FINANCE

Big Lots tops Q3 earnings estimates

BY Marianne Wilson

Big Lots reported better-than-expected third quarter earnings and raised its full-year forecast as its looks towards what it expects will be a successful holiday season.

The discounter reported income of $4.4 million, or $0.10 per diluted share, for the quarter ended Oct. 28, up from $1.38 million or $0.3 cents per share in the same quarter last year. This year’s results included a gain from an insurance settlement. Excluding the settlement, adjusted income totaled $2.5 million, or $0.06 per diluted share.

Same-store sales rose 1.0%. Net sales inched up 0.5% to $1.1 billion, a result of the comparable store sales increase partially offset by a lower store count year-over-year.

“In a challenging retail environment, the team delivered on our financial commitments with sales in line with our communicated guidance and EPS growth above our expectations,” said David Campisi, CEO and president of Big Lots, which operates 1,430 stores. “(Our core customer) continues to respond positively to our strategy focusing on ownable and winnable merchandise categories, improved merchandise presentations, and more consistent, friendly customer service and in-store execution.”

Big Lots boosted its earnings guidance for its current fiscal year. It is now projecting earnings of $4.23 to $4.28 per share, not including the insurance settlement, up from an August projection of $4.15 to $4.25 per share. It estimates 1% comparable-store sales increase and a 2% increase in total sales.

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Ulta Beauty Q3 earnings top estimates, but outlook is mixed

BY Marianne Wilson

The powerhouse that is Ulta Beauty delivered another strong quarter of earnings and revenue even as its same-store sales growth cooled.

Net income increased 19.5% to $104.6 million, or $1.70 a share, in the quarter ended Oct. 28, compared to $87.6 million, or $1.40 per share, in the year-ago period. Analysts had expected earnings of $1.66 a share.

Net sales increased 18.6% to $1. 34 billion from $1.13 billion last year. The retailer estimated approximately $14 million in lost sales due to Hurricanes Harvey and Irma.

Total same-store sales increased 10.3%, compared to an increase of 16.7% last year, and were driven by 6.0% transaction growth and 4.3% growth in average ticket. The company estimates that Hurricanes Harvey and Irma resulted in approximately 100 basis points of negative impact to comparable stores sales in the third quarter of fiscal 2017.

E-commerce sales grew 62.9% to $119.8 million from $73.6 million last year, representing 370 basis points of the total company comparable sales increase of 10.3%.

“Our third quarter results clearly demonstrate the strength and distinct advantages of the Ulta Beauty business model,” said Mary Dillon, CEO. “We delivered double digit comparable sales growth, in spite of a moderation in the growth rate of our largest category — makeup — and meaningful disruption from hurricanes. We flexed our merchandising and marketing plans, leveraged our consumer insights and CRM platform, and worked with our brand partners to create compelling offers for our guests.”

Ulta expects fourth-quarter sales between $1.93 million to $1.96 million, with a same-store sales increase of 8% to 10%. It estimated fourth-quarter per-share earnings between $2.73 to $2.78. Analysts were looking for earnings of $2.83 a share on sales of $1.93 billion and a same-store sales increase of 9.4%

During the third quarter, the retailer opened 48 stores. It ended the quarter with 1,058 stores.

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Costco blows it away in November with double-digit comp growth

BY Marianne Wilson

Costco Wholesale Corp. easily topped expectations in November, reporting its 14th straight month of sales growth.

Costco “turned in a month for the ages in the current retail environment,” Ken Perkins, analyst at Retail Metrics, told MarketWatch.

Net sales surged 13.2% to $11.26 billion in November, up from $9.95 billion in the year-ago period. Online sales rose 39%, and were up 44% in the 12-week period through Nov. 26, helped by an expanded assortment and faster delivery times.

Costco’s total same-store sales rose 10.8%, its biggest monthly gain since September 2011. Excluding the impacts from changes in gasoline prices and foreign exchange, U.S. same-store sales rose 8.4%. 6.3% in Canada and 7.2% internationally.

Customer traffic at Costco’s U.S. locations was up 5.9% in November. The retailer saw growth across hardline and soft line categories, as well as food and sundries.

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