Tile Shop Holdings, Inc. (NASDAQ: TTS) issued a weak forecast for the third quarter. The company expects Q3 sales to rise 7% to $84 million. Comparable store sales are projected to increase 1% in the quarter.
The Minneapolis-based company, a specialty retailer of manufactured and natural stone tiles, setting and maintenance materials, and related accessories, also announced preliminary results for its third quarter ended September 30, 2017.
Net sales is expected to grow approximately 7% to approximately $84 million for the third quarter ended compared with $78.6 million for the third quarter ended September 30, 2016. Comparable store sales growth for the third quarter is expected to approximate 1%. Comparable store sales growth for the third quarter of 2016 was 5.7%.
Gross margin for the third quarter of 2017 is expected to be approximately 66 to 67%, compared with 70.2% for the third quarter of 2016. Selling, general and administrative costs for the third quarter of 2017 are expected to be approximately $52 million compared with $47.4 million for the third quarter of 2016.
“A more competitive environment led to weaker than expected results in our third quarter,” said CEO Chris Homeister.
“Additionally, we are seeing increased demand for opening price point offerings, and are in the process of introducing new products to our assortment as a result.”
Tile Shop shares plummeted by noon ET on Tuesday by $4.76, or 36.1%, to a new 52-week low of $8.44, compared to a 52-week high of $22.40.
