At Home Group Inc (NYSE: HOME) stock surged over 17.7% on March 23rd, 2018 (as of 10:21 AM GMT-4 ; Source: Google finance). For the Fourth quarter of 2017, the net sales rose 25% including a 5.7% increase in the comparable store sales which is the group’s 15th consecutive quarter of 20 plus percent of sales growth and their sixteenth consecutive quarter of positive comps. The group reported a pro forma adjusted net income rise of 86% for the fourth quarter.
For fiscal 2018, they enhanced their store count by 21%, delivered 24% net income to be net sales growth and grew comp store sales by 6.5%. Adjusted operating income rose 30% while margins expanded 50 basis points. The group continues to leverage their major topline strength to reinvest in the future of their business via incremental advertising and new stores, ultimately delivering pro forma adjusted net income growth of 64% in fiscal 2018.
The group enhanced their store count by 2.5 times since the last five years and finished a top to bottom rebranding. They invested heavily in their team members and their benefits and launched a new inventory planning allocation POS systems, automated as well as expanded their distribution center.
The group expects to generate at least 30% earnings growth this year all while continuing to use their business model as an engine for reinvestment in the following strategic priorities. Their credit card enrollment exceeded their internal targets as well as their insider program exceeded 1 million members in only the first five months.
The group believes that CRM initiatives would deliver more targeted in personalized shopping experience. The group is also targeting to have the broadest assortment of in-store decor at the lowest prices in the industry. Their unique ability to flex their assortment across styles resonated in fiscal 2018 wherein the group witnessed a double digit growth in contemporary, modern farmhouse and whimsical look that appeal to younger customers who represent their fastest growing demographic.
For fiscal 2019, Customers would find extensive newness in both patio furniture as well as cushions along with the seemingly endless assortment of functional yet fun garden decor. New store expansion continues to be a major strategic priorities.