8-K
BRAND HOUSE COLLECTIVE, INC. (TBHC)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
| Date of Report (Date of Earliest Event Reported): | June 17, 2025 |
|---|
Kirkland's, Inc.
(Exact name of registrant as specified in its charter)
| Tennessee | 000-49885 | 62-1287151 |
|---|---|---|
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
| 5310 Maryland Way, Brentwood, Tennessee | 37027 | |
| (Address of principal executive offices) | (Zip Code) | |
| Registrant’s telephone number, including area code: | 615-872-4800 | |
| --- | --- |
Not Applicable
(Former name or former address, if changed since last report.)
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:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock | KIRK | NASDAQ Global Select Market |
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).
Emerging growth company ☐
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. ☐
Item 2.02 Results of Operations and Financial Condition.
On June 17, 2025, Kirkland’s, Inc. (“the Company”) issued a press release reporting its results of operations for the first fiscal quarter ended May 3, 2025 (the “Press Release”).
A copy of the Press Release is attached hereto as Exhibit 99.1, and is being furnished, not filed, under Item 2.02 of this Current Report on Form 8-K.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Director Appointments
On June 17, 2025, the Company’s Board of Directors (the “Board”) appointed Eric Schwartzman, Neely Tamminga, Tamara Ward and Steve Woodward (collectively, the “New Directors”) to the Board, effective June 24, 2025. Ms. Ward and Mr. Woodward were nominated by Beyond, Inc. (“Beyond”) in accordance with the terms of the Amended and Restated Investor Rights Agreement, dated May 7, 2025, filed as Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on May 12, 2025.
Mr. Schwartzman serves as Senior Vice President and Chief Financial Officer of Now Optics, d/b/a Stanton Optical, a technology enabled, omni-channel eye care retailer with over 300 locations, having held such position since 2023. Prior to that time, Mr. Schwartzman served from 2021 to 2023 as the Chief Financial Officer of The Paper Store, a multi-location, omni-channel gift retailer; and from 2012 to 2020 was Vice President, Strategy, Finance & Supply Chain Performance Management of Bed, Bath & Beyond Inc., having held various positions within Bed, Bath & Beyond, Inc. beginning in 2003. Mr. Schwartzman earned his Bachelor of Science in Business Administration a Master of Business Administration from Washington University, St. Louis in 1993 and 1994, respectively. Mr. Schwartzman has held various management and finance related positions with numerous retail businesses for over thirty years providing the extensive knowledge and experience of finance and accounting matters applicable to omni-channel retail businesses. Mr. Schwartzman will serve on the Board’s audit committee and governance and nominating committee.
Ms. Tamminga is the Co-Founder and CEO of Distill, a privately-owned management advisory firm focused on helping its business clients understand the consumer economy, a position she has held since 2017. Prior to launching Distill, Ms. Tamminga worked for more than twenty years for two Wall Street firms including Piper Jaffray & Co. (now Piper Sandler) and A.G. Edwards & Sons, Inc. covering the consumer sector where she advised institutional and private equity investors in their investment decisions. During Ms. Tamminga’s tenure at Piper Jaffray & Co. from 2002 through 2017, she served as the Managing Director, Senior Research Analyst, and Head of the Consumer Equity Research group. For the past five years, Ms. Tamminga has served as Assistant Professor and Director of the School of Business & Leadership at North Central University in Minneapolis teaching undergraduate and graduate-level courses in finance, economics, and leadership. Ms. Tamminga earned her Bachelor of Arts in Economics from Calvin College in 1996, and a Master of Business Administration from St. Louis University, in 2000. Ms. Tamminga will serve on the Board’s audit committee and compensation committee.
Ms. Ward is a Principal at Ward Solutions, LLC, a private business consulting firm, since 2024. She was previously a Senior Advisor from 2023 to 2024 at Camping World Holdings, Inc., a publicly traded company and the world’s largest retailer of RVs and related products and services. She also served as a Senior Marketing Strategy Consultant at Beyond in 2024. From 1989 until 2022, she held various positions within Camping World Holdings, Inc., including Chief Marketing Officer from 2011 to 2017, Executive Vice President of Corporate Development from 2017 to 2019, and Chief Operating Officer from 2019 to 2022. Ms. Ward earned a Bachelor of Science in Marketing from Western Kentucky University in 1990. Ms. Ward will serve on the Board’s audit committee, compensation committee and governance and nominating committee.
Mr. Woodward was previously Chief Executive Officer and a member of the Board of Directors of the Company from 2018 until 2023. From 2015 until 2018, Mr. Woodward served as the President and Chief Merchandising Officer of the global home furnishings retailer Crate and Barrel, where he was responsible for all aspects of merchandising for the global omni-channel home furnishings retailer. From 2007 to 2015, Mr. Woodward was Senior Vice President of Licensed Watches and Jewelry for Fossil, where he was head of the Michael Kors watch and jewelry business. Before joining Fossil, Mr. Woodward held several key executive roles in the home furnishings industry, including Executive Vice President and General Merchandise Manager of The Bombay Company, Chief Executive Officer of Illuminations and Vice President of Pier 1 Imports.
The Company is not aware of any related party transactions or relationships between the New Directors and the Company that would require disclosure under Item 404(a) of Regulation S-K. With the exception of Ms. Ward and Mr. Woodward, the New Directors were not appointed as directors based on any arrangement or understanding between the New Directors and any other persons. Given that Mr. Woodward previously served as the Company’s Chief Executive Officer as recently as May 2023, the Board has determined that he is not independent in accordance with the director independence standards established under the Company’s Corporate Governance Guidelines, which are intended to comply with the Nasdaq Stock Market LLC’s corporate governance rules, and all other applicable laws, rules and regulations. The New Directors will be compensated in accordance with the Company’s standard compensation policies and practices for the Board.
On June 17, 2025, the Company issued a press release announcing the appointment of the New Directors, a copy of which is attached hereto as Exhibit 99.2, and is incorporated by reference herein.
Director Resignations
On June 12, 2025, (i) Susan Lanigan informed the Company of her decision to resign from the Board, effectively immediately and (ii) the Board approved a decrease in the size of the Board from six to five members. Ms. Lanigan’s decision to resign from the Board was not the result of any disagreement with the Company.
On June 17, 2025, Ann Joyce, Charlie Pleas III, Chris Shimojima and Jill Soltau (collectively, the “Former Directors”) informed the Company of their intention to resign from the Board, effective as of June 24, 2025. The Former Directors’ decision to resign from the Board was not the result of any disagreement with the Company.
Item 8.01 Other Information.
On June 17, 2025, the Company issued a press release announcing its plans to change the Company’s corporate name from “Kirkland’s, Inc.” to “The Brand House Collective, Inc.” pending shareholder approval at the Company’s upcoming Annual Meeting of Shareholders on July 24, 2025. In conjunction with its corporate name change, the Company will change its ticker symbol on the Nasdaq Global Select Market from “KIRK” to “TBHC”. Once effective, the “KIRK” trading symbol will no longer be active. No action is needed from the Company’s current shareholders relative to the ticker symbol change.
A copy of the press release is attached hereto as Exhibit 99.2, and is being furnished, not filed, under Item 8.01 of this Current Report on Form 8-K.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit<br><br> <br>Number | Description |
|---|---|
| 99.1 | Press Release dated June 17, 2025 announcing the Company’s first fiscal quarter financial results. |
| 99.2 | Press Release dated June 17, 2025 announcing the Company’s plans to rebrand Kirkland’s, Inc. to The Brand House Collective, Inc. |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
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 hereunto duly authorized.
| Kirkland's, Inc. | ||
|---|---|---|
| June 17, 2025 | By: | /s/ W. Michael Madden |
| **** | Name: W. Michael Madden | |
| **** | Title: Executive Vice President and Chief Financial Officer |
ex_808763.htm
Exhibit 99.1
KIRKLAND’S REPORTS First QUARTER FISCAL 2025 RESULTS
Announces Decisive Transformation, Corporate Reorganization, and Changes to the Board of Directors
NASHVILLE, Tenn. (June 17, 2025) — Kirkland’s, Inc. (Nasdaq: KIRK) (“Kirkland’s” or the “Company”), a multi-brand specialty retailer of home décor, housewares and furnishings, announced financial results for the 13-week period ended May 3, 2025.
First Quarter 2025 Summary
| ● | Net sales of $81.5 million; consolidated comparable sales decreased 8.9%, inclusive of comparable store decline of 3.1% and e-commerce decline of 26.7% compared to the first quarter of fiscal 2024. |
|---|---|
| ● | Gross profit margin of 24.9%. |
| --- | --- |
| ● | Operating loss of $10.5 million. |
| --- | --- |
| ● | Adjusted EBITDA loss of $7.9 million. |
| --- | --- |
| ● | Closed 3 stores during the period to end the quarter with 314 stores. |
| --- | --- |
Management Commentary
Amy Sullivan, CEO of Kirkland’s, said, “Like many in retail, our first quarter performance was impacted by weather and the continued softness in consumer sentiment. Despite these challenges, we saw improvements in our store performance for the combined March and April period. While our e-commerce business remains pressured, and was exacerbated in late May by weather-related disruptions in our Jackson, Tennessee distribution center, we continue to see momentum in our Kirkland’s Home stores which saw comparable store sales up approximately 3% versus last year for the month of May. While encouraged by our store performance, it is time to accelerate our transformation. We have already begun to take actions in moving excess and slower turning inventory in the first quarter and will continue the elimination of underperforming assets as we expand the utilization of our Bed Bath & Beyond, Overstock and buybuy Baby licenses.”
Ms. Sullivan continued, “As announced today, we are entering a new era in our organization as we reimagine our future as a multi-brand retail operator maximizing our partnership with Beyond. We are realigning our business to drive performance and profitability - strengthening our team, sharpening our operational discipline to improve inventory productivity, and accelerating the brand conversion or closure of underperforming assets across our portfolio. While we expect these decisive actions and the optimization of our assets to impact near-term performance, we believe rebuilding our foundation will unlock significant operating leverage, drive sustainable profitable growth and create long-term value for our shareholders.”
First Quarter 2025 Financial Results
Net sales in the first quarter of 2025 were $81.5 million, compared to $91.8 million in the prior year quarter. The decrease was primarily driven by a decline in e-commerce sales and comparable store sales, along with a decline in store count of approximately 5%. Comparable sales decreased 8.9% compared to the first quarter of 2024, including a 3.1% decrease in comparable store sales and a 26.7% decline in e-commerce sales. The decrease in comparable sales was primarily driven by a decrease in consolidated average ticket and e-commerce traffic, partially offset by an increase in store conversion.
Gross profit in the first quarter of 2025 was $20.3 million, or 24.9% of net sales, compared to $27.1 million, or 29.5% of net sales in the prior year quarter. The decline is primarily a result of lower merchandise margins, due to higher promotional activity, and the deleverage of store occupancy costs, partially offset by lower outbound freight costs.
Operating expenses in the first quarter of 2025 were $30.8 million, or 37.8% of net sales, compared to $34.6 million, or 37.7% of net sales in the prior year quarter. The decline in operating expenses was driven by lower store and corporate compensation and benefits expenses, reduced advertising costs and lower consulting costs.
Operating loss in the first quarter of 2025 was $10.5 million compared to $7.5 million in the prior year quarter. Adjusted operating loss in the first quarter of 2025 was $10.0 million compared to $7.1 million in the prior year quarter. Adjusted operating loss removes the impact of asset impairment, stock-based compensation expense, severance charges and any financing related legal or professional fees that, due to their nature, did not qualify for capitalization as deferred debt or equity issuance costs.
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Net loss in the first quarter of 2025 was $11.8 million, or a loss of $0.54 per diluted share, compared to $8.8 million, or a loss of $0.68 per diluted share in the prior year quarter. Diluted weighted average shares outstanding in the first quarter of 2025 were approximately 22.1 million compared to 13.0 million in the prior year quarter, mainly due to Beyond, Inc. (“Beyond”) acquiring approximately 8.9 million shares of common stock in the Company.
EBITDA in the first quarter of 2025 was a loss of $8.4 million compared to a loss of $4.9 million in the prior year quarter. Adjusted EBITDA in the first quarter of 2025 was a loss of $7.9 million compared to a loss of $4.5 million in the prior year quarter. Adjusted EBITDA removes the impact of asset impairment, stock-based compensation expense, severance charges and any financing related legal or professional fees that, due to their nature, did not qualify for capitalization as deferred debt or equity issuance costs.
Adjusted diluted net loss in the first quarter of 2025 was $11.3 million, or an adjusted loss of $0.51 per diluted share, compared to adjusted net loss of $8.4 million, or an adjusted loss of $0.65 per diluted share in the prior year quarter. Adjusted net loss removes the impact of asset impairment, stock-based compensation expense, severance charges and any financing related legal or professional fees not subject to capitalization.
Balance Sheet
As of May 3, 2025, inventory was $76.4 million, a 0.8% increase compared to the prior year period.
As of May 3, 2025, the Company had a cash balance of $3.5 million, with $38.9 million of outstanding debt and $5.1 million in outstanding letters of credit under its senior secured revolving credit facility and $8.5 million in debt to Beyond a related party and 40% owner of the Company. As of May 3, 2025, the Company had minimal availability for borrowing under the revolving credit facility, after the minimum required excess availability covenant.
Availability under the Company’s revolving credit facility fluctuates largely based on eligible inventory levels, and as eligible inventory increases in the second and third fiscal quarters in support of the Company’s back-half sales plans, the Company’s borrowing capacity increases correspondingly.
Credit Agreement Expansion
On May 7, 2025, the Company closed a $5.2 million expansion of the existing credit agreement with Beyond and amended existing transactions and collaboration agreements previously entered into between the companies.
In connection with the financing, Kirkland’s has also received a waiver from both its lenders, Bank of America, N.A. and Beyond as expected per the recent Form 8-K filing on May 1, 2025. The Company’s senior credit agreement with Bank of America, N.A. was also amended to permit Beyond to acquire up to 65% of the outstanding capital stock of the Company. In addition to the expanded credit facility, Beyond and the Company have entered into a purchase agreement providing for the future sale of the Company’s intellectual property to Beyond, subject to senior lender approvals.
As of June 17, 2025, the Company had $38.8 million of outstanding debt and $5.1 million of outstanding letters of credit under its revolving credit facility with minimal availability, after the minimum required excess availability covenant, and $13.7 million in term loans to Beyond.
Jackson, Tennessee Distribution Center Disruption
On May 20, 2025, a tornado hit the Company’s leased Jackson, Tennessee distribution center, causing damage to the Company’s assets and disruptions to the Company's operations, particularly with respect to its e-commerce channel. The Company maintains insurance policies to cover the repair or replacement of the Company’s assets that suffered loss or damage, and the Company is working closely with its insurance carriers to ascertain the full amount of insurance proceeds, net of the deductible on the policies, due to the Company as a result of the damages and interruption to its business. At this time, the amount of combined property damage and business interruption costs and recoveries cannot be estimated.
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Transformative Operational Reset, Board Refreshment and Corporate Rebranding
Today, in a separate announcement, the Company announced a number of operational and leadership changes as well as a refreshment of the Board of Directors focused on driving transformation, performance and profitability. The Company detailed its plans to rebrand Kirkland’s, Inc. to The Brand House Collective reflecting the Company’s transformation into a multi-brand merchandising, supply chain and retail operator leading the brick & mortar vision and strategy for Beyond’s growing portfolio of iconic home and family brands. Kirkland’s, Inc. plans to officially change its corporate name from “Kirkland’s, Inc.” to “The Brand House Collective, Inc.” pending shareholder approval at the Company’s upcoming annual meeting on July 24, 2025. In conjunction with its corporate name change, the Company’s ticker symbol on the Nasdaq Global Select Market from “KIRK” to “TBHC”. Once effective, the “KIRK” trading symbol will no longer be active. No action is needed from the Company’s current shareholders relative to the ticker symbol change.
In addition, the Company announced changes to its Board of Directors. The press release is available in the investor relations section of the Company’s website at www.kirklands.com.
Conference Call
Given the strategic and organizational changes, the Company is undergoing, the Company has cancelled its first quarter fiscal 2025 results conference call, originally scheduled for today, June 17, 2025 at 9:00 a.m. Eastern Time.
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About Kirkland’s, Inc.
Kirkland’s, Inc. is a specialty retailer of home décor and furnishings in the United States, currently operating 313 stores in 35 states as well as an e-commerce website, www.kirklands.com, under the Kirkland’s Home brand. The Company provides its customers an engaging shopping experience characterized by a curated, affordable selection of home décor and furnishings along with inspirational design ideas. This combination of quality and stylish merchandise, value pricing and a stimulating in-store and online environment provides the Company’s customers with a unique brand experience. More information can be found at www.kirklands.com.
Forward-Looking Statements
Except for historical information contained herein, certain statements in this release, constitute forward-looking statements that are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are subject to the finalization of the Company’s quarterly financial and accounting procedures. Forward-looking statements deal with potential future circumstances and developments and are, accordingly, forward-looking in nature. You are cautioned that such forward-looking statements, which may be identified by words such as "anticipate," "believe," "expect," "estimate," "intend," "plan," "seek," "may," "could," "strategy," and similar expressions, involve known and unknown risks and uncertainties, many of which are outside of the Company’s control, which may cause the Company's actual results to differ materially from forecasted results. Those risks and uncertainties include, among other things, risks associated with the effect of the transactions entered into with Beyond (the “Transactions”) on the Company’s business relationships; operating results and business generally; unexpected costs, charges or expenses resulting from the Transactions; potential litigation relating to the Transactions that could be instituted against Beyond, the Company or their affiliates’ respective directors, managers or officers, including the effects of any outcomes related thereto; continued availability of capital and financing; the ability to obtain the various synergies envisioned between the Company and Beyond; the ability of the Company to successfully open new stores or rebrand existing Kirkland’s Home stores under a Bed Bath & Beyond Home or other licensed brand; the ability of the Company to successfully market its products to new customers and expand through new e-commerce platforms and to implement its plans, forecasts and other expectations with respect to its business after the completion of the Transactions and realize additional opportunities for growth and innovation; risks associated with the Company's liquidity including cash flows from operations and the amount of borrowings under the secured revolving credit facility; the fact that our independent registered public accounting firm’s report for the year ended February 1, 2025 is qualified as to our ability to continue as a going concern; the Company’s ability to successfully implement cost savings and other strategic initiatives intended to improve operating results and liquidity positions; the Company’s actual and anticipated progress towards its short-term and long-term objectives including its multi-brand and omni-channel strategy; the risk that natural disasters, pandemic outbreaks, global political events, war and terrorism could impact the Company’s revenues, inventory and supply chain; the continuing consumer impact of inflation and countermeasures, including high interest rates; the effectiveness of the Company’s marketing campaigns; risks related to changes in U.S. policy related to imported merchandise, particularly with regard to the impact of tariffs on goods imported from China and strategies undertaken to mitigate such impact; the Company’s ability to retain its senior management team; volatility in the price of the Company’s common stock, the competitive environment in the home décor industry in general and in the Company's specific market areas; inflation, fluctuations in cost and availability of inventory; increased transportation costs and potential interruptions in supply chain, distribution systems and delivery network, including the Company’s e-commerce systems and channels; the ability to control employment and other operating costs; availability of suitable retail locations and other growth opportunities; disruptions in information technology systems including the potential for security breaches of the Company's information or its customers’ information, seasonal fluctuations in consumer spending, and economic conditions in general. Those and other risks are more fully described in the Company's filings with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K filed on May 2, 2025, as amended on May 30, 2025, and subsequent reports. Forward-looking statements included in this release are made as of the date of this release. Any changes in assumptions or factors on which such statements are based could produce materially different results. Except as required by law, the Company disclaims any obligation to update any such factors or to publicly announce results of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.
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KIRKLAND’S, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
| 13-Week Period Ended | ||||||
|---|---|---|---|---|---|---|
| May 3, | May 4, | |||||
| 2025 | 2024 | |||||
| Net sales | $ | 81,504 | $ | 91,753 | ||
| Cost of sales | 61,220 | 64,685 | ||||
| Gross profit | 20,284 | 27,068 | ||||
| Operating expenses: | ||||||
| Compensation and benefits | 17,854 | 19,286 | ||||
| Other operating expenses | 12,266 | 14,318 | ||||
| Depreciation (exclusive of depreciation included in cost of sales) | 660 | 961 | ||||
| Asset impairment | 20 | 11 | ||||
| Total operating expenses | 30,800 | 34,576 | ||||
| Operating loss | (10,516 | ) | (7,508 | ) | ||
| Interest expense | 1,348 | 1,127 | ||||
| Other income | (84 | ) | (116 | ) | ||
| Loss before income taxes | (11,780 | ) | (8,519 | ) | ||
| Income tax expense | 44 | 311 | ||||
| Net loss | $ | (11,824 | ) | $ | (8,830 | ) |
| Loss per share: | ||||||
| Basic | $ | (0.54 | ) | $ | (0.68 | ) |
| Diluted | $ | (0.54 | ) | $ | (0.68 | ) |
| Weighted average shares outstanding: | ||||||
| Basic | 22,093 | 12,965 | ||||
| Diluted | 22,093 | 12,965 |
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KIRKLAND’S, INC.
UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands)
| May 3, | February 1, | May 4, | |||||||
|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2025 | 2024 | |||||||
| ASSETS | **** | **** | **** | ||||||
| Current assets: | |||||||||
| Cash and cash equivalents | $ | 3,535 | $ | 3,820 | $ | 3,836 | |||
| Inventories, net | 76,415 | 81,899 | 75,789 | ||||||
| Prepaid expenses and other current assets | 5,241 | 5,585 | 6,540 | ||||||
| Total current assets | 85,191 | 91,304 | 86,165 | ||||||
| Property and equipment, net | 20,466 | 22,062 | 27,737 | ||||||
| Operating lease right-of-use assets | 116,569 | 121,229 | 121,410 | ||||||
| Other assets | 3,183 | 7,593 | 7,271 | ||||||
| Total assets | $ | 225,409 | $ | 242,188 | $ | 242,583 | |||
| LIABILITIES AND SHAREHOLDERS’ DEFICIT | **** | **** | **** | ||||||
| Current liabilities: | |||||||||
| Accounts payable | $ | 39,545 | $ | 43,935 | $ | 39,963 | |||
| Accrued expenses and other liabilities | 20,439 | 20,183 | 23,020 | ||||||
| Operating lease liabilities | 38,532 | 39,355 | 38,590 | ||||||
| Related party debt | 832 | — | — | ||||||
| Current debt, net | — | 49,199 | — | ||||||
| Total current liabilities | 99,348 | 152,672 | 101,573 | ||||||
| Operating lease liabilities | 90,820 | 95,085 | 94,529 | ||||||
| Related party debt, net | 9,028 | — | — | ||||||
| Long-term debt, net | 38,935 | 10,003 | 47,541 | ||||||
| Other liabilities | 3,496 | 3,445 | 4,405 | ||||||
| Total liabilities | 241,627 | 261,205 | 248,048 | ||||||
| Shareholders’ deficit | (16,218 | ) | (19,017 | ) | (5,465 | ) | |||
| Total liabilities and shareholders’ deficit | $ | 225,409 | $ | 242,188 | $ | 242,583 |
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KIRKLAND’S, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(In thousands)
| 13-Week Period Ended | ||||||
|---|---|---|---|---|---|---|
| May 3, | May 4, | |||||
| 2025 | 2024 | |||||
| Cash flows from operating activities: | **** | **** | ||||
| Net loss | $ | (11,824 | ) | $ | (8,830 | ) |
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||
| Depreciation of property and equipment | 2,090 | 2,624 | ||||
| Amortization of debt issuance and original issue discount costs | 406 | 131 | ||||
| Asset impairment | 20 | 11 | ||||
| Gain on disposal of property and equipment | — | (6 | ) | |||
| Stock-based compensation expense | 239 | 292 | ||||
| Changes in assets and liabilities: | ||||||
| Inventories, net | 5,484 | (1,699 | ) | |||
| Prepaid expenses and other current assets | 344 | 1,063 | ||||
| Accounts payable | (4,385 | ) | (5,653 | ) | ||
| Accrued expenses | 285 | (133 | ) | |||
| Operating lease assets and liabilities | (428 | ) | (1,365 | ) | ||
| Other assets and liabilities | 4,692 | (90 | ) | |||
| Net cash used in operating activities | (3,077 | ) | (13,655 | ) | ||
| Cash flows from investing activities: | ||||||
| Proceeds from sale of property and equipment | 10 | 6 | ||||
| Capital expenditures | (568 | ) | (770 | ) | ||
| Net cash used in investing activities | (558 | ) | (764 | ) | ||
| Cash flows from financing activities: | **** | **** | ||||
| Borrowings on revolving line of credit | 3,400 | 9,000 | ||||
| Repayments on revolving line of credit | (7,465 | ) | (4,100 | ) | ||
| Borrowings on FILO term loan | — | 10,000 | ||||
| Payments of debt and equity issuance costs | (534 | ) | (399 | ) | ||
| Cash used in net share settlement of stock options and restricted stock units | (51 | ) | (51 | ) | ||
| Proceeds from issuance of common stock | 8,000 | — | ||||
| Net cash provided by financing activities | 3,350 | 14,450 | ||||
| Cash and cash equivalents: | **** | **** | ||||
| Net (decrease) increase | (285 | ) | 31 | |||
| Beginning of the period | 3,820 | 3,805 | ||||
| End of the period | $ | 3,535 | $ | 3,836 | ||
| Supplemental schedule of non-cash activities: | **** | **** | ||||
| Non-cash accruals for purchases of property and equipment | $ | 325 | $ | 390 | ||
| Non-cash accruals for debt and equity issuance costs | 573 | 860 | ||||
| Conversion of convertible note, accrued interest and unamortized debt issuance costs into common stock | $ | 6,676 | — | |||
| Common stock issued in exchange for equity issuance costs | 574 | — |
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Non-GAAP Financial Measures
To supplement our unaudited consolidated condensed financial statements presented in accordance with generally accepted accounting principles (“GAAP”), this earnings release contains certain non-GAAP financial measures, including EBITDA, adjusted EBITDA, adjusted operating loss, adjusted net loss and adjusted diluted loss per share. These measures are not in accordance with, and are not intended as alternatives to, GAAP financial measures. The Company uses these non-GAAP financial measures internally in analyzing our financial results and believes that they provide useful information to analysts and investors, as a supplement to GAAP financial measures, in evaluating the Company’s operational performance.
The Company defines EBITDA as net loss before income tax expense, interest expense, other income and depreciation. Adjusted EBITDA is defined as EBITDA adjusted to remove asset impairment, stock-based compensation expense, due to the non-cash nature of this expense, severance charges, as it fluctuates based on the needs of the business and does not represent a normal recurring operating expense, and any financing related legal or professional fees that, due to their nature, did not qualify for capitalization as deferred debt or equity issuance costs.
Adjusted operating loss is defined as operating loss adjusted for asset impairment, stock-based compensation expense, severance charges and financing related legal or professional fees not qualifying for capitalization. The Company defines adjusted net loss as net loss adjusted for asset impairment, stock-based compensation expense, severance charges, financing related legal or professional fees not qualifying for capitalization and the related tax adjustments. The Company defines adjusted loss per diluted share as adjusted net loss divided by weighted average diluted share count.
Non-GAAP financial measures are intended to provide additional information only and do not have any standard meanings prescribed by GAAP. Use of these terms may differ from similar measures reported by other companies. Each non-GAAP financial measure has its limitations as an analytical tool, and you should not consider them in isolation or as a substitute for analysis of the Company’s results as reported under GAAP.
The following table shows an unaudited non-GAAP measure reconciliation of net loss to EBITDA and adjusted EBITDA (in thousands) for the periods indicated:
| 13-Week Period Ended | ||||||
|---|---|---|---|---|---|---|
| May 3, 2025 | May 4, 2024 | |||||
| Net loss | $ | (11,824 | ) | $ | (8,830 | ) |
| Income tax expense | 44 | 311 | ||||
| Interest expense | 1,348 | 1,127 | ||||
| Other income | (84 | ) | (116 | ) | ||
| Depreciation | 2,090 | 2,624 | ||||
| EBITDA | (8,426 | ) | (4,884 | ) | ||
| Adjustments: | ||||||
| Asset impairment^(1)^ | 20 | 11 | ||||
| Stock-based compensation expense^(2)^ | 239 | 292 | ||||
| Beyond transaction costs not subject to capitalization^(3)^ | 129 | — | ||||
| Severance charges^(4)^ | 126 | 73 | ||||
| Total adjustments | 514 | 376 | ||||
| Adjusted EBITDA | $ | (7,912 | ) | $ | (4,508 | ) |
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The following table shows an unaudited non-GAAP measure reconciliation of operating loss to adjusted operating loss (in thousands) for the periods indicated:
| 13-Week Period Ended | ||||||
|---|---|---|---|---|---|---|
| May 3, 2025 | May 4, 2024 | |||||
| Operating loss | $ | (10,516 | ) | $ | (7,508 | ) |
| Adjustments: | ||||||
| Asset impairment^(1)^ | 20 | 11 | ||||
| Stock-based compensation expense^(2)^ | 239 | 292 | ||||
| Beyond transaction costs not subject to capitalization^(3)^ | 129 | — | ||||
| Severance charges^(4)^ | 126 | 73 | ||||
| Total adjustments | 514 | 376 | ||||
| Adjusted operating loss | $ | (10,002 | ) | $ | (7,132 | ) |
The following table shows an unaudited non-GAAP measure reconciliation of net loss and diluted loss per share to adjusted net loss and adjusted diluted loss per share (in thousands, except per share data) for the periods indicated:
| 13-Week Period Ended | 13-Week Period Ended | |||||
|---|---|---|---|---|---|---|
| May 3, 2025 | May 4, 2024 | |||||
| Net loss | $ | (11,824 | ) | $ | (8,830 | ) |
| Adjustments: | ||||||
| Asset impairment^(1)^ | 20 | 11 | ||||
| Stock-based compensation expense^(2)^ | 239 | 292 | ||||
| Beyond transaction costs not qualifying for capitalization^(3)^ | 129 | — | ||||
| Severance charges^(4)^ | 126 | 73 | ||||
| Total adjustments | 514 | 376 | ||||
| Tax benefit of adjustments | 10 | 14 | ||||
| Total adjustments, net of tax | 524 | 390 | ||||
| Adjusted net loss | $ | (11,300 | ) | $ | (8,440 | ) |
| Diluted loss per share | $ | (0.54 | ) | $ | (0.68 | ) |
| Adjusted diluted loss per share | $ | (0.51 | ) | $ | (0.65 | ) |
| Diluted weighted average shares outstanding | 22,093 | 12,965 | ||||
| ^(1)^ | Asset impairment charges are related to store property and equipment. | |||||
| --- | --- | |||||
| ^(2)^ | Stock-based compensation expense includes amounts amortized to expense related to equity incentive plans. | |||||
| --- | --- | |||||
| ^(3)^ | Consulting and legal fees incurred relating to the Company’s transaction with Beyond that, due to their nature, did not qualify for capitalization as deferred debt or equity issuance costs. Given the magnitude and scope of these strategic transactions, the Company considers the incremental consulting and legal fees incurred not reflective of the ongoing costs to operate its business. | |||||
| --- | --- | |||||
| ^(4)^ | Severance charges include expenses related to severance agreements and permanent store closure compensation costs. | |||||
| --- | --- |
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ex_830277.htm
Exhibit 99.2
Kirkland’s, Inc. to Rebrand as The Brand House Collective, Inc. Accelerating Brand Conversions Utilizing Bed Bath & Beyond, Overstock, buybuy Baby
Announces Changes to the Board of Directors
NASHVILLE, Tenn. (June 17, 2025) — Kirkland’s, Inc. (Nasdaq: KIRK) (the “Company”) today announced plans to rebrand and change its corporate name from Kirkland’s Inc. to The Brand House Collective, Inc. (“The Brand House Collective”) reflecting the Company’s transformation into a multi-brand merchandising, supply chain and retail operator leading the brick & mortar vision and strategy for Kirkland’s Home along with Beyond, Inc.’s (“Beyond”) growing portfolio of iconic home and family brands, inclusive of Bed Bath & Beyond, Overstock, buybuy Baby.
Amy Sullivan, CEO of Kirkland’s, commented, “From the moment our partnership with Beyond began it was clear that our model needed to evolve. The Brand House Collective is more than a new name – it’s a bold declaration of where we’re headed, We’re aligning our identity with our vision to become a multi-brand merchandising, supply chain and retail operator – and backing it with decisive actions to strengthen our foundation: reducing excess inventory, closing underperforming locations, optimizing real estate assets, and enhancing talent across the organization. We are building a leaner, flatter and performance-led organization – driven by transformation, anchored in accountability, and powered by new ideas that we believe will deliver results.”
Ms. Sullivan continued, “This is a defining moment for our Company. As we transition into The Brand House Collective, we are building a team that reflects the future we’re creating - bold, customer obsessed and rooted in merchant excellence. As we move forward, we will continue to strengthen our bench with the talent needed to drive performance, profitability and long-term growth.”
Operational Reset to Drive Transformation
As part of our transformation into a multi-brand retail operator, we are executing an operational reset to streamline our footprint, strengthen core execution and build a stronger foundation for the future as The Brand House Collective. By consolidating real estate and leveraging underperforming store closures to reduce excess inventory, we believe we will drive faster inventory turn and maximize return on assets. Following the consolidation, we expect to move forward with approximately 290 of our current store locations as the foundational footprint for Kirkland’s Home, Bed Bath & Beyond Home, and Overstock. As we look ahead, we expect that improved discipline around inventory productivity, asset management and balance sheet health will serve as our north star at every level of the organization – shaping how we operate, make decisions and deliver long term value.
Accelerated Brand Conversion Strategy
Bed Bath & Beyond Home is a reintroduction of one of retail’s most iconic names – long known for great brands and trusted value. This fresh chapter centers around life’s moments in every room where families Gather, Entertain, Rest and Relax. We plan to accelerate the launch of Bed Bath & Beyond Home stores through full-market conversions of existing Kirkland’s Home stores. The first store is planned to open in Brentwood, TN in August 2025, with 5 more to follow in the market. The Greater Nashville area was selected as our launch market given our headquarters presence, allowing us to closely manage every detail and set the standard for future rollouts. Pending the results of the initial market we plan to convert approximately 75 stores through 2026. To support the brand transition, drive awareness and accelerate our overall growth, we will also co-brand the Kirkland’s Home website with Bed Bath & Beyond Home, creating a unified online experience as store conversions begin.
We also see tremendous opportunity to bring the Overstock brand to life in physical retail and have identified the first Nashville location with plans to expand to approximately 30 locations after the initial pilot. Additionally, we are finalizing store designs for buybuy Baby and other potential concepts as we build our multi-brand strategy. Our future real estate approach will align with the distinct identity of each brand and be positioned in neighborhoods where our customer prefers to shop. With a stronger foundation in place and a data-driven lens on market opportunity, we will evaluate all opportunities for growth including expanding company-owned locations and testing potential franchise opportunities.
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Corporate Reorganization to Drive Performance and Profitability
To support our transformation to The Brand House Collective, we executed a comprehensive corporate reorganization designed to drive performance, enhance accountability and align talent with brand specific growth priorities. As a customer-first, merchant-led organization, we implemented a streamlined structure with dedicated merchants leading each brand, supported by centralized teams across finance, operations and technology. All brand and functional leaders will report directly to Amy Sullivan, CEO and Chief Merchant & Creative Officer of The Brand House Collective. This unified reporting structure accelerates decision-making and ensures a single, unified vision as we advance our strategic transformation.
We have also recently bolstered our leadership team bringing in proven merchants, operators, brand builders, and customer experts to meet the needs of our transformation.
| ● | Jamie Schisler, Chief Operating Officer, responsible for overseeing Operations including Planning & Allocation, Marketing, E-Commerce and Technology. Mr. Schisler brings over two decades of specialty retail experience and has led strategic transformation and concept innovation at leading brands including Abercrombie & Fitch, Express and UpWest. |
|---|---|
| ● | Kerri Dlugokinski, VP General Merchandising Manager of Bed Bath & Beyond Home, will lead all aspects of merchandising for the brand. Ms. Dlugokinski has more than 20 years of experience at Target Corporation, where she held leadership roles across both fashion and home categories. |
| --- | --- |
| ● | Courtenay Adolf, VP of Supply Chain, with responsibility for Global Sourcing, Transportation and our Distribution Centers. Mr. Adolf brings decades of experience leading supply chain strategy and network optimizations that improve efficiency and reduce cost for companies including Target, CSS Industries and Eversana. |
| --- | --- |
Changes to the Board of Directors
On June 17, 2025, the Company’s Board of Directors (the “Board”) appointed Eric Schwartzman, Neely Tamminga, Tamara Ward and Steve Woodward (collectively, the “New Directors”) to the Board, effective June 24, 2025. Ms. Ward and Mr. Woodward were nominated by Beyond in accordance with the terms of the Amended and Restated Investor Rights Agreement, dated May 7, 2025. The New Directors bring extensive experience that supports our bold new vision as The Brand House Collective.
| ● | Eric Schwartzman brings decades of strategic finance and accounting experience across public and private omni-channel retail. He spent 17 years at legacy Bed Bath & Beyond leading high-impact financial and operational initiatives. His historical brand knowledge and transformation experience will support our financial performance and operational discipline. |
|---|---|
| ● | Neely Tamminga brings more than two decades of experience in consumer and economic research. Formerly a senior research analyst at Piper Jaffray & Co., Ms. Tamminga is the co-founder of Distill, a strategic advisory firm supporting CEOs and boards with data-driven insights into consumer behavior and macroeconomic trends. Her expertise turning data into actionable strategy will be instrumental in our brand and business growth. |
| --- | --- |
| ● | Tamara Ward is a seasoned operator, with significant leadership experience in marketing and operations leadership over her impressive career at Camping World Holdings. Her track record of driving growth and enhancing the customer experience will be an asset to the Board as we continue our strategic transformation. |
| --- | --- |
| ● | Steve “Woody”Woodward brings deep sector knowledge and a true merchant mindset. Mr. Woodward previously served as CEO of Kirkland’s Home and held senior roles at Crate & Barrel and Pier 1 Imports. His extensive experience in home retail and familiarity with our organization and ongoing mentorship of our management team position him to contribute meaningfully from day one. |
| --- | --- |
On June 17, Kirkland’s also announced the resignations of Ann Joyce, Charlie Pleas III, Chris Shimojima, Jill Soltau and Susan Lanigan. With the exception of Ms. Lanigan, whose resignation was effective on June 12, 2025, each of the foregoing resignations will be effective on June 24, 2025, at which time the Ms. Ward, Mr. Woodward, Ms. Tamminga and Mr. Schwartzman will join the Board. Ms. Sullivan will continue as a member of the Board.
Corporate Name Change
The Company plans to officially change its name to The Brand House Collective pending shareholder approval at the Company’s upcoming annual meeting on July 24, 2025. In conjunction with its corporate name change, The Brand House Collective will change the Company's ticker symbol from “KIRK” to “TBHC,” pending shareholder approval at the Company’s upcoming annual meeting on July 24, 2025. Once effective, the “KIRK” trading symbol will no longer be active. No action is needed from the Company's current shareholders relative to the ticker symbol change.
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About Kirkland’s, Inc.
Kirkland’s, Inc. is a specialty retailer of home décor and furnishings in the United States, currently operating 313 stores in 35 states as well as an e-commerce website, www.kirklands.com, under the Kirkland’s Home brand. The Company provides its customers an engaging shopping experience characterized by a curated, affordable selection of home décor and furnishings along with inspirational design ideas. This combination of quality and stylish merchandise, value pricing and a stimulating in-store and online environment provides the Company’s customers with a unique brand experience. More information can be found at www.kirklands.com.
Forward-Looking Statements
Except for historical information contained herein, certain statements in this release, constitute forward-looking statements that are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are subject to the finalization of the Company’s quarterly financial and accounting procedures. Forward-looking statements deal with potential future circumstances and developments and are, accordingly, forward-looking in nature. You are cautioned that such forward-looking statements, which may be identified by words such as "anticipate," "believe," "expect," "estimate," "intend," "plan," "seek," "may," "could," "strategy," and similar expressions, involve known and unknown risks and uncertainties, many of which are outside of the Company’s control, which may cause the Company's actual results to differ materially from forecasted results. Those risks and uncertainties include, among other things, risks associated with the effect of the transactions entered into with Beyond (the “Transactions”) on the Company’s business relationships; operating results and business generally; unexpected costs, charges or expenses resulting from the Transactions; potential litigation relating to the Transactions that could be instituted against Beyond, the Company or their affiliates’ respective directors, managers or officers, including the effects of any outcomes related thereto; continued availability of capital and financing; the ability to obtain the various synergies envisioned between the Company and Beyond; the ability of the Company to successfully open new stores or rebrand existing Kirkland’s Home stores under a Bed Bath & Beyond Home or other licensed brand; the ability of the Company to successfully market its products to new customers and expand through new e-commerce platforms and to implement its plans, forecasts and other expectations with respect to its business after the completion of the Transactions and realize additional opportunities for growth and innovation; risks associated with the Company's liquidity including cash flows from operations and the amount of borrowings under the secured revolving credit facility; the fact that our independent registered public accounting firm’s report for the year ended February 1, 2025 is qualified as to our ability to continue as a going concern; the Company’s ability to successfully implement cost savings and other strategic initiatives intended to improve operating results and liquidity positions, the Company’s actual and anticipated progress towards its short-term and long-term objectives including its multi-brand and omni-channel strategy, the risk that natural disasters, pandemic outbreaks, global political events, war and terrorism could impact the Company’s revenues, inventory and supply chain; the continuing consumer impact of inflation and countermeasures, including high interest rates, the effectiveness of the Company’s marketing campaigns, risks related to changes in U.S. policy related to imported merchandise, particularly with regard to the impact of tariffs on goods imported from China and strategies undertaken to mitigate such impact, the Company’s ability to retain its senior management team; volatility in the price of the Company’s common stock, the competitive environment in the home décor industry in general and in the Company's specific market areas, inflation, fluctuations in cost and availability of inventory, increased transportation costs and potential interruptions in supply chain, distribution systems and delivery network, including the Company’s e-commerce systems and channels, the ability to control employment and other operating costs, availability of suitable retail locations and other growth opportunities, disruptions in information technology systems including the potential for security breaches of the Company's information or its customers’ information, seasonal fluctuations in consumer spending, and economic conditions in general. Those and other risks are more fully described in the Company's filings with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K filed on May 2, 2025 and subsequent reports. Forward-looking statements included in this release are made as of the date of this release. Any changes in assumptions or factors on which such statements are based could produce materially different results. Except as required by law, the Company disclaims any obligation to update any such factors or to publicly announce results of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.
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