Ulta reports strong sales and earnings growth, suspends beauty services due to coronavirus
Mar 13, 2020
American cosmetics retailer Ulta Beauty, Inc. announced solid growth in its fourth-quarter and full-year 2019 sales and earnings on Thursday and provided an update on the measures it is taking in its stores to deal with the coronavirus pandemic.
Net sales at the company in the fourth quarter ended February 1, 2019, increased 8.5% to $2.3 billion, up from $2.1 billion in the prior-year period, while comparable sales rose 4.0%.
The retailer’s net income for the period totaled $222.7 million, a 3.7% increase compared to the $214.7 million reported by the company in Q4 2018. Diluted earnings per share (EPS) rose 7.8% to $3.89, up from $3.61 in the same period in the previous year.
“The Ulta Beauty team delivered results for the fourth quarter at the high end of our expectations, and I am proud of how our teams worked together to serve our guests this holiday season,” said Ulta Beauty CEO Mary Dillon in a release. “Our enhanced omnichannel capabilities, combined with our merchandise exclusives, cross-category marketing events, and great execution by our store teams, enabled us to expand our market share and deliver a successful quarter.”
For the full fiscal year 2019, Ulta reported net sales of $7.4 billion, representing a year-over-year increase of 10.1% from $6.7 billion in fiscal 2018. Annual comparable sales rose 5.0%.
Net income increased 7.2% to $705.9 million, up from $658.6 million, while diluted EPS was $12.15, up 11.1% from $10.94.
During the fourth quarter Ulta opened 13 new stores, finishing fiscal 2019 with 1,254 locations. In 2020 the company intends to open 75 new stores.
Among Ulta’s other previsions for 2020, the company expects to achieve an increase of between 7.0% and 8.0% in annual sales and a rise of between 3.0% and 4.0% in comparable sales. Diluted EPS are expected to be in the range of $12.55 to $12.75.
The retailer’s predictions for 2020 do not currently include any assumptions related to the potential negative impact of the ongoing coronavirus outbreak.
Having initially announced on Wednesday that its stores would be implementing increased sanitation measures in response to the Covid-19 pandemic, Ulta revealed that it would be taking further steps to combat the spread of the virus on Thursday.
The retailer stated that it is temporarily stopping the skin, makeup, brow, lash and waxing services in its stores, and adopting a no-touch approach for selling assistance, such as shade matching. In-store hair services will continue for the moment but with an increased emphasis on hand washing, tool sanitization and the cleaning of chairs and hard surfaces.
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