Citi Trends, Inc. ( CTRN ) shares are trading lower in the premarket session on Tuesday after reporting mixed first-quarter results and revised full year 2024 outlook.

The company reported quarterly sales of $186.3 million, which increased by 3.7% year over year. However, sales missed the Wall Street view of $187.37 million.

Citi Trends ( CTRN ) closed three stores and remodeled 20 stores to end the quarter with 599 locations.

“We are mindful of the challenging economic environment for the lower-income consumer,” said Interim Chief Executive Officer Ken Seipel.

The company registered comparable sales growth of 3.1%, with gross margin at 38.7%. “The quarter was further highlighted by gross margin expansion of 160 basis points compared to last year,” Seipel said. 

Citi Trends ( CTRN ) reported an adjusted EBITDA loss of $0.8 million, narrower than an adjusted loss of $3.2 million in the year-ago period.

Citi Trends ( CTRN ) had cash of $58.2 million at quarter-end, with no debt and no borrowings under a $75 million credit facility.

“Our balance sheet has ample liquidity and no debt because of our financial disciplines, which in turn allows us the flexibility to fund business opportunities with acceptable rates of returns,” Seipel added. 

Citi Trends ( CTRN ) reported an adjusted loss per share of 32 cents, better than the consensus loss of 35 cents.

Last week, the specialty value retailer disclosed that David Makuen has stepped down as CEO and a member of the Board. The Board said it will consider external candidates, as well as Seipel, in the CEO search.

Outlook Lowered: Citi Trends ( CTRN ) lowered its FY24 comparable store sales outlook. The company projects growth of low to mid-single digits (prior view: growth of mid-single digits) and sees gross margin expansion of 75-100 basis points, consistent with previous outlook.

The company continues to see full-year EBITDA in the range of $4 million to $10 million.

“We will execute the business initiatives within our control that will position us to achieve our EBITDA target for the year,” Seipel said.

Price Action: CTRN shares are trading lower by 3.65% at $23.75 premarket at last check Tuesday.