Ulta says Q1 results ‘exceeded expectations’
The company, which markets a range of mainstream cosmetic brands in stores nationwide, reported a 19.1 percent increase in net sales; a figure of $320.2m compared to the same period the previous year.
Comparable store sales (sales for stores open at least 14 months) for the quarter grew 10.8 percent, contrasting with the 2.3 percent decrease witnessed last year. Net income came in at $13.7m; a 177.7 percent increase when compared to the $4.9m recorded in Q1 2009.
‘Excellent start’ to fiscal 2010 for Ulta
Ulta CEO Lyn Kirby said the company’s success was due to its continuing focus on three priorities outlined in 2009.
“We attribute our ongoing strength to the success of our strategies including increasing profitable market share by capitalizing on the advantages of our business model with dynamic marketing, compelling brands and providing our customers with the preferred beauty shopping experience,” she said.
During an earnings call, Kirby said that the company continued to drive growth in its prestige colour and skin segments, and a good performance was seen across mass colour, skin and hair as well as private label.
Ulta plans to extend its prestige offering with the introduction of the Philosophy skin care line during the second quarter of 2010.
Growth strategy for 2010
Kirby said that given the tough economic conditions, rather than relying on consumers to spend more, the company will utilize its marketing in order to increase the number of visitors to its stores and encourage existing customers to shop with Ulta more often.
The company also plans to continue with its store expansion plans by opening 46 new stores during the financial year.. At the end of the first quarter, the number of Ulta stores totaled 347; a 9 percent increase on 2009.
According to Ulta, net sales for Q2 2010 are expected to be in the range of $311m-317m, compared to actual net sales of $273.5m recorded for the same period in 2009.
“We continue to believe we have developed a strong foundation to achieve sustained long term growth and believe fiscal 2010 will represent another strong year for Ulta,” said Kirby.
Ulta recently appointed Chuck Rubin to the position of President and chief operating officer, and he will eventually take over from Kirby as CEO.
