company’s selling, general, and administrative expenses (SG&A) expenses are estimated at $42 million to $43 million, excluding potential non-cash store asset impairment charges. The projected pre-tax loss is between $20 million and $17 million, with a near-zero effective income tax rate due to a full, non-cash valuation allowance on deferred tax assets, Tilly’s said in a press release.

Meanwhile, net loss per share is expected to range from $0.68 to $0.58, based on approximately 30 million weighted average shares. The company anticipates having 238 stores open at the end of the quarter, down from 246 in the previous year. Liquidity remains stable, with projected total cash, cash equivalents, and marketable securities between $25 million and $30 million, with no debt outstanding under its asset-backed credit facility. At the current comparable net sales trend, the company expects to operate without accessing its credit facility throughout FY25.

“For fiscal 2025, we aim to stabilise and then grow sales with improved inventory efficiencies and reduced expenses compared to fiscal 2024, and we believe our Spring assortment is on trend,” said Hezy Shaked, president and chief executive officer (CEO) at Tilly’s.

Full-year 2024 (FY24) financial results

For FY24, net sales declined 8.6 per cent year-over-year (YoY) to $569.5 million, with comparable net sales dropping 8.0 per cent. Physical store sales fell 8.4 per cent to $444.7 million, and e-commerce sales decreased 9.3 per cent YoY to $124.7 million.

The gross profit stood at $149.7 million, or 26.3 per cent of net sales in FY24. SG&A expenses increased to $199.5 million, driven by higher software, fulfilment, and store asset impairment costs. The company posted an operating loss of $49.8 million, compared to $31.0 million last fiscal, and a net loss of $46.2 million, compared to $34.5 million in fiscal 2023 (FY23).

Fourth quarter (Q4) FY24 financial

The company’s total net sales fell 14.9 per cent YoY to $147.3 million in Q4 FY24 ended February 1, 2025. The comparable net sales declined 11.2 per cent YoY in Q4 FY24. Physical store net sales dropped 13.7 per cent to $108.3 million. The company ended Q4 with 240 total stores compared to 248 total stores at the end of the Q4 FY23. The net sales from e-commerce were $39.0 million, a decrease of 17.8 per cent YoY.

The gross profit in Q4 stood at $38.3 million, representing 26.0 per cent of net sales, down from 27.0 per cent last year. SG&A expenses declined to $52.4 million, though they rose as a percentage of net sales. The company reported an operating loss of $14.1 million and a net loss of $13.7 million, an improvement from last year’s $20.6 million loss due to the impact of a valuation allowance. Despite the challenging retail environment, the company remains focused on improving product margins and managing costs while navigating softer consumer demand.

“Our fourth quarter results were a disappointment. We made a number of changes in our merchandising organisation during the fourth quarter to attempt to change our sales trajectory going forward,” added Shaked.

Fibre2Fashion News Desk (SG)