Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (See General Instruction A.2 below):
Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2
of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
If an emerging growth company, indicate
by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
On March 17, 2026, the
Company issued a press release reporting its financial results for the fourth quarter and full year ended January 31, 2026 (the
“Press Release”). A copy of the Press Release is attached to this Current Report on Form 8-K (the “Current
Report”) as Exhibit 99.1, the contents of which are incorporated herein solely for purposes of this Item 2.02 disclosure by
this reference.
The information contained in this Item 2.02, including
the Press Release attached to this Current Report, is being furnished and shall not be deemed “filed” for purposes of Section
18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of such
section. The information in this Item 2.02, including the Press Release, shall not be incorporated by reference into any filings under
the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in any such
filing.
(d) Exhibits.
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Exhibit 99.1
CITITRENDS ANNOUNCES FOURTH QUARTER
AND FISCAL 2025 RESULTS
Q4 2025 total sales of $230.4 million
with comparable store sales growth of 8.9%; Two-year stack of 15.3%
Fiscal 2025 total sales of $820.0 million with comparable store sales growth of 9.7%; Two-year stack of 13.1%
Strong start to Q1 2026 with high-single
digit comparable store sales increase
Fiscal 2026 Outlook doubles prior
year adjusted EBITDA
SAVANNAH, GA (March 17, 2026) — Citi Trends, Inc. (NASDAQ: CTRN),
a leading off-price value retailer of apparel, accessories and home trends primarily for Black families in the United States, today reported
results for the fourth quarter and full year ended January 31, 2026. For purposes of comparison, unless otherwise stated, metrics in this
release are compared to the 13-week quarter and 52-week full year ended February 1, 2025.
Chief Executive Officer Comments
Ken Seipel, Chief Executive Officer, said: “Our fourth quarter
results cap a transformational year for CITITRENDS. We delivered 8.9% comparable store sales growth in Q4, or 15.3% on a two-year basis,
marking our sixth consecutive quarter of positive comps. For the full year, comparable store sales increased 9.7%, reflecting strong customer
traffic and broad-based growth across our stores, geographies, and merchandise categories. This momentum has continued into 2026, with
Q1 quarter-to-date comparable store sales trending in the high-single digits.
Fiscal 2025 was about strengthening the foundation of the business
and building the operational infrastructure needed for sustained profitable growth. We expanded net income by $48.4 million compared to
fiscal 2025 to $5.2 million, expanded adjusted EBITDA* by $26 million year-over-year to $11.8 million, improved gross margin by more than
200 basis points, and delivered meaningful SG&A leverage. We believe these results validate the strategic actions we have taken to
refocus the business on the Black customer – the center of everything we do, to sharpen our merchandise assortments, and to improve
operational execution across the company.
In fiscal 2026, our priorities are: consistent execution, sales flow
through to profit and accelerated growth. For the year, we are targeting mid to high-single digit growth in total sales and continued
margin expansion, and we expect to position the company to deliver adjusted EBITDA* of $34 million to $38 million this year, which more
than doubles our profit performance from fiscal 2025.
With improving traffic trends, stronger operational discipline, and
a clear path forward, we believe CITITRENDS is well positioned to continue driving profitable growth and shareholder value.”
Financial Highlights – Fourth Quarter 2025
| · | Total sales of $230.4 million increased
$19.2 million, or 9.1% vs. Q4 2024; comparable store sales increased 8.9% compared to Q4 2024
driven by increases in both traffic and basket, as a result of the improved three-tiered merchandise assortment. |
| · | Gross margin of 39.9% increased 20 basis
points compared to Q4 2024 due to lower markdowns, benefiting from our improved merchandise assortment and value proposition, upgraded
allocation processes and inventory efficiency initiatives. |
| · | SG&A expense of $80.0 million compared
to Q4 2024 SG&A expense of $77.5 million, or $76.7 million as adjusted*, which reflected the costs to process higher sales and $1.8
million of incremental incentive compensation from improved financial performance. On a rate basis, adjusted SG&A expenses levered
160 basis points compared to Q4 2024. |
| · | Net income of $7.4 million, $7.2 million
as adjusted*, vs. net loss of $14.2 million, or adjusted net loss* of $12.8 million in Q4 2024. |
| · | Adjusted EBITDA* of $11.9 million compared
to adjusted EBITDA* of $7.1 million in Q4 2024. |
| · | Real Estate: Closed 3 stores in the quarter. |
| · | Cash of $66.1 million at quarter-end, with
no debt and no borrowings under a $75 million credit facility. |
| · | Merchandise inventory was $113.5 million
at the end of the quarter, a decrease of 7.4% vs. Q4 2024, with average store inventory down 2.0% vs. last year, a result of on-going
inventory efficiency initiatives. |
Financial Highlights – Full Year 2025
| · | Total sales of $820.0 million increased
$66.9 million, or 8.9% vs. 2024; comparable store sales increased 9.7% to 2024, 13.1% on a two-year
basis |
| · | Gross margin of 39.6% compared to 37.5%
in 2024; the 210 basis point expansion was driven by lower markdowns and lower shrink from lapping last year’s strategic inventory
reset plus lower freight expense. |
| · | SG&A of $313.2 million, $312.8 million
as adjusted* vs. $300.2 million, or $296.3 million as adjusted* in 2024; on a rate basis, adjusted SG&A* rate leveraged 120 basis
points compared to 2024. |
| · | Net income of $5.2 million, including the
$11.0 million gain on the sale of the Savannah office building in Q2 2025, or adjusted net loss* of $5.3 million, vs. net loss of $43.2
million, or adjusted net loss* of $36.7 million in 2024. |
| · | Adjusted EBITDA* of $11.8 million compared
to adjusted EBITDA* loss of $14.2 million in 2024. The adjusted EBITDA* improvement of $26.0 million to last year was driven by higher
sales, 210 basis point increase in gross margin rate and 120 basis points of adjusted SG&A leverage, including the impact of higher
incentive compensation accruals. |
| · | Real Estate: Opened 3 new stores, remodeled
62 locations and closed 4 stores to end the year with 590 locations |
| · | Capital Expenditures for the year totaled
$22.7 million |
Capital Return Program Update
In the fourth quarter of fiscal 2025, the Company did not repurchase
any shares of its common stock. During fiscal 2025, the Company repurchased 250,555 shares of its common stock at an aggregate cost of
$6.3 million. At the end of fiscal 2025, $40.0 million remained available under the Company’s share repurchase program.
Fiscal 2026 Outlook
Beginning in 2026 the Company will update its definition of adjusted
EBITDA and adjusted SG&A to include an addback of equity-based compensation expense because equity-based compensation is a non-cash
expense that the Company does not use to assess core profitability. The Company believes excluding equity-based compensation will improve
comparability and provide greater transparency of cash generated from operations.
For reference, in fiscal 2025 this expense was $1.0 million in Q1,
$1.5 million in Q2, $1.5 million in Q3 and $1.4 million in Q4, totaling $5.4 million for the year. In fiscal 2026, equity-based compensation
expense is expected to be in the range of $5.5 million to $6.0 million. The adjusted EBITDA and adjusted SG&A information provided
within this “Fiscal 2026 Outlook” section, including prior year results, have been adjusted to reflect this change.
The Company’s outlook for fiscal 2026 compared to fiscal 2025
is as follows:
| · | Expecting total sales growth of 6% to 8% with comparable store sales growth
in the range of 5% to 7% |
| · | Gross margin is expected to expand approximately 100 basis points |
| · | Adjusted SG&A* is expected to leverage 70 to 100 basis points, as adjusted* |
| · | Adjusted EBITDA* is now expected to be in the range of $34 million to $38
million, with approximately 200 basis points of adjusted EBITDA margin* expansion |
| · | For the year, the Company plans to open approximately 25 new stores, remodel
50 stores, and close 4 locations |
| · | Capital expenditures are expected to be in the range of $35 million to $40
million, with the majority of the spend on new stores and remodels |
Investor Conference Call and Webcast
CITITRENDS will host a conference
call today at 9:00 a.m. ET. The live broadcast of CITITRENDS’ conference call will be available online at the Company’s website,
cititrends.com, under the Investor Relations section, beginning today at 9:00 a.m. ET.
The online replay will follow shortly after the call and will be available for replay for one year.
The live conference call can also
be accessed by dialing (877) 407-0779. A replay of the conference call will be available until March 24, 2026, by dialing (844) 512-2921
and entering the passcode,13756478.
During the conference
call, the Company may discuss and answer questions concerning business and financial developments and trends that have occurred after
quarter-end. The Company’s responses to questions, as well as other matters discussed during the call, may contain or constitute
information that has not been disclosed previously.
*Non-GAAP Financial Measures
The historical non-GAAP
financial measures discussed herein are reconciled to their corresponding GAAP measures at the end of this press release. The Company
is unable to provide a full reconciliation of the forward-looking non-GAAP financial measures above without unreasonable effort because
it is not possible to predict certain of the adjustment items with a reasonable degree of certainty. This information is dependent upon
future events and may be outside of the Company’ control and its unavailability could have a significant impact on its financial
results.
About CITITRENDS
Citi Trends, Inc. is
a leading off-price value retailer of apparel, accessories and home trends primarily for Black families in the United States. The Company
operates 592 stores located in 33 states. For more information, visit cititrends.com or your local store.
Forward-Looking Statements
All statements other than
historical facts contained in this news release, including statements regarding the Company’s future financial results and position,
business policy and plans, objectives and expectations of management for future operations and capital allocation expectations, are forward-looking
statements as defined in the Private Securities Litigation Reform Act of 1995 that are subject to material risks and uncertainties. The
words “believe,” “may,” “could,” “plans,” “estimate,” “expects,”
“continue,” “anticipate,” “intend,” “expect,” “upcoming,” “trend,”
“guidance,” “outlook” and similar expressions, as they relate to the Company, are intended to identify forward-looking
statements, although not all forward-looking statements contain such language. Statements with respect to earnings, sales or new store
guidance, including under the section “Fiscal Year 2026 Outlook” and our ability to deliver on such financial outlook are
forward-looking statements. Investors are cautioned that any such forward-looking statements are subject to the finalization of the Company’s
quarter-end financial and accounting procedures, are not guarantees of future performance or results, and are inherently subject to risks
and uncertainties, some of which cannot be predicted or quantified. Actual results or developments may differ materially from those included
in the forward-looking statements as a result of various factors which are discussed in our Annual Reports and Quarterly Reports on Forms
10-K and 10-Q, respectively, and any amendments thereto, filed with the Securities and Exchange Commission. These risks and uncertainties
include, but are not limited to, uncertainties relating to general economic conditions, including inflation, energy and fuel costs, unemployment
levels, and any deterioration whether caused by acts of war, terrorism, political or social unrest (including any resulting store closures,
damage or loss of inventory) or other factors; changes in market interest rates and market levels of wages; the imposition of new taxes
on imports, new tariffs and changes in existing tariff rates; the imposition of new trade restrictions and changes in existing trade restrictions
or trade relationships; impacts of natural disasters such as hurricanes; uncertainty and economic impact of pandemics, epidemics or other
public health emergencies; transportation and distribution delays or interruptions; changes in freight rates; the Company’s ability
to attract and retain workers; the Company’s ability to negotiate effectively the cost and purchase of merchandise inventory risks
due to shifts in market demand and to manage inventory shrinkage; the Company’s ability to gauge fashion trends and changing consumer
preferences; consumer confidence and changes in consumer spending patterns; competition within the industry; competition in the Company’s
markets; the duration and extent of any economic stimulus programs; changes in product mix; interruptions in suppliers’ businesses;
risks related to cybersecurity, data privacy and intellectual property; temporary changes in demand due to weather patterns; seasonality
of the Company’s business; the results of pending or threatened litigation; delays associated with building, remodeling, opening
and operating new stores; and delays associated with building, and opening or expanding new or existing distribution centers. Any forward-looking
statements by the Company, with respect to guidance, the repurchase of shares pursuant to a share repurchase program, or otherwise, are
intended to speak only as of the date such statements are made. Except as required by applicable law, including the securities laws
of the United States and the rules and regulations of the Securities and Exchange Commission, the Company does not undertake to publicly
update any forward-looking statements in this news release or with respect to matters described herein, whether as a result of any new
information, future events or otherwise.
Contact:
Tom Filandro
ICR, Inc.
CitiTrendsIR@icrinc.com
CITI TRENDS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
(in thousands, except per share data)
| | |
Fourth Quarter | |
| | |
2025 | | |
2024 | | |
2023 | |
| Net sales | |
$ | 230,393 | | |
$ | 211,172 | | |
$ | 215,179 | |
| | |
| | | |
| | | |
| | |
| Cost of sales (exclusive of depreciation shown separately below) | |
| (138,463 | ) | |
| (127,326 | ) | |
| (130,997 | ) |
| Selling, general and administrative expenses | |
| (80,033 | ) | |
| (77,451 | ) | |
| (74,527 | ) |
| Depreciation | |
| (4,937 | ) | |
| (4,491 | ) | |
| (4,850 | ) |
| Asset impairment | |
| (252 | ) | |
| (701 | ) | |
| (873 | ) |
| Gain on Insurance | |
| 482 | | |
| — | | |
| — | |
| Income (loss) from operations | |
| 7,190 | | |
| 1,203 | | |
| 3,931 | |
| Interest income | |
| 605 | | |
| 531 | | |
| 1,070 | |
| Interest expense | |
| (87 | ) | |
| (81 | ) | |
| (78 | ) |
| Income (loss) before income taxes | |
| 7,708 | | |
| 1,653 | | |
| 4,923 | |
| Income tax expense | |
| (296 | ) | |
| (15,830 | ) | |
| (1,372 | ) |
| Net income (loss) | |
$ | 7,412 | | |
$ | (14,177 | ) | |
$ | 3,551 | |
| | |
| | | |
| | | |
| | |
| Basic net income (loss) per common share | |
$ | 0.91 | | |
$ | (1.71 | ) | |
$ | 0.43 | |
| Diluted net income (loss) per common share | |
$ | 0.88 | | |
$ | (1.71 | ) | |
$ | 0.42 | |
| | |
| | | |
| | | |
| | |
| Weighted average number of shares outstanding | |
| | | |
| | | |
| | |
| Basic | |
| 8,113 | | |
| 8,314 | | |
| 8,238 | |
| Diluted | |
| 8,411 | | |
| 8,314 | | |
| 8,380 | |
| | |
Fiscal Year | |
| | |
January 31,
2026 | | |
February 1,
2025 | | |
February 3,
2024 | |
| | |
(unaudited) | | |
(unaudited) | | |
(unaudited) | |
| Net sales | |
$ | 819,962 | | |
$ | 753,079 | | |
$ | 747,941 | |
| | |
| | | |
| | | |
| | |
| Cost of sales (exclusive of depreciation shown separately below) | |
| (495,320 | ) | |
| (471,036 | ) | |
| (462,824 | ) |
| Selling, general and administrative expenses | |
| (313,171 | ) | |
| (300,173 | ) | |
| (284,530 | ) |
| Depreciation | |
| (18,482 | ) | |
| (18,822 | ) | |
| (18,990 | ) |
| Asset impairment | |
| (579 | ) | |
| (2,536 | ) | |
| (1,051 | ) |
| Gain on sale of building | |
| 10,960 | | |
| — | | |
| — | |
| Gain on insurance | |
| 482 | | |
| — | | |
| — | |
| Income (loss) from operations | |
| 3,852 | | |
| (39,488 | ) | |
| (19,454 | ) |
| Interest income | |
| 1,993 | | |
| 2,473 | | |
| 3,874 | |
| Interest expense | |
| (342 | ) | |
| (319 | ) | |
| (306 | ) |
| Income (loss) before income taxes | |
| 5,503 | | |
| (37,334 | ) | |
| (15,886 | ) |
| Income tax (expense) benefit | |
| (296 | ) | |
| (5,836 | ) | |
| 3,907 | |
| Net income (loss) | |
$ | 5,207 | | |
$ | (43,170 | ) | |
$ | (11,979 | ) |
| | |
| | | |
| | | |
| | |
| Basic net income (loss) per common share | |
$ | 0.65 | | |
$ | (5.19 | ) | |
$ | (1.46 | ) |
| Diluted net income (loss) per common share | |
$ | 0.63 | | |
$ | (5.19 | ) | |
$ | (1.46 | ) |
| | |
| | | |
| | | |
| | |
| Weighted average number of shares outstanding | |
| | | |
| | | |
| | |
| Basic | |
| 8,057 | | |
| 8,315 | | |
| 8,221 | |
| Diluted | |
| 8,300 | | |
| 8,315 | | |
| 8,221 | |
CITI TRENDS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
| | |
January 31,
2026 | | |
February 1,
2025 | |
| Assets: | |
| | | |
| | |
| Cash and cash equivalents | |
$ | 66,092 | | |
$ | 61,085 | |
| Inventory | |
| 113,515 | | |
| 122,640 | |
| Prepaid and other current assets | |
| 13,441 | | |
| 13,335 | |
| Property and equipment, net | |
| 54,384 | | |
| 50,715 | |
| Operating lease right of use assets | |
| 221,775 | | |
| 214,148 | |
| Other noncurrent assets | |
| 1,964 | | |
| 846 | |
| Total assets | |
$ | 471,171 | | |
$ | 462,769 | |
| | |
| | | |
| | |
| Liabilities and Stockholders' Equity: | |
| | | |
| | |
| Accounts payable | |
$ | 100,693 | | |
$ | 102,456 | |
| Current operating lease liabilities | |
| 44,397 | | |
| 47,724 | |
| Accrued liabilities | |
| 27,934 | | |
| 23,823 | |
| Other current liabilities | |
| 383 | | |
| 388 | |
| Noncurrent operating lease liabilities | |
| 178,921 | | |
| 172,675 | |
| Other noncurrent liabilities | |
| 2,523 | | |
| 2,527 | |
| Total liabilities | |
| 354,851 | | |
| 349,593 | |
| | |
| | | |
| | |
| Total stockholders' equity | |
| 116,320 | | |
| 113,176 | |
| Total liabilities and stockholders' equity | |
$ | 471,171 | | |
$ | 462,769 | |
CITI TRENDS, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited)
(in thousands, except per share data)
The Company uses certain financial measures, including adjusted SG&A, adjusted net income (loss), adjusted EBITDA, and adjusted EBITDA margin to understand and evaluate the Company’s current operating performance and to allow for period-to-period comparisons. The Company believes these non-GAAP financial measures provide meaningful supplemental information about our financial results to investors. These non-GAAP measures may not be comparable to similarly titled non-GAAP measures of other companies and should be considered in addition to and not as a substitute for, or superior to, any measure of performance, cash flow or liquidity prepared in accordance with GAAP. These Non-GAAP measures have no standardized meanings and are not defined by GAAP. The Company is providing a reconciliation of each of these non-GAAP financial measures to their most comparable financial measures on a GAAP basis.
| | |
Fourth Quarter | |
| | |
January 31,
2026 | | |
February 1,
2025 | |
| Reconciliation of Adjusted SG&A | |
| | | |
| | |
| SG&A | |
$ | (80,033 | ) | |
$ | (77,451 | ) |
| Severance1 | |
| — | | |
| 653 | |
| Shareholder matters4 | |
| — | | |
| 50 | |
| Adjusted SG&A | |
$ | (80,033 | ) | |
$ | (76,748 | ) |
| | |
Fourth Quarter | |
| | |
January 31,
2026 | | |
February 1,
2025 | |
| Reconciliation of Adjusted Net Income (Loss) | |
| | | |
| | |
| Net income (loss) | |
$ | 7,412 | | |
$ | (14,177 | ) |
| Gain on insurance | |
| (482 | ) | |
| — | |
| Asset impairment | |
| 252 | | |
| 701 | |
| Severance1 | |
| — | | |
| 653 | |
| Shareholder matters4 | |
| — | | |
| 50 | |
| Adjusted net income (loss) | |
$ | 7,182 | | |
$ | (12,773 | ) |
| | |
Fourth Quarter | |
| | |
January 31,
2026 | | |
February 1,
2025 | |
| Reconciliation of Adjusted EBITDA | |
| | | |
| | |
| Net income (loss) | |
$ | 7,412 | | |
$ | (14,177 | ) |
| Interest income | |
| (605 | ) | |
| (531 | ) |
| Interest expense | |
| 87 | | |
| 81 | |
| Income tax expense | |
| 296 | | |
| 15,830 | |
| Depreciation | |
| 4,937 | | |
| 4,491 | |
| Gain on insurance | |
| (482 | ) | |
| — | |
| Asset impairment | |
| 252 | | |
| 701 | |
| Severance1 | |
| — | | |
| 653 | |
| Shareholder matters4 | |
| — | | |
| 50 | |
| Adjusted EBITDA | |
$ | 11,897 | | |
$ | 7,098 | |
| | |
Fiscal Year | |
| | |
January 31,
2026 | | |
February 1,
2025 | |
| Reconciliation of Adjusted SG&A | |
| | | |
| | |
| SG&A | |
$ | (313,171 | ) | |
$ | (300,173 | ) |
| Lease termination fee5 | |
| 390 | | |
| — | |
| Severance1 | |
| 388 | | |
| 653 | |
| Shareholder matters4 | |
| 146 | | |
| 1,746 | |
| Cyber incident expenses3 | |
| (597 | ) | |
| 36 | |
| CEO transition expenses2 | |
| — | | |
| 1,479 | |
| Adjusted SG&A | |
$ | (312,844 | ) | |
$ | (296,259 | ) |
| | |
Fiscal Year | |
| | |
January 31,
2026 | | |
February 1,
2025 | |
| Reconciliation of Adjusted Net income (loss) | |
| | | |
| | |
| Net income (loss) | |
$ | 5,207 | | |
$ | (43,170 | ) |
| Gain on sale of building | |
| (10,960 | ) | |
| — | |
| Gain on insurance | |
| (482 | ) | |
| — | |
| Asset impairment | |
| 579 | | |
| 2,536 | |
| Lease termination fee5 | |
| 390 | | |
| — | |
| Severance1 | |
| 388 | | |
| 653 | |
| Shareholder matters4 | |
| 146 | | |
| 1,746 | |
| Cyber incident expenses3 | |
| (597 | ) | |
| 36 | |
| CEO transition expenses2 | |
| — | | |
| 1,479 | |
| Adjusted net loss | |
$ | (5,329 | ) | |
$ | (36,720 | ) |
| | |
Fiscal Year | |
| | |
January 31,
2026 | | |
February 1,
2025 | |
| Reconciliation of Adjusted EBITDA | |
| | | |
| | |
| Net income (loss) | |
$ | 5,207 | | |
$ | (43,170 | ) |
| Interest income | |
| (1,993 | ) | |
| (2,473 | ) |
| Interest expense | |
| 342 | | |
| 319 | |
| Income tax expense | |
| 296 | | |
| 5,836 | |
| Depreciation | |
| 18,482 | | |
| 18,822 | |
| Gain on sale of building | |
| (10,960 | ) | |
| — | |
| Gain on insurance | |
| (482 | ) | |
| — | |
| Asset impairment | |
| 579 | | |
| 2,536 | |
| Lease termination fee5 | |
| 390 | | |
| — | |
| Severance1 | |
| 388 | | |
| 653 | |
| Shareholder matters4 | |
| 146 | | |
| 1,746 | |
| Cyber incident expenses3 | |
| (597 | ) | |
| 36 | |
| CEO transition expenses2 | |
| — | | |
| 1,479 | |
| Adjusted EBITDA | |
$ | 11,798 | | |
$ | (14,216 | ) |
1 Represents severance and related costs resulting from the CEO transition and subsequent implementation of CEO-led organizational changes.
2 Represents costs associated with the hiring of a new CEO.
3 Represents costs associated with the cyber disruption of the Company's back office and distribution center IT systems in January 2023.
4 Represents costs related to requests and inquiries from a significant shareholder.
5 Represents a lease termination fee associated with the closure of a store.
Beginning in 2026 the Company will update its definition of Adjusted EBITDA and Adjusted SG&A to include an addback of equity-based compensation expense because equity-based compensation is a non-cash expense that the Company does not use to assess core profitability and the Company believes excluding equity-based compensation will improve comparability and provide greater transparency of cash generated from operations. The Company is providing the following reconciliations of Adjusted EBITDA and Adjusted SG&A under the new methodology to present the effects of the change in methodology. These reconciliations should be read together with the reconciliations of Adjusted EBITDA and Adjusted SG&A under the current methodology.
| | |
Fiscal Year | |
| |
January 31,
2026 | |
| Reconciliation of Adjusted SG&A (New Methodology) | |
| | |
| Adjusted SG&A (Current Methodology) | |
$ | (312,844 | ) |
| Equity-based compensation | |
| 5,389 | |
| Adjusted SG&A (New Methodology) | |
$ | (307,455 | ) |
| | |
Fiscal Year | |
| | |
January 31,
2026 | |
| Reconciliation of Adjusted EBITDA (New Methodology) | |
| | |
| Adjusted EBITDA (Current Methodology) | |
$ | 11,798 | |
| Equity-based compensation | |
| 5,389 | |
| Adjusted EBITDA (New Methodology) | |
$ | 17,187 | |
| | |
Fiscal Year | |
| | |
January 31,
2026 | |
| Adjusted EBITDA Margin | |
| | |
| Sales | |
$ | 819,962 | |
| Adjusted EBITDA (New Methodology) | |
| 17,187 | |
| Adjusted EBITDA margin | |
| 2.1 | % |
