Ulta Beauty Inc (NASDAQ:ULTA) Beats Analysts’ Estimates

Ulta Beauty Inc (NASDAQ:ULTA) stock rose 9.02% (As on May 27, 11:10:08 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the first quarter of FY 22. Comparable sales (sales for stores open at least 14 months and e-commerce sales) increased 18.0%, driven by a 10.0% increase in transactions and an 7.3% increase in average ticket. Net income increased to $331.4 million compared to $230.3 million in the first quarter of fiscal 2021. Cash and cash equivalents at the end of the first quarter of fiscal 2022 totaled $654.5 million. Merchandise inventories, net at the end of first quarter of fiscal 2022 increased to $1.57 billion compared to $1.35 billion at the end of the first quarter of fiscal 2021. The increase reflects the addition of 28 net new stores, inventory to support new brand launches, and the acceleration of inventory receipts to support expected demand and mitigate anticipated global supply chain disruptions. Real estate activity in the first quarter of fiscal 2022 included 10 new stores located in Cranston, RI; Las Vegas, NV; Meriden, CT; North Hollywood, CA; Prince Frederick, MD; Riverside, CA; Stephenville, TX; Vienna, VA; Warrenton,VA; and Woodbridge, NJ. In addition, the Company relocated six stores. At the end of the first quarter of fiscal 2022, the Company operated 1,318 stores totaling 13.9 million square feet.

ULTA in the first quarter of FY 22 has reported the adjusted earnings per share of $6.28, beating the analysts’ estimates for the adjusted earnings per share of $4.44. The company had reported the adjusted revenue growth of 21.1 percent to $2.35 billion in the first quarter of FY 22, beating the analysts’ estimates for revenue of $2.12 billion. Gross profit increased to $941.0 million compared to $753.8 million in the first quarter of fiscal 2021. As a percentage of net sales, gross profit increased to 40.1% compared to 38.9% in the first quarter of fiscal 2021, primarily due to leverage in fixed costs, strong growth in other revenue, and favorable channel mix shifts, partially offset by lower merchandise margin. Operating income increased to $437.7 million, or 18.7% of net sales, compared to $305.3 million, or 15.8% of net sales, in the first quarter of fiscal 2021.

Additionally, during the first quarter of fiscal 2022, the Company repurchased 331,834 shares of its common stock at a cost of $132.8 million. As of April 30, 2022, $1.87 billion remained available under the $2.0 billion share repurchase program announced in March 2022.

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