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Ulta Records Estimate-beating Quarter
Posted: December 2, 2011
Ulta Beauty announced financial results for the third quarter and first nine months of 2011, which ended Oct. 29, 2011 and compares to the same period ended Oct. 30, 2010. The company saw a strong quarter, beating estimates as it increased net sales and increased its market share, and saw revenue up 22% to $413.1 million.
For the third quarter, net sales increased 21.8% to $413.1 million from $339.2 million in the third quarter of fiscal 2010; comparable store sales (sales for stores open at least 14 months) increased 9.6% compared to an increase of 12.2% in the third quarter of fiscal 2010; and gross profit increased 100 basis points to 36.1% from 35.1% in the third quarter fiscal 2010.
“Our outstanding third quarter results were highlighted by a 21.8% increase in total net sales, a 350 basis point increase in operating margin to 10.7% and an 88.5% increase in net income with diluted earnings per share of $0.42, exceeding the high-end of our guidance by $0.04 per share,” stated Chuck Rubin, president and CEO of Ulta Beauty. “During the quarter, we gained market share, driven by a 9.6% increase in comparable store sales following a 12.2% comparable store sales gain in the third quarter last year. Ulta continues to increase its leadership position in beauty as we offer the broadest selection of products and services, all focused on compelling trend and value statements. Our new store expansion continued successfully and included the opening of 28 stores with an additional seven new stores opened in the fourth quarter to complete our 2011 store program for a 16% increase in square footage. We remain optimistic about our ability to continue our strong momentum in the fourth quarter and believe we have an exciting line up of merchandising and marketing plans in place to maximize the holiday season. Based on the quality and strength of our new store pipeline we expect to accelerate our 2012 square footage expansion to the high end of our long term 15–20% growth range. We expect the continued implementation of our growth strategies along with the disciplined execution of our team to result in a strong performance in the near and long term.”
For the first nine months, net sales increased 21.7% to $1,193.6 million from $981.2 million in the first nine months of fiscal 2010; comparable store sales (sales for stores open at least 14 months) increased 10.7% compared to an increase of 11.3% in the first nine months of fiscal 2010; gross profit increased 170 basis points to 35.1% from 33.4% in the first nine months of fiscal 2010; and net income increased 80.7% to $74.0 million compared to $40.9 million in the first nine months of fiscal 2010.
Also during the third quarter, the company opened 28 new stores located in Minnesota, North Carolina, California, Ohio, Texas, Louisiana, Kentucky, Alabama, Utah, Maryland, Tennessee, Georgia, Massachusetts, Michigan, Florida, Kentucky, Pennsylvania, Washington and New York State, as well as relocated one store in Mississippi. In addition, the company closed one store during this time, ending the third quarter with 442 stores and square footage of 4,673,131, which represents a 16% increase in square footage compared to the third quarter of fiscal 2010.