Ulta Beauty sees double-digit gains in Q1

BOLINGBROOK, Ill. — Ulta Beauty posted strong double-digit gains in sales and net income during first quarter 2014.

“Ulta Beauty delivered strong sales and earnings growth in the first quarter,” said Mary Dillon, CEO. “The team’s accomplishments included improving retail transactions which turned positive, driving continued momentum in our online business, successfully rolling out new brands, completing a smooth conversion of our loyalty program members onto one platform and managing inventory very well.”

For the first quarter ended May 4, net sales increased 22.5% to $713.8 million from $582.7 million in the first quarter of fiscal 2013. Comparable-store sales (sales for stores open at least 14 month and e-commerce sales) increased 8.7%. E-commerce comparable-sales grew 72.3%. Net income increased 19.4% to $50.0 million compared with $41.8 million in the first quarter of fiscal 2013. Income per diluted share increased 18.5% to 77 cents compared with 65 cents in the first quarter of fiscal 2013.

For the second quarter, Ulta currently expects net sales in the range of $706 million to $717 million, compared with actual net sales of $601 million in the second quarter of fiscal 2013. Comparable-store sales for the second quarter of 2014 are expected to increase 5% to 7%. The company reported a same-store sales increase of 8.4% in the second quarter of 2013.

Income per diluted share for the second quarter of fiscal 2014 is estimated to be in the range of 78 cents to 83 cents. This compares with income per diluted share for the second quarter of fiscal 2013 of 70 cents.

The company also reiterated its previously announced fiscal 2014 guidance. The company plans to achieve comparable-store sales growth of approximately 4% to 6%, including the impact of the e-commerce business; expand square footage by 15% with the opening of 100 net new stores; increase total sales in the mid-teens percentage range; remodel 12 locations; deliver earnings per share growth in the mid-teens percentage range; incur capital expenditures of approximately $265 million in fiscal 2014, compared to $226 million in fiscal 2013; and generate free cash flow in excess of $100 million.

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