Ulta Beauty announced its third quarter 2020 fiscal results that showed net sales were $1.6 billion, a 7.8% decrease compared to $1.7 billion in the prior-year period. Nine month sales for 2020 totaled $4.0 billion, compared to $5.1 billion in 2019.
Net income was $74.8 million compared to $129.7 million in the third quarter of fiscal 2019. Adjusted net income was $92.5 million compared to $128.6 million in the third quarter of fiscal 2019.
Gross profit decreased 12.5% to $545.5 million compared to $623.4 million in the third quarter of fiscal 2019. As a percentage of net sales, gross profit decreased to 35.1% compared to 37.1% in the third quarter of fiscal 2019
Comparable sales (sales for stores open at least 14 months, including stores temporarily closed due to COVID-19, and e-commerce sales) decreased 8.9% compared to an increase of 3.2% in the third quarter of fiscal 2019. In the third quarter of fiscal 2020, transactions declined 15.4% and average ticket increased 7.6%.
Operating income decreased to $101.3 million, or 6.5% of net sales, compared to $167.8 million, or 10.0% of net sales, in the third quarter of fiscal 2019. Adjusted operating income was $124.9 million, or 8.0% of net sales.
Ulta Beauty ended the third quarter of fiscal 2020 with $560.9 million in cash and cash equivalents. Merchandise inventories net at the end of the third quarter of fiscal 2020 totaled $1.4 billion compared to $1.6 billion at the end of the third quarter of fiscal 2019.
“Today, we reported financial results that exceeded our expectations as we continue to navigate a year of uncertainties with agility and strength,” said Mary Dillon, chief executive officer. “I am proud of how well our teams are responding and leading throughout this difficult period, and I want to thank all of our Ulta Beauty associates for their continued commitment to serving our guests and taking care of each other during this unprecedented time.”
“We know guests are changing how they shop beauty, but importantly, their engagement with the category remains strong,” continued Dillon. “As a well-loved brand curating all things beauty, all in one place, we take great pride in our responsibility to lead the industry and redefine beauty experiences for guests, inclusive of safety measures. As the prevalence of COVID-19 increases across the country, we will continue to monitor closely and adjust operations as needed to ensure the safe delivery of beauty essentials.”