Ulta Beauty said Thursday that fourth-quarter sales and profit fell from the prior year, hurt by weaker sales of cosmetics during the pandemic.
Although the decline was smaller than expected, shares fell as the beauty retailer gave a disappointing outlook for the coming year. Ulta shares fell more than 8% after the bell.
The company also announced that its CEO Mary Dillon will step down in June, and be replaced by President Dave Kimbell.
Dillon will also transition to executive chair of the company’s board.
Kecia Steelman, Ulta’s chief store operations officer, will be promoted to chief operating officer.
Here’s what the company reported for its fourth quarter, compared with what Wall Street analysts expected, using a survey from Refinitiv:
- Earnings per share: $3.41, adjusted vs. $2.35 expected
- Revenue: $2.2 billion vs. $2.08 billion expected
“The Ulta Beauty team delivered better-than-expected results for the fourth quarter. Strong, enterprise-wide execution of our plans, combined with improving trends in consumer demand, resulted in solid results across multiple metrics, including sales, transactions and profitability,” Dillon said in a press release.
Ulta reported fiscal fourth-quarter net income of $171.5 million, or $3.03 per share, compared with $222.7 million, or $3.89 per share, a year earlier.
Excluding items, Ulta earned $3.41 per share, topping the $2.35 per share expected by analysts surveyed by Refinitiv.
Net sales fell to $2.2 billion from $2.31 billion a year ago, beating expectations of $2.08 billion.
Sales at stores open at least 14 months fell 4.8% in the latest period, hurt by fewer transactions. The company said transactions declined 12.2%, however, the average purchase per ticket rose 8.3%.
For fiscal 2021, Ulta expects to earn between $8.85 and $9.30 per share on revenue of $7.2 billion to $7.3 billion. The earnings forecast includes the impact of about $850 million of stock buybacks.
Analysts had been expecting Ulta to earn $10.61 per share on revenue of $7.32 billion, according to Refinitiv.
Same-store sales are expected to be in the range of 15% to 17%, the company said.
Ulta plans to open 40 net new stores and remodel about 21 stores in the coming year.
In November, Ulta announced plans to open up small cosmetic shops within hundreds of Target stores across the country in order to achieve higher sales and expand its reach.
The cosmetics retailer has been hurt by temporary store closures during the pandemic. After reopening stores in July, the company saw its demand return with a strong comeback in its mobile app and e-commerce website.
Read the full earnings release here.
Source: Business - cnbc.com
