Analyst Summary:
Tilly's Inc. reported their Q4 FY2022 financial results, which exceeded their revised outlook ranges mentioned in early January. Despite facing the impacts of the current inflationary environment and potential recession concerns, the company remains cautiously optimistic for FY2023 to improve their operating results compared to FY2022. In Q4 FY2022, total net sales decreased by 11.1%, with net sales from physical stores representing 74% of total net sales, and e-commerce representing 25%. Additionally, the company recorded a decline of 270 basis points in product margins. For FY2022, total comparable net sales decreased by 12.3%, with net sales from stores representing 79% of total net sales, and e-commerce representing 21%. The company also reported a decrease of 300 basis points in product margins for the fiscal year. In Q1 FY2023, the company recorded a total comparable net sales decrease of 19% and expects it to improve over the remainder of the quarter despite the tough prior year comparisons.
Quotes:
"Despite a disappointing year overall, the ongoing impacts of the current inflationary environment, and potential recession concerns ahead, we remain cautiously optimistic that we will be well positioned to improve our operating results in fiscal 2023 compared to fiscal 2022," said Ed Thomas, President and CEO.
Forward-looking statements:
The company has mentioned the overall effect of the COVID-19 pandemic, including its impacts on the company's operations, future financial condition or operating results, and customer traffic, and has expressed caution in managing inventory given the inflationary environment.