When Michaels Companies Inc. (NASDAQ: MIK) reported its fiscal fourth-quarter financial results before the markets opened on Tuesday, the craft store posted $1.44 in earnings per share (EPS) and $1.79 billion in revenue. That compares with consensus estimates of $1.42 in EPS and $1.78 billion in revenue, as well as the $1.19 per share and $1.89 billion posted in the same period of last year.
The decrease in net sales in the fourth quarter was primarily due to the extra week in the fourth quarter of fiscal 2017, the closure of all 94 full-size Aaron Brothers stores in the first quarter of fiscal 2018, and a 0.4% decline (flat on a constant currency basis) in comparable store sales.
Sales from the operation of 20 additional Michaels stores (net of closures) during the quarter partially offset the decrease in net sales. During the quarter, the company opened three new Michaels stores, closed one Michaels store, relocated one Michaels store and closed 36 Pat Catan’s stores.
Looking ahead to the fiscal first quarter, management expects to see EPS in the range of $0.28 to $0.33 and comparable store sales to decrease in the low single-digit range. Consensus estimates call for $0.40 in EPS and $1.14 billion in revenue for the quarter.
Interim CEO Mark Cosby commented:
A few weeks ago, I joined The Michaels Companies, a retailer I have long admired as a customer. While I am still getting to know the customer, the operations and the team, I am excited about the long-term opportunities we have to engage with makers of all experience levels and expand our leadership position within the arts and crafts retail industry.
Shares of Michaels were last seen up about 13% at $13.37, in a 52-week range of $11.44 to $22.15. The consensus price target is $17.36.