Tilly's, Inc. (TLYS) has reported an 128.04 percent jump in profit for the quarter ended Oct. 29, 2016. The company has earned $6.42 million, or $0.22 a share in the quarter, compared with $2.81 million, or $0.10 a share for the same period last year.
Revenue during the quarter grew 7.35 percent to $152.11 million from $141.69 million in the previous year period. Gross margin for the quarter expanded 3 basis points over the previous year period to 31.54 percent. Total expenses were 92.99 percent of quarterly revenues, down from 96.20 percent for the same period last year. This has led to an improvement of 321 basis points in operating margin to 7.01 percent.
Operating income for the quarter was $10.67 million, compared with $5.39 million in the previous year period.
“We are encouraged by the 4.4% comp increase we delivered in the third quarter on top of last year's 3.9% increase," stated Ed Thomas, President and Chief Executive Officer. "A promising Black Friday weekend and Cyber Monday have us off to a decent start to the fourth quarter, and we believe our merchandise assortment is well positioned for the holiday season. We remain focused on improving profitability for the long term."
For the fourth-quarter, Tilly's, Inc. projects operating income to be in the range of $7.50 million to $9.50 million. The company forecasts diluted earnings per share to be in the range of $0.15 to $0.20.
Operating cash flow improves significantly
Tilly's, Inc. has generated cash of $19.59 million from operating activities during the nine month period, up 205.93 percent or $13.19 million, when compared with the last year period.
The company has spent $26.51 million cash to meet investing activities during the nine month period as against cash outgo of $12.41 million in the last year period. It has incurred net capital expenditure of $14.75 million on net basis during the nine month period, down 15.63 percent or $2.73 million from year ago period.
The company has spent $0.71 million cash to carry out financing activities during the nine month period as against cash inflow of $2.55 million in the last year period.
Cash and cash equivalents stood at $43.38 million as on Oct. 29, 2016, down 6.37 percent or $2.95 million from $46.34 million on Oct. 31, 2015.
Working capital increases
Tilly's, Inc. has recorded an increase in the working capital over the last year. It stood at $118.75 million as at Oct. 29, 2016, up 11.35 percent or $12.11 million from $106.64 million on Oct. 31, 2015. Current ratio was at 2.76 as on Oct. 29, 2016, down from 2.79 on Oct. 31, 2015.
Cash conversion cycle (CCC) has decreased to 5 days for the quarter from 46 days for the last year period. Days sales outstanding were almost stable at 5 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 28 days for the quarter compared with 70 days for the previous year period. At the same time, days payable outstanding went down to 29 days for the quarter from 30 for the same period last year.
Debt comes down significantly
Tilly's, Inc. has recorded a decline in total debt over the last one year. It stood at $1.05 million as on Oct. 29, 2016, down 44.53 percent or $0.85 million from $1.90 million on Oct. 31, 2015. Total debt was 0.37 percent of total assets as on Oct. 29, 2016, compared with 0.70 percent on Oct. 31, 2015. Debt to equity ratio was almost stable at 0.01 as on Oct. 29, 2016, when compared with the last year.
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