Kirkland's (KIRK) 10-Q 2 Dec 22 2023 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Oct. 29, 2022	Nov. 25, 2022
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Oct. 29, 2022
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Entity Registrant Name	Kirkland’s, Inc.
Entity Central Index Key	0001056285
Current Fiscal Year End Date	--01-28
Entity Filer Category	Accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		12,754,368
Entity Interactive Data Current	Yes
Entity Current Reporting Status	Yes
Entity File Number	000-49885
Entity Tax Identification Number	62-1287151
Entity Address, Address Line One	5310 Maryland Way
Entity Address, City or Town	Brentwood
Entity Address, State or Province	TN
Entity Address, Postal Zip Code	37027
Entity Incorporation, State or Country Code	TN
City Area Code	615
Local Phone Number	872-4800
Title of 12(b) Security	Common Stock
Trading Symbol	KIRK
Security Exchange Name	NASDAQ
Document Quarterly Report	true
Document Transition Report	false

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands	Oct. 29, 2022	Jan. 29, 2022	Oct. 30, 2021
Current assets:
Cash and cash equivalents	$ 11,245	$ 25,003	$ 26,475
Inventories, net	126,315	114,029	115,671
Prepaid expenses and other current assets	7,126	10,537	10,170
Total current assets	144,686	149,569	152,316
Property and equipment:
Equipment	19,929	20,043	20,261
Furniture and fixtures	68,580	69,823	71,502
Leasehold improvements	106,524	106,065	108,200
Computer software and hardware	80,142	77,311	80,981
Projects in progress	2,594	3,366	3,514
Property and equipment, gross	277,769	276,608	284,458
Accumulated depreciation	(235,140)	(226,611)	(231,608)
Property and equipment, net	42,629	49,997	52,850
Operating lease right-of-use assets	136,280	124,684	128,169
Other assets	7,979	6,939	6,548
Total assets	331,574	331,189	339,883
Current liabilities:
Accounts payable	47,157	62,535	68,349
Accrued expenses	27,027	30,811	28,593
Operating lease liabilities	40,156	41,268	41,763
Total current liabilities	114,340	134,614	138,705
Operating lease liabilities	119,254	111,021	120,095
Revolving line of credit	60,000	0	0
Other liabilities	4,915	4,428	5,320
Total liabilities	298,509	250,063	264,120
Shareholders’ equity:
Preferred stock, no par value, 10,000,000 shares authorized; no shares issued or outstanding at October 29, 2022, January 29, 2022, and October 30, 2021, respectively	0	0	0
Common stock, no par value; 100,000,000 shares authorized; 12,754,368; 12,631,347; and 13,007,409 shares issued and outstanding at October 29, 2022, January 29, 2022, and October 30, 2021, respectively	174,949	175,856	175,479
Accumulated deficit	(141,884)	(94,730)	(99,716)
Total shareholders’ equity	33,065	81,126	75,763
Total liabilities and shareholders’ equity	$ 331,574	$ 331,189	$ 339,883

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares	Oct. 29, 2022	Jan. 29, 2022	Oct. 30, 2021
Statement Of Financial Position [Abstract]
Preferred stock, par value	$ 0	$ 0	$ 0
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000	10,000,000
Preferred stock, shares issued (in shares)	0	0	0
Preferred stock, shares outstanding (in shares)	0	0	0
Common stock, par value	$ 0	$ 0	$ 0
Common stock, shares authorized (in shares)	100,000,000	100,000,000	100,000,000
Common stock, shares issued (in shares)	12,754,368	12,631,347	13,007,409
Common stock, shares outstanding (in shares)	12,754,368	12,631,347	13,007,409

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) shares in Thousands	3 Months Ended		9 Months Ended
	Oct. 29, 2022	Oct. 30, 2021	Oct. 29, 2022	Oct. 30, 2021
Income Statement [Abstract]
Net sales	$ 130,962,000	$ 143,630,000	$ 336,348,000	$ 381,989,000
Cost of sales	98,275,000	93,817,000	256,844,000	252,223,000
Gross profit	32,687,000	49,813,000	79,504,000	129,766,000
Operating expenses:
Compensation and benefits	20,794,000	19,549,000	63,193,000	60,326,000
Other operating expenses	16,976,000	19,589,000	50,996,000	53,245,000
Depreciation (exclusive of depreciation included in cost of sales)	1,577,000	1,655,000	4,870,000	4,898,000
Total operating expenses	39,347,000	40,793,000	119,059,000	118,469,000
Operating (loss) income	(6,660,000)	9,020,000	(39,555,000)	11,297,000
Interest expense	704,000	79,000	1,226,000	240,000
Other income	(80,000)	(88,000)	(235,000)	(243,000)
(Loss) income before income taxes	(7,284,000)	9,029,000	(40,546,000)	11,300,000
Income tax expense	57,000	1,800,000	355,000	1,726,000
Net (loss) income	$ (7,341,000)	$ 7,229,000	$ (40,901,000)	$ 9,574,000
(Loss) earnings per share:
Basic	$ (0.58)	$ 0.54	$ (3.22)	$ 0.69
Diluted	$ (0.58)	$ 0.51	$ (3.22)	$ 0.64
Weighted average shares outstanding:
Basic	12,754	13,405	12,686	13,955
Diluted	12,754	14,268	12,686	14,953

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Thousands	Total	Common Stock	Accumulated Deficit
Balance, beginning of period at Jan. 30, 2021	$ 94,922	$ 174,391	$ (79,469)
Balance, beginning of period (in shares) at Jan. 30, 2021		14,292,250
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options	52	$ 52
Exercise of stock options (in shares)		10,669
Restricted stock issued		30,087
Net share settlement of stock options and restricted stock units	(257)	$ (257)
Net share settlement of stock options and restricted stock units (in shares)		(11,339)
Stock-based compensation expense	232	$ 232
Repurchase and retirement of common stock	(1,356)		(1,356)
Repurchase and retirement of common stock (in shares)		(47,350)
Net Income Loss	1,719		1,719
Balance, end of period at May. 01, 2021	95,312	$ 174,418	(79,106)
Balance, end of period (in shares) at May. 01, 2021		14,274,317
Balance, beginning of period at Jan. 30, 2021	94,922	$ 174,391	(79,469)
Balance, beginning of period (in shares) at Jan. 30, 2021		14,292,250
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options	$ 146
Repurchase and retirement of common stock (in shares)	(1,414,642)
Net Income Loss	$ 9,574
Balance, end of period at Oct. 30, 2021	$ 75,763	$ 175,479	(99,716)
Balance, end of period (in shares) at Oct. 30, 2021	13,007,409	13,007,409
Balance, beginning of period at May. 01, 2021	$ 95,312	$ 174,418	(79,106)
Balance, beginning of period (in shares) at May. 01, 2021		14,274,317
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options	94	$ 94
Exercise of stock options (in shares)		20,168
Restricted stock issued		79,775
Net share settlement of stock options and restricted stock units	(73)	$ (73)
Net share settlement of stock options and restricted stock units (in shares)		7,582
Stock-based compensation expense	651	$ 651
Repurchase and retirement of common stock	(12,008)		(12,008)
Repurchase and retirement of common stock (in shares)		(561,548)
Net Income Loss	626		626
Balance, end of period at Jul. 31, 2021	84,602	$ 175,090	(90,488)
Balance, end of period (in shares) at Jul. 31, 2021		13,805,130
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Restricted stock issued		10,606
Net share settlement of stock options and restricted stock units	(49)	$ (49)
Net share settlement of stock options and restricted stock units (in shares)		(2,583)
Stock-based compensation expense	438	$ 438
Repurchase and retirement of common stock	$ (16,457)		(16,457)
Repurchase and retirement of common stock (in shares)	(805,744)	(805,744)
Net Income Loss	$ 7,229		7,229
Balance, end of period at Oct. 30, 2021	$ 75,763	$ 175,479	(99,716)
Balance, end of period (in shares) at Oct. 30, 2021	13,007,409	13,007,409
Balance, beginning of period at Jan. 29, 2022	$ 81,126	$ 175,856	(94,730)
Balance, beginning of period (in shares) at Jan. 29, 2022	12,631,347	12,631,347
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options	$ 16	$ 16
Exercise of stock options (in shares)		2,705
Restricted stock issued		797,849
Net share settlement of stock options and restricted stock units	(2,375)	$ (2,375)
Net share settlement of stock options and restricted stock units (in shares)		(224,320)
Stock-based compensation expense	548	$ 548
Repurchase and retirement of common stock	(6,253)		(6,253)
Repurchase and retirement of common stock (in shares)		(479,966)
Net Income Loss	(7,855)		(7,855)
Balance, end of period at Apr. 30, 2022	65,207	$ 174,045	(108,838)
Balance, end of period (in shares) at Apr. 30, 2022		12,727,615
Balance, beginning of period at Jan. 29, 2022	$ 81,126	$ 175,856	(94,730)
Balance, beginning of period (in shares) at Jan. 29, 2022	12,631,347	12,631,347
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options	$ 16
Repurchase and retirement of common stock (in shares)	(479,966)
Net Income Loss	$ (40,901)
Balance, end of period at Oct. 29, 2022	$ 33,065	$ 174,949	(141,884)
Balance, end of period (in shares) at Oct. 29, 2022	12,754,368	12,754,368
Balance, beginning of period at Apr. 30, 2022	$ 65,207	$ 174,045	(108,838)
Balance, beginning of period (in shares) at Apr. 30, 2022		12,727,615
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Restricted stock issued		28,574
Net share settlement of stock options and restricted stock units	(8)	$ (8)
Net share settlement of stock options and restricted stock units (in shares)		(1,821)
Stock-based compensation expense	617	$ 617
Net Income Loss	(25,705)		(25,705)
Balance, end of period at Jul. 30, 2022	40,111	$ 174,654	(134,543)
Balance, end of period (in shares) at Jul. 30, 2022		12,754,368
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation expense	$ 295	$ 295
Repurchase and retirement of common stock (in shares)	0
Net Income Loss	$ (7,341)		(7,341)
Balance, end of period at Oct. 29, 2022	$ 33,065	$ 174,949	$ (141,884)
Balance, end of period (in shares) at Oct. 29, 2022	12,754,368	12,754,368

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($)	9 Months Ended
	Oct. 29, 2022	Oct. 30, 2021
Cash flows from operating activities:
Net (loss) income	$ (40,901,000)	$ 9,574,000
Adjustments to reconcile net (loss) income to net cash used in operating activities:
Depreciation and amortization of property and equipment	12,925,000	15,535,000
Amortization of debt issue costs	69,000	69,000
Asset impairment	447,000	754,000
Loss on disposal of property and equipment	195,000	(23,000)
Stock-based compensation expense	1,460,000	1,321,000
Changes in assets and liabilities:
Inventories, net	(12,286,000)	(53,588,000)
Prepaid expenses and other current assets	3,184,000	(1,531,000)
Accounts payable	(14,648,000)	12,588,000
Accrued expenses	(1,873,000)	(8,373,000)
Income taxes receivable	(1,684,000)	(849,000)
Operating lease assets and liabilities	(4,670,000)	(12,876,000)
Other assets and liabilities	(427,000)	(1,291,000)
Net cash used in operating activities	(58,209,000)	(38,690,000)
Cash flows from investing activities:
Proceeds from sale of property and equipment	35,000	44,000
Capital expenditures	(6,964,000)	(5,162,000)
Net cash used in investing activities	(6,929,000)	(5,118,000)
Cash flows from financing activities:
Borrowings on revolving line of credit	60,000,000	0
Cash used in net share settlement of stock options and restricted stock units	(2,383,000)	(379,000)
Proceeds received from employee stock option exercises	16,000	146,000
Repurchase and retirement of common stock	(6,253,000)	(29,821,000)
Net cash provided by (used in) financing activities	51,380,000	(30,054,000)
Cash and cash equivalents:
Net decrease	(13,758,000)	(73,862,000)
Beginning of the period	25,003,000	100,337,000
End of the period	11,245,000	26,475,000
Supplemental schedule of non-cash activities:
Non-cash accruals for purchases of property and equipment	$ 573,000	$ 984,000

Description of Business and Bas

Description of Business and Basis of Presentation	9 Months Ended
	Oct. 29, 2022
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Description of Business and Basis of Presentation	Note 1 – Description of Business and Basis of Presentation Nature of Business — Kirkland’s, Inc. (the “Company”, “we”, “our”, or “us”) is a specialty retailer of home décor in the United States operating 356 stores in 35 states as of October 29, 2022 , as well as an e-commerce website, www.kirklands.com, under the Kirkland’s Home brand. Principles of consolidation — The condensed consolidated financial statements of the Company include the accounts of Kirkland’s, Inc. and its wholly-owned subsidiaries, Kirkland’s Stores, Inc., Kirkland’s DC, Inc., and Kirkland’s Texas, LLC. Significant intercompany accounts and transactions have been eliminated. Basis of presentation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and are presented in accordance with the requirements of Form 10-Q and pursuant to the reporting and disclosure rules and regulations of the United States Securities and Exchange Commission (“SEC”). In the opinion of management, all adjustments, including normal recurring accruals, considered necessary for a fair presentation have been included. These financial statements should be read in conjunction with the audited financial statements included in the Company’s Annual Report on Form 10-K filed with the SEC on March 25, 2022. Macroeconomic conditions — Economic disruption, inflation, uncertainty, volatility and the COVID-19 pandemic have affected the Company’s business operations. As a result, if these conditions persist and/or worsen, the Company’s accounting estimates and assumptions could be impacted in subsequent periods, and it is reasonably possible such changes could be significant. Seasonality — The results of the Company’s operations for the 13-week and 39-week periods ended October 29, 2022 are not indicative of the results to be expected for any other interim period or for the entire fiscal year due to seasonality factors. Fiscal year — The Company’s fiscal year ends on the Saturday closest to January 31, resulting in years of either 52 or 53 weeks. Accordingly, fiscal 2022 represents the 52 weeks ending on January 28, 2023 and fiscal 2021 represents the 52 weeks ended on January 29, 2022. Use of estimates — The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from the estimates and assumptions used. It should be understood that accounting measurements at interim dates inherently involve greater reliance on estimates than those at fiscal year-end. Changes in estimates are recognized in the period when new information becomes available to management. Areas where the nature of the estimate makes it reasonably possible that actual results could materially differ from amounts estimated include, but are not limited to, impairment assessments on long-lived assets, inventory reserves, self-insurance reserves and deferred tax asset valuation allowances.

Revenue Recognition

Revenue Recognition	9 Months Ended
	Oct. 29, 2022
Revenue From Contract With Customer [Abstract]
Revenue Recognition	Note 2 – Revenue Recognition Net sales — Net sales includes the sale of merchandise, net of returns, shipping revenue, gift card breakage revenue and revenue earned from our private label credit card program and excludes sales taxes. Sales returns reserve — The Company reduces net sales and estimates a liability for sales returns based on historical return trends, and the Company believes that its estimate for sales returns is a reasonably accurate reflection of future returns associated with past sales. However, as with any estimate, refund activity may vary from estimated amounts. The Company had a liability of approximately $ 1.6 million, $ 1.4 million and $ 1.5 million reserved for sales returns at October 29, 2022, January 29, 2022 and October 30, 2021 , respectively, included in accrued expenses on the condensed consolidated balance sheets. The related sales return reserve products recovery asset included in prepaid expenses and other current assets on the condensed consolidated balance sheets was approximately $ 745,000 , $ 697,000 and $ 659,000 at October 29, 2022, January 29, 2022, and October 30, 2021, respectively. Deferred e-commerce revenue —The Company recognizes revenue at the time of sale of merchandise to customers in its stores. E-commerce revenue is recorded at the estimated time of delivery to the customer. If the Company receives payment before completion of its customer obligations, the revenue is deferred until the customer takes possession of the merchandise and the sale is complete. Deferred revenue related to e-commerce orders that have been shipped but not estimated to be received by customers included in accrued expenses on the condensed consolidated balance sheets was approximately $ 1.2 million, $ 1.0 million and $ 1.1 million at October 29, 2022, January 29, 2022 and October 30, 2021 , respectively. The related contract assets, reflected in inventory on the condensed consolidated balance sheets, totaled approximately $ 616,000 , $ 518,000 and $ 545,000 at October 29, 2022, January 29, 2022 and October 30, 2021, respectively. Gift cards — Gift card sales are recognized as revenue when tendered for payment. While the Company honors all gift cards presented for payment, the Company determines the likelihood of redemption to be remote for certain gift card balances due to long periods of inactivity. The Company uses the redemption recognition method to account for breakage for unused gift card amounts where breakage is recognized as gift cards are redeemed for the purchase of goods based upon a historical breakage rate. In these circumstances, to the extent the Company determines there is no requirement for remitting unredeemed card balances to government agencies under unclaimed property laws, such amounts are recognized in the condensed consolidated statements of operations as a component of net sales. The table below sets forth selected gift card liability information (in thousands) for the periods indicated: October 29, 2022 January 29, 2022 October 30, 2021 Gift card liability, net of estimated breakage (included in accrued expenses) $ 13,658 $ 14,761 $ 13,201 The table below sets forth selected gift card breakage and redemption information (in thousands) for the periods indicated: 13-Week Period Ended 39-Week Period Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Gift card breakage revenue (included in net sales) $ 189 $ 200 $ 582 $ 611 Gift card redemptions recognized in the current period related to amounts included in the gift card contract liability balance as of the prior period 1,673 1,764 4,200 4,303 Customer loyalty program — The Company has a loyalty program called the K-club that allows members to receive points based on qualifying purchases that are converted into certificates that may be redeemed on future purchases. This customer option is a material right and, accordingly, represents a separate performance obligation to the customer under ASC 606 Revenue from Contracts with Customers. The related loyalty program deferred revenue included in accrued expenses on the condensed consolidated balance sheets was approximately $ 1.2 million, $ 1.3 million and $ 1.1 million at October 29, 2022, January 29, 2022 and October 30, 2021, respectively.

Income Taxes

Income Taxes	9 Months Ended
	Oct. 29, 2022
Income Tax Disclosure [Abstract]
Income Taxes	Note 3 – Income Taxes For the 13-week periods ended October 29, 2022 and October 30, 2021, the Company recorded income tax expense of approximately $ 57,000 , or 0.8 % of the loss before income taxes, and $ 1.8 million, or 19.9 % of income before income taxes, respectively. The change in income taxes for the 13-week period ended October 29, 2022, compared to the prior year period, was primarily due to the federal net operating loss carry-forward now projected by the Company for fiscal 2022, which is fully offset by a valuation allowance. For the 39-week periods ended October 29, 2022 and October 30, 2021, the Company recorded income tax expense of $ 355,000 , or 0.9 % of the loss before income taxes, and $ 1.7 million, or 15.3 % of income before income taxes, respectively. Income taxes for the 39-week period ended October 29, 2022 were minimal due to valuation allowances against deferred tax assets. Income tax expense differs from the amount computed by applying the statutory federal income tax rate to (loss) income before income taxes. A reconciliation of income tax expense at the statutory federal income tax rate to the amount provided is as follows (in thousands): 13-Week Period Ended 39-Week Period Ended October 29, October 30, October 29, October 30, 2022 2021 2022 2021 Tax at federal statutory rate $ ( 1,530 ) $ 1,896 $ ( 8,515 ) $ 2,373 State income taxes, net of federal benefit ( 223 ) 300 ( 689 ) 366 Tax credits 17 ( 29 ) ( 109 ) ( 35 ) Executive compensation ( 15 ) 65 101 80 Stock based compensation programs ( 43 ) ( 50 ) ( 596 ) ( 567 ) Valuation allowance 1,843 ( 409 ) 10,150 ( 519 ) Other 8 27 13 28 Income tax expense $ 57 $ 1,800 $ 355 $ 1,726 The Company recognizes deferred tax assets and liabilities using estimated future tax rates for the effect of temporary differences between the book and tax basis of recorded assets and liabilities, including net operating loss carry forwards. Management assesses the realizability of deferred tax assets and records a valuation allowance if it is more likely than not that all or a portion of the deferred tax assets will not be realized. The Company considers the probability of future taxable income and our historical profitability, among other factors, in assessing the amount of the valuation allowance. Adjustments could be required in the future if the Company estimates that the amount of deferred tax assets to be realized is more than the net amount recorded. Any change in the valuation allowance could have the effect of increasing or decreasing the income tax provision in the statement of operations based on the nature of the deferred tax asset deemed realizable in the period in which such determination is made. As of October 29, 2022 and October 30, 2021, the Company recorded a full valuation allowance against deferred tax assets.

(Loss) Earnings Per Share

(Loss) Earnings Per Share	9 Months Ended
	Oct. 29, 2022
Earnings Per Share [Abstract]
(Loss) Earnings Per Share	Note 4 – (Loss) Earnings Per Share Basic (loss) earnings per share is computed by dividing net (loss) income by the weighted average number of shares outstanding during each period presented. Diluted (loss) earnings per share is computed by dividing net (loss) income by the weighted average number of shares outstanding plus the dilutive effect of stock equivalents outstanding during the applicable periods using the treasury stock method. Diluted (loss) earnings per share reflects the potential dilution that could occur if options to purchase stock were exercised into common stock and if outstanding grants of restricted stock were vested. Stock options and restricted stock units that were not included in the computation of diluted (loss) earnings per share, because to do so would have been antidilutive, were approximately 531,000 shares and 168,000 shares for the 13-week periods ended October 29, 2022 and October 30, 2021, respectively, and 597,000 shares and 145,000 shares for the 39-week periods ended October 29, 2022 and October 30, 2021, respectively.

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Oct. 29, 2022
Fair Value Disclosures [Abstract]
Fair Value Measurements	Note 5 – Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants on the measurement date. The Company uses a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. The carrying amounts of cash and cash equivalents, accounts receivable, other current assets and accounts payable approximate fair value because of their short maturities. The Company measures certain assets at fair value on a non-recurring basis, including the evaluation of long-lived assets for impairment using Company-specific assumptions, including forecasts of projected financial information that would fall within Level 3 of the fair value hierarchy. The Company uses market participant rents (Level 2 input) to calculate the fair value of right-of-use assets and discounted future cash flows of the asset or asset group using a discount rate that approximates the cost of capital of a market participant (Level 2 input) to quantify fair value for other long-lived assets.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Oct. 29, 2022
Commitments And Contingencies Disclosure [Abstract]
Commitments and Contingencies	Note 6 – Commitments and Contingencies The Company was named as a defendant in a putative class action filed in April 2017 in the United States District Court for the Western District of Pennsylvania, Gennock v. Kirkland’s, Inc. The complaint alleged that the Company, in violation of federal law, published more than the last five digits of a credit or debit card number on customers’ receipts and sought statutory and punitive damages and attorneys’ fees and costs. On October 21, 2019, the District Court dismissed the matter and ruled that the Plaintiffs did not have standing based on the Third Circuit’s recent decision in Kamal v. J. Crew Group, Inc., 918 F.3d 102 (3d. Cir. 2019). Following the dismissal in federal court, on October 25, 2019, the plaintiffs filed a Praecipe to Transfer the case to Pennsylvania state court, and on August 20, 2020, the court ruled that the plaintiffs have standing. The Company appealed that ruling, and on April 27, 2022, the Superior Court of Pennsylvania granted the Company’s petition for permission to appeal. On November 10, 2022, the Company filed its Reply Brief with the Superior Court of Pennsylvania. The Company continues to believe that the case is without merit and intends to continue to vigorously defend itself against the allegations. The matter is covered by insurance, and the Company does not believe that the case will have a material adverse effect on its consolidated financial condition, operating results or cash flows. The Company was named as a defendant in a putative class action filed in May 2018 in the Superior Court of California, Miles v. Kirkland’s Stores, Inc. The case has been removed to United States District Court for the Central District of California. The complaint alleges, on behalf of Miles and all other hourly Kirkland’s employees in California, various wage and hour violations and seeks unpaid wages, statutory and civil penalties, monetary damages and injunctive relief. Kirkland’s denies the material allegations in the complaint and believes that its employment policies are generally compliant with California law. On March 22, 2022, the District Court denied the plaintiff’s motion to certify in its entirety, and on May 26, 2022, the Ninth Circuit granted the plaintiff’s petition for permission to appeal. The Court has stayed the entire case pending the appeal. The Company continues to believe the case is without merit and intends to vigorously defend itself against the allegations. The Company was named as a defendant in a putative class action filed on August 23, 2022 in the United States District Court for the Southern District of New York, Sicard v. Kirkland’s Stores, Inc. The complaint alleges, on behalf of Sicard and all other hourly store employees based in New York, that Kirkland’s violated New York Labor Law Section 191 by failing to pay him and the putative class members their wages within seven calendar days after the end of the week in which those wages were earned, rather paying wages on a bi-weekly basis. The Company believes the case is without merit and plans to file a motion to dismiss. The Company is also party to other pending legal proceedings and claims that arise in the normal course of business. Although the outcome of such proceedings and claims cannot be determined with certainty, the Company’s management is of the opinion that it is unlikely that such proceedings and any claims in excess of insurance coverage will have a material effect on its consolidated financial condition, operating results or cash flows

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
	Oct. 29, 2022
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Stock-Based Compensation	Note 7 – Stock-Based Compensation The Company maintains equity incentive plans under which it may grant non-qualified stock options, incentive stock options, restricted stock, restricted stock units, or stock appreciation rights to employees, non-employee directors and consultants. Compensation expense is recognized on a straight-line basis over the vesting periods of each grant. There have been no material changes in the assumptions used to compute compensation expense during the current year. The table below sets forth selected stock-based compensation information (in thousands, except share amounts) for the periods indicated: 13-Week Period Ended 39-Week Period Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Stock-based compensation expense (included in compensation and benefits on the condensed consolidated statements of operations) $ 295 $ 438 $ 1,460 $ 1,321 Restricted stock units granted 50,000 — 409,800 152,815 Stock options granted 40,000 — 40,000 — During the 13-week and 39-week periods ended October 29, 2022 and October 30, 2021, the Company also granted performance-based restricted stock units (“PSUs”) that are subject to the achievement of specified performance goals over a specified performance period. The performance metrics for the PSUs are earnings before interest, taxes, depreciation and amortization (“EBITDA”) compared to target EBITDA and also include a relative shareholder return modifier. The Company currently estimates that no shares will be issued with respect to the PSUs granted in fiscal 2021 or 2022.

Share Repurchase Plan

Share Repurchase Plan	9 Months Ended
	Oct. 29, 2022
Treasury Stock Transactions [Abstract]
Share Repurchase Plan	Note 8 – Share Repurchase Plan On December 3, 2020, September 2, 2021, and January 6, 2022, the Company announced that its Board of Directors authorized a share repurchase plan providing for the purchase in the aggregate of up to $ 20 million, $ 20 million and $ 30 million, respectively, of the Company’s outstanding common stock. Repurchases of shares are made in accordance with applicable securities laws and may be made from time to time in the open market or by negotiated transactions. The amount and timing of repurchases are based on a variety of factors, including stock price, regulatory limitations and other market and economic factors. The share repurchase plan does not require the Company to repurchase any specific number of shares, and the Company may terminate the repurchase plan at any time. As of October 29, 2022 , the Company had approximately $ 26.3 million remaining under the current share repurchase plan. The table below sets forth selected share repurchase plan information (in thousands, except share amounts) for the periods indicated: 13-Week Period Ended 39-Week Period Ended October 29, October 30, October 29, October 30, 2022 2021 2022 2021 Shares repurchased and retired — 805,744 479,966 1,414,642 Share repurchase cost $ — $ 16,457 $ 6,253 $ 29,821

Senior Credit Facility

Senior Credit Facility	9 Months Ended
	Oct. 29, 2022
Debt Disclosure [Abstract]
Senior Credit Facility	Note 9 – Senior Credit Facility On December 6, 2019, the Company entered into a Second Amended and Restated Credit Agreement (the “Credit Agreement”) with Bank of America, N.A. as administrative agent, collateral agent and lender. The Credit Agreement contains a $ 75 million senior secured revolving credit facility, a swingline availability of $ 10 million, a $ 25 million incremental accordion feature and a maturity date of December 2024. Advances under the Credit Agreement bear interest at an annual rate equal to the London Interbank Offered Rate (“LIBOR”) plus a margin ranging from 125 to 175 basis points with no LIBOR floor, and the fee paid to the lender on the unused portion of the credit facility is 25 basis points per annum. Borrowings under the Credit Agreement are subject to certain conditions, and the Credit Agreement contains customary events of default, including, without limitation, failure to make payments, a cross-default to certain other debt, breaches of covenants, breaches of representations and warranties, a change in control, certain monetary judgments and bankruptcy and certain events under the Employee Retirement Income Security Act of 1974 (“ERISA”). Upon any such event of default, the principal amount of any unpaid loans and all other obligations under the Credit Agreement may be declared immediately due and payable. The maximum availability under the Credit Agreement is limited by a borrowing base formula, which consists of a percentage of eligible inventory and eligible credit card receivables, less reserves. The Company is subject to a Second Amended and Restated Security Agreement (the “Security Agreement”) with its lender. Pursuant to the Security Agreement, the Company pledged and granted to the administrative agent, for the benefit of itself and the secured parties specified therein, a lien on and security interest in all of the rights, title and interest in substantially all of the Company’s assets to secure the payment and performance of the obligations under the Credit Agreement. As of October 29, 2022 , the Company was in compliance with the covenants in the Credit Agreement. Under the Credit Agreement, there were $ 60.0 million in outstanding borrowings and no letters of credit outstanding with approximately $ 15.0 million available for borrowing as of October 29, 2022 .

New Accounting Pronouncements

New Accounting Pronouncements	9 Months Ended
	Oct. 29, 2022
New Accounting Pronouncements And Changes In Accounting Principles [Abstract]
New Accounting Pronouncements	N ote 10 – New Accounting Pronouncements New Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” This guidance is in response to accounting concerns regarding contract modifications and hedge accounting because of impending rate reform associated with structural risks of interbank offered rates, and, particularly, the risk of cessation of the LIBOR related to regulators in several jurisdictions around the world having undertaken reference rate reform initiatives to identify alternative reference rates. The guidance provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The adoption of this guidance is effective for all entities as of March 12, 2020 through December 31, 2022. The Company does not expect the adoption of this guidance to have a material impact on its condensed consolidated financial statements and related disclosures.

Subsequent Event

Subsequent Event	9 Months Ended
	Oct. 29, 2022
Subsequent Events [Abstract]
Subsequent Event	N ote 11 – Subsequent Event Subsequent to October 29, 2022, the Company repaid $ 30.0 million of outstanding borrowings on the Credit Agreement.

Description of Business and B_2

Description of Business and Basis of Presentation (Policies)	9 Months Ended
	Oct. 29, 2022
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Nature of Business	Nature of Business — Kirkland’s, Inc. (the “Company”, “we”, “our”, or “us”) is a specialty retailer of home décor in the United States operating 356 stores in 35 states as of October 29, 2022 , as well as an e-commerce website, www.kirklands.com, under the Kirkland’s Home brand.
Principles of consolidation	Principles of consolidation — The condensed consolidated financial statements of the Company include the accounts of Kirkland’s, Inc. and its wholly-owned subsidiaries, Kirkland’s Stores, Inc., Kirkland’s DC, Inc., and Kirkland’s Texas, LLC. Significant intercompany accounts and transactions have been eliminated.
Basis of presentation	Basis of presentation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and are presented in accordance with the requirements of Form 10-Q and pursuant to the reporting and disclosure rules and regulations of the United States Securities and Exchange Commission (“SEC”). In the opinion of management, all adjustments, including normal recurring accruals, considered necessary for a fair presentation have been included. These financial statements should be read in conjunction with the audited financial statements included in the Company’s Annual Report on Form 10-K filed with the SEC on March 25, 2022.
Macroeconomic conditions	Macroeconomic conditions — Economic disruption, inflation, uncertainty, volatility and the COVID-19 pandemic have affected the Company’s business operations. As a result, if these conditions persist and/or worsen, the Company’s accounting estimates and assumptions could be impacted in subsequent periods, and it is reasonably possible such changes could be significant.
Fiscal year	Seasonality — The results of the Company’s operations for the 13-week and 39-week periods ended October 29, 2022 are not indicative of the results to be expected for any other interim period or for the entire fiscal year due to seasonality factors. Fiscal year — The Company’s fiscal year ends on the Saturday closest to January 31, resulting in years of either 52 or 53 weeks. Accordingly, fiscal 2022 represents the 52 weeks ending on January 28, 2023 and fiscal 2021 represents the 52 weeks ended on January 29, 2022.
Use of estimates	Use of estimates — The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from the estimates and assumptions used. It should be understood that accounting measurements at interim dates inherently involve greater reliance on estimates than those at fiscal year-end. Changes in estimates are recognized in the period when new information becomes available to management. Areas where the nature of the estimate makes it reasonably possible that actual results could materially differ from amounts estimated include, but are not limited to, impairment assessments on long-lived assets, inventory reserves, self-insurance reserves and deferred tax asset valuation allowances.
New Accounting Pronouncements Not Yet Adopted	New Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” This guidance is in response to accounting concerns regarding contract modifications and hedge accounting because of impending rate reform associated with structural risks of interbank offered rates, and, particularly, the risk of cessation of the LIBOR related to regulators in several jurisdictions around the world having undertaken reference rate reform initiatives to identify alternative reference rates. The guidance provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The adoption of this guidance is effective for all entities as of March 12, 2020 through December 31, 2022. The Company does not expect the adoption of this guidance to have a material impact on its condensed consolidated financial statements and related disclosures.

Revenue Recognition (Tables)

Revenue Recognition (Tables)	9 Months Ended
	Oct. 29, 2022
Revenue From Contract With Customer [Abstract]
Schedule of Gift Card Liability, Breakage and Redemption Information	The table below sets forth selected gift card liability information (in thousands) for the periods indicated: October 29, 2022 January 29, 2022 October 30, 2021 Gift card liability, net of estimated breakage (included in accrued expenses) $ 13,658 $ 14,761 $ 13,201 The table below sets forth selected gift card breakage and redemption information (in thousands) for the periods indicated: 13-Week Period Ended 39-Week Period Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Gift card breakage revenue (included in net sales) $ 189 $ 200 $ 582 $ 611 Gift card redemptions recognized in the current period related to amounts included in the gift card contract liability balance as of the prior period 1,673 1,764 4,200 4,303

Income Taxes (Tables)

Income Taxes (Tables)	9 Months Ended
	Oct. 29, 2022
Income Tax Disclosure [Abstract]
Reconciliation of income tax expense (benefit)	A reconciliation of income tax expense at the statutory federal income tax rate to the amount provided is as follows (in thousands): 13-Week Period Ended 39-Week Period Ended October 29, October 30, October 29, October 30, 2022 2021 2022 2021 Tax at federal statutory rate $ ( 1,530 ) $ 1,896 $ ( 8,515 ) $ 2,373 State income taxes, net of federal benefit ( 223 ) 300 ( 689 ) 366 Tax credits 17 ( 29 ) ( 109 ) ( 35 ) Executive compensation ( 15 ) 65 101 80 Stock based compensation programs ( 43 ) ( 50 ) ( 596 ) ( 567 ) Valuation allowance 1,843 ( 409 ) 10,150 ( 519 ) Other 8 27 13 28 Income tax expense $ 57 $ 1,800 $ 355 $ 1,726

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	9 Months Ended
	Oct. 29, 2022
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Stock-Based Compensation	The table below sets forth selected stock-based compensation information (in thousands, except share amounts) for the periods indicated: 13-Week Period Ended 39-Week Period Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Stock-based compensation expense (included in compensation and benefits on the condensed consolidated statements of operations) $ 295 $ 438 $ 1,460 $ 1,321 Restricted stock units granted 50,000 — 409,800 152,815 Stock options granted 40,000 — 40,000 —

Share Repurchase Plan (Tables)

Share Repurchase Plan (Tables)	9 Months Ended
	Oct. 29, 2022
Treasury Stock Transactions [Abstract]
Schedule of Share Repurchase Plan Information	The table below sets forth selected share repurchase plan information (in thousands, except share amounts) for the periods indicated: 13-Week Period Ended 39-Week Period Ended October 29, October 30, October 29, October 30, 2022 2021 2022 2021 Shares repurchased and retired — 805,744 479,966 1,414,642 Share repurchase cost $ — $ 16,457 $ 6,253 $ 29,821

Description of Business and B_3

Description of Business and Basis of Presentation - Additional Information (Details)	Oct. 29, 2022 State Store
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Number of home decor and gifts store | Store	356
Number of states | State	35

Revenue Recognition - Additiona

Revenue Recognition - Additional Information (Details) - USD ($)	Oct. 29, 2022	Jan. 29, 2022	Oct. 30, 2021
Revenue From Contract With Customer [Line Items]
Liability for sales returns	$ 1,600,000	$ 1,400,000	$ 1,500,000
Sales return reserve products recovery asset	745,000	697,000	659,000
Deferred e-commerce revenue	1,200,000	1,000,000	1,100,000
Contract assets in inventory	616,000	518,000	545,000
Customer Loyalty Program
Revenue From Contract With Customer [Line Items]
Deferred revenue	$ 1,200,000	$ 1,300,000	$ 1,100,000

Revenue Recognition - Schedule

Revenue Recognition - Schedule of Gift Card Liability, Breakage and Redemption Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 29, 2022	Oct. 30, 2021	Oct. 29, 2022	Oct. 30, 2021	Jan. 29, 2022
Revenue From Contract With Customer [Abstract]
Gift card liability, net of estimated breakage (included in accrued expenses)	$ 13,658	$ 13,201	$ 13,658	$ 13,201	$ 14,761
Gift card breakage revenue (included in net sales)	189	200	582	611
Gift card redemptions recognized in the current period related to amounts included in the gift card contract liability balance as of the prior period	$ 1,673	$ 1,764	$ 4,200	$ 4,303

Income Taxes - Schedule of reco

Income Taxes - Schedule of reconciliation of income tax expense (benefit) at the statutory federal income tax rate (Details) - USD ($)	3 Months Ended		9 Months Ended
	Oct. 29, 2022	Oct. 30, 2021	Oct. 29, 2022	Oct. 30, 2021
Income Tax Disclosure [Abstract]
Tax at federal statutory rate	$ (1,530,000)	$ 1,896,000	$ (8,515,000)	$ 2,373,000
State income taxes, net of federal benefit	(223,000)	300,000	(689,000)	366,000
Tax credits	(17,000)	(29,000)	(109,000)	(35,000)
Executive compensation	(15,000)	65,000	101,000	80,000
Stock based compensation programs	(43,000)	(50,000)	(596,000)	(567,000)
Valuation allowance	1,843,000	(409,000)	10,150,000	(519,000)
Other	8,000	27,000	13,000	28,000
Income Tax Expense (Benefit), Total	$ 57,000	$ 1,800,000	$ 355,000	$ 1,726,000

Income Taxes - Additional Infor

Income Taxes - Additional Information (Details) - USD ($)	3 Months Ended		9 Months Ended
	Oct. 29, 2022	Oct. 30, 2021	Oct. 29, 2022	Oct. 30, 2021
Income Tax Disclosure [Abstract]
Income tax expense	$ 57,000	$ 1,800,000	$ 355,000	$ 1,726,000
Effective tax rate	0.80%	19.90%	0.90%	15.30%

(Loss) Earnings Per Share - Add

(Loss) Earnings Per Share - Additional Information (Details) - shares	3 Months Ended		9 Months Ended
	Oct. 29, 2022	Oct. 30, 2021	Oct. 29, 2022	Oct. 30, 2021
Earnings Per Share [Abstract]
Stock options and restricted stock units not included in the computation of diluted (loss) earnings per share (in shares)	531,000	168,000	597,000	145,000

Stock-Based Compensation - Stoc

Stock-Based Compensation - Stock-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 29, 2022	Oct. 30, 2021	Oct. 29, 2022	Oct. 30, 2021
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share Based Compensation	$ 295	$ 438	$ 1,460	$ 1,321
Stock options granted	40,000		40,000
Restricted Stock Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Granted	50,000	0	409,800	152,815

Stock-Based Compensation - Addi

Stock-Based Compensation - Additional Information (Details) - PSU	Jan. 28, 2023 shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Equity instruments other than options estimated to vest in period	0
Forecast
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Equity instruments other than options estimated to vest in period	0

Share Repurchase Plan - Additio

Share Repurchase Plan - Additional Information (Details) - USD ($) $ in Millions	Oct. 29, 2022	Jan. 06, 2022	Sep. 02, 2021	Dec. 03, 2020
Treasury Stock Transactions [Abstract]
Share repurchase plan, authorized amount		$ 30	$ 20	$ 20
Share repurchase plan, remaining authorized amount	$ 26.3

Share Repurchase Plan - Schedul

Share Repurchase Plan - Schedule of Share Repurchase Plan Information (Details) - USD ($)	3 Months Ended		9 Months Ended
	Oct. 29, 2022	Oct. 30, 2021	Oct. 29, 2022	Oct. 30, 2021
Treasury Stock Transactions [Abstract]
Shares repurchased and retired	0	805,744	479,966	1,414,642
Share repurchase cost	$ 0	$ 16,457,000	$ 6,253,000	$ 29,821,000

Senior Credit Facility - Additi

Senior Credit Facility - Additional Information (Details) - USD ($)	9 Months Ended
	Oct. 29, 2022	Jan. 29, 2022	Oct. 30, 2021
Line of Credit Facility [Line Items]
Revolving line of credit	$ 60,000,000	$ 0	$ 0
Revolving credit facility
Line of Credit Facility [Line Items]
Percentage of fee on unused portion of the facility	0.25%
Letters of credit outstanding, amount	$ 0
Revolving credit facility | Minimum
Line of Credit Facility [Line Items]
Interest at an annual rate equal to LIBOR plus a margin range	1.25%
Revolving credit facility | Maximum
Line of Credit Facility [Line Items]
Interest at an annual rate equal to LIBOR plus a margin range	1.75%
Secured credit facility | Revolving credit facility
Line of Credit Facility [Line Items]
Line of credit facility maximum borrowing capacity	$ 75,000,000
Swingline availability	10,000,000
Incremental accordion feature	25,000,000
Revolving line of credit	60,000,000
Available borrowing capacity of line of credit facility	$ 15,000,000

Impairment - Schedule of Impair

Impairment - Schedule of Impairment Information (Details) - USD ($) $ in Thousands	9 Months Ended
	Oct. 29, 2022	Oct. 30, 2021
Impairment [Abstract]
Asset Impairment Charges, Total	$ 447	$ 754

Subsequent Event - Additional I

Subsequent Event - Additional Information (Details) $ in Millions	Oct. 29, 2022 USD ($)
Subsequent Event [Line Items]
Repayment of outstanding borrowings under credit agreement	$ 30