Tilly’s Comps Rise 12.1% as Ecommerce Growth Supports Profit Recovery

Online sales rose 20.9% to $34.5 million and accounted for 21.1% of revenue, compared with 18.9% a year earlier. Physical-store comparable sales increased 10.3%. The retailer ended the quarter with 220 stores, 12 fewer than a year earlier.

Growth in both existing stores and ecommerce shows a broader demand improvement rather than sales being lifted by new openings. Selling more through a smaller estate also improves the productivity of the remaining network. Gross margin improved 300 basis points to 35.5%.

Tilly’s attributed the change to higher product margins and spreading buying, distribution and occupancy costs across increased sales. Operating income rose to $8.2 million from $2.7 million, while net income reached $8.4 million, or $0.27 per diluted share.

The momentum continued into fiscal August, when comparable sales increased 14.6%. Management said that marked 13 consecutive months of comparable-sales growth…