Tuesday Morning posted a bigger net loss for its fourth quarter, but the company said it is well positioned to improve sales and earnings performance.
The company reported a net loss of $12 million, or 27 cents per share, for the fourth quarter of fiscal 2019 compared to a net loss of $10.3 million, or 23 cents per share, for the 2018 period.
Comparable store sales advanced 0.7% in the quarter year over year, as transactions increased 3.1% and average ticket decreased 2.3%. Net sales were $230.5 million, essentially flat with the year-prior period. Operating loss was $11.4 million versus an operating loss of $9.4 million in the year-earlier quarter.
For the retailer’s full fiscal year, Tuesday Morning reported a net loss of $12.4 million, or 28 cents per share, versus a net loss of $21.9 million, or 50 cents per share, for the 2018 fiscal year.
Comps gained 0.4% year over year as transactions increased 0.9% and average ticket decreased 0.5%. Net sales were basically flat at $1.01 billion versus the fiscal year prior. Operating loss was $10.5 million versus $21 million in the fiscal year earlier.
Steve Becker, Tuesday Morning CEO, pointed to an improvement in adjusted EBITDA, which was $20 million for fiscal 2019 as compared to $9.6 million for the previous fiscal year, as an indication that the company’s prospects are improving.
“Fiscal 2019 was an important year for Tuesday Morning,” he said. “We delivered significant improvement in our operating performance as evidenced by a doubling of adjusted EBITDA driven by 110 basis points of gross margin expansion. We increased sales slightly despite significantly reducing our traditional ad events and operating 12 fewer stores. We also made solid progress against our key initiatives including driving improvements in our supply chain, increasing marketing efficiencies and renegotiating our leases. On the merchandising front, we have continued to reorganize our buying organization, adding talent and resources focused on executing our off-price model, which resulted in fourth quarter comparable store sales performance that was slightly better than expected and driven by strong transaction growth of 3.1%.”
Becker added that Tuesday Morning is entering a new phase of supply chain enhancements, retrofitting and consolidating its Dallas distribution operations into one existing building with the goal of monetizing remaining Dallas distribution-related assets.
“As we look ahead, the headwinds that we faced this past year from the planned reduction in our traditional ad events will abate, and the improvements we have made across the merchandising organization position us to replicate the success we have seen in key merchandise categories,” he said. “With all of the work we have done, and continue to do, we are well positioned to deliver improved sales and profitability into the next fiscal year and beyond.”