Citi Trends, Inc. confirmed that Macellum SPV III, LP (“Macellum”) has provided notice of its nomination of four individuals to stand for election to the Citi Trends Board of Directors at the Company’s 2019 Annual Meeting of Stockholders (“2019 Annual Meeting”).

The Board's recommendation regarding director nominees will be made in the Company's definitive proxy materials, which will be filed with the Securities and Exchange Commission and mailed to all stockholders eligible to vote at the 2019 Annual Meeting. The date of the Company’s 2019 Annual Meeting has not yet been announced. Stockholders are not required to take any action at this time.

The Company issued the following statement:

Citi Trends is executing on a strategic plan focused on growing our business by being the leader in providing value-priced urban fashions to our customers. The Company has already begun to make progress on that plan, which includes operational initiatives to improve freight efficiencies and reduce several operating expense categories, systems initiatives such as store level merchandise planning and markdown optimization, and a test of the opportunity in Hispanic-dominated markets. Citi Trends recently provided details regarding its performance and long-term growth opportunities and goals as a result of these initiatives, including:

• Fiscal 2018 earnings per share up 59% year over year;

• Earnings per share of $4 within the next five years;

• Consistent comparable store sales growth in the range of approximately 3%;

• Projected annual store square footage growth of 4% to 5%;

• Store base potential up to 800 stores; and

• Continued return of excess capital to stockholders, including the authorization of a $25 million share repurchase program. In 2018, the Company returned approximately $45 million to stockholders in the form of repurchases and dividends.

The Citi Trends Board – other than Jonathan Duskin, who is the Chief Executive Officer of Macellum and a current member of the Citi Trends Board – comprises six highly qualified directors, five of whom are independent, and all of whom are actively engaged in the execution of the Company’s plan. These directors have a wide range of relevant and critical experiences, including in the areas of finance, merchandising, retail operations, distribution, marketing and advertising.

Importantly, the Board has been committed to regular refreshment and has reduced the average tenure of its independent board members to approximately six and a half years. To that end, as part of its regular refreshment process, the Board is undergoing a comprehensive search for the best director candidates to further enhance the skills and expertise of the current Board and did not want to limit itself to one director’s suggestions. The Board has evaluated Macellum’s nominees as part of that process and will soon communicate its recommendations to stockholders.

The Board has held numerous discussions over the last few weeks with Mr. Duskin regarding board composition and the Board’s ongoing director search process. These conversations were aimed at preventing Mr. Duskin from waging yet another costly proxy fight. Despite Macellum’s misleading claims, the Board has held these conversations with the goal of working collaboratively and coming to a conclusion that benefits all stockholders. On the other hand, Mr. Duskin has requested being compensated for the fees his firm incurred as a result of his proxy contest of two years ago, which is inconsistent with his statements regarding the Company wasting stockholder resources. The Company is disappointed that Mr. Duskin has, once again, threatened a prolonged and expensive fight, rather than resolving this matter constructively.

The Board and management team are committed to acting in the best interests of all Company stockholders and as always, remain open to constructive views from its stockholders towards the common goal of maximizing long-term stockholder value.