After emerging from Chapter 11 bankruptcy protection early this year, Tuesday Morning began a new fiscal year with a smaller first-quarter loss year over year and a comparable store sales gain on a two-year basis.
However, the earnings per share loss was higher than an analyst estimate for an eight-cent deficit published by MarketWatch.
The company asserted that sales comparability to prior periods is difficult due to the company’s reorganization under Chapter 11, the Covid-19 pandemic, and the elimination of promotional activity, so it is reporting first-quarter fiscal 2022 versus first-quarter fiscal 2020. As such, comparable store sales increased 3.2% for the 489 stores that were open in the first quarter of fiscal 2022 and the first quarter of fiscal 2020, despite store inventory ending down 42% versus the period two years ago.
Net sales were $176.9 million in the quarter versus $161.5 million in the year-earlier quarter. Operating loss was $11.7 million versus $16.5 million in the year-before period.
In a conference call, Tuesday Morning CEO Fred Hand pointed out that the company had completed filling out its executive leadership with Paul Metcalf, a former Burlington Stores exec, appointed principal and permanent chief merchant, and that it had begun refining its supply chain and improving the in-store experience including by, among other initiatives, resigning sales floors.
In announcing the financial results, Fred Hand, CEO, stated, “I am pleased with our first-quarter performance as we exceeded both our sales and financial plan and successfully completed the bankruptcy process in line with our expectations. Despite the ongoing global supply chain dislocation, we believe the quality and level of our inventories has us properly positioned as we enter the holiday season. We are in the very early stages of our transformation, and we are focused on improving our execution of the off-price model across all areas of the organization. While this work will take time, we believe we are making the right steps forward, and we continue to appreciate the great opportunity ahead for Tuesday Morning.”
At the end of the fiscal 2022 first quarter, the company operated 489 stores compared to 490 stores at the 2021 period’s end, and 707 stores at the 2020 period’s end.
Inventories at the end of the fiscal 2022 first quarter were $174.1 million compared to $108.1 million in the fiscal 2021 period.
