News

Financials pose a pretty picture for Ulta Beauty

June 2, 2016

In stark comparison to other retail financial reports of late, Ulta Beauty is enjoying robust sales, and the shiny outlook is prompting the beauty retailer to boost its expectations for the rest of the year.

Total sales jumped 23.7 percent and comparable sales increased 15.2 percent for the 13-week period ended April 30 comparing results to same period ended May 2, 2015, according to a company announcement.

"We are off to a phenomenal start to the year, delivering excellent top and bottom line growth in the first quarter," said Mary Dillon, CEO, in the announcement. "Several positive factors are coming together to drive the momentum in our business, exemplified by the best comparable sales growth in our history as a public company. These include healthy consumer demand in the beauty category, our unique format and offering which are supporting sustained share gains, and effective collaboration across the enterprise to ensure strong execution of our growth strategies."

In the quarter, the same stores increase boost was due to 11.0 percent traffic growth and a 4.2 percent growth in average ticket. Retail comparable sales increased 13.9 percent, including salon comparable sales growth of 7.7 percent and salon sales increased 14.7 percent to $58.9 million from $51.3 million in the first quarter of fiscal 2015.

In regard to ecommerce sales jumped 38.8 percent, to $61.0 million.

Merchandise inventories at the end of the first quarter of fiscal 2016 totaled $843.5 million, compared to $662.9 million at the end of the first quarter of fiscal 2015, representing an increase of $180.6 million. Average inventory per store increased 14.5 percent, compared to the first quarter of fiscal 2015. The increase in inventory was driven by 89 net new stores, the opening of the company's fourth distribution center in Greenwood, Indiana, investments in inventory to ensure high in-stock levels to support sales growth, and incremental inventory for new brands and in-store prestige brand boutiques.

In the first quarter the retailed opened 13 stores and ended the quarter with 886 stores.

It predicts net sales in the second quarter of fiscal 2016 to be in the range of $1,041 million to $1,058 million, compared to actual net sales of $877.0 million in the second quarter of fiscal 2015 and predicts to achieve comparable sales growth of approximately 10 percent to 12 percent, including the impact of the e-commerce business, compared to previous guidance of 8 percent to 10 percent.