LONDON, UK / ACCESSWIRE / May 01, 2018 / Active-Investors.com has just released a free earnings report on Tile Shop Holdings, Inc. (NASDAQ: TTS) ("Tile Shop"). If you want access to this report all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=TTS. The Company reported its first quarter fiscal 2018 operating and financial results on April 19, 2018. The specialty retailer of natural stone and man-made tiles provided guidance for FY18. Register today and get access to over 1000 Free Research Reports by joining our site below:
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Earnings Highlights and Summary
For the first quarter ended March 31, 2018, Tile Shop's net sales decreased 1.1% to $91.1 million from $92.1 million in Q1 2017. The drop in the Company's net sales was attributed to a comparable store sales decrease of 6.8%, offset by net sales of $5.3 million from stores not included in the comparable store base. The decrease in comparable store sales for the reported quarter was traffic-related, due in part to Tile Shop's elimination of advertised price promotions. Tile Shop's revenue numbers lagged analysts' estimates of $92.8 million.
Tile Shop's gross profit fell 1.1% to $64.0 million in Q1 2018 from $64.7 million in Q1 2017. The Company's gross margin rate was 70.3% for both the reported quarter and the prior year's same quarter. Tile Shop's gross margin rate improved sequentially from the 66.8% reported in Q4 2017, primarily due to decreased promotional activities.
During Q1 2018, Tile Shop's selling, general, and administrative expenses (SG&A) increased 13.1% to $57.9 million compared to $51.2 million in Q1 2017, driven primarily by costs associated with the opening and operating of 14 new stores over the past twelve months.
For Q1 2018, Tile Shop reported a net income of $4.01 million, or $0.08 per diluted share, compared to $8.01 million, or $0.15 per diluted share, in Q1 2017. The Company's earnings surpassed Wall Street's estimates of $0.07 per share.
Tile Shop's adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) were $13.8 million in Q1 2018 compared to $20.7 million in Q1 2017.
Tile Shop's inventory increased 27.5% to $88.3 million at March 31, 2018, from $69.3 million at March 31, 2017. The increase was the result of the Company's strategy to expand its product assortment and improve its product presentation.
During Q1 2018, Tile Shop reduced its long-term debt by approximately $1.9 million. The Company amended its credit agreement to reduce the minimum fixed charge ratio to 1.35, and to increase the maximum rent adjusted leverage ratio to 4.0.
Store Expansion and Investment
For Q1 2018, Tile Shop opened 2 new retail stores, consisting of its second Connecticut location in Hartford, Connecticut, and its third location in the Austin, Texas area in Round Rock, Texas. As of March 31, 2018, the Company operated 140 stores in 31 states and the District of Columbia. Tile Shop also remodeled 4 stores during Q1 2018.
For the full fiscal year 2018, Tile Shop is forecasting capital investment of approximately $27 million to $32 million, including the remodeling of approximately 30 stores, to support its product presentation strategy. The Company is estimating inventory investment of approximately 25% to 35% on a y-o-y basis, over the next several quarters, to support its product assortment strategy. Tile Shop also plans an increase in SG&A of approximately $5 million to $7 million to support its service strategy.
Over a longer-term period, Tile Shop announced that it remains committed to achieving both adjusted EBITDA margin and pre-tax return on capital employed of greater than 20%.
Stock Performance Snapshot
April 30, 2018 - At Monday's closing bell, Tile Shop's stock dropped 2.14%, ending the trading session at $6.85.
Volume traded for the day: 808.59 thousand shares.
Stock performance in the last month – up 14.17%
After yesterday's close, Tile Shop's market cap was at $352.09 million.
Price to Earnings (P/E) ratio was at 31.42.
The stock has a dividend yield of 2.92%.
The stock is part of the Services sector, categorized under the Home Improvement Stores industry.
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