Ulta Beauty sales increase 12.3 percent for Q1, 2023

Ulta Beauty has reported another increase in its net sales for the 13-week period ended April 29, 2023, rising 12.3 percent to 2.6 billion dollars, compared to 2.3 billion dollars in the same period last year.

The retailer said the results came due to an increase in comparable sales, which rose 9.3 percent, a strong new store performance and growth in other revenue.

Ulta’s gross profit, meanwhile, increased 12.1 percent to 1.1 billion dollars, up from 941 million dollars. As a percentage of net sales, its gross profit decreased to 40 percent, from 40.1 percent due to lower merchandise margins and higher supply chain costs.

Its selling, general and administrative expenses increased 22.2 percent to 612.1 million dollars, while its operating income increased 1 percent to 442.1 million dollars, or 16.8 percent of net sales.

Its net income also rose 4.7 percent to 347.1 million dollars, compared to its previous 331.4 million dollars.

Ulta’s diluted earnings per share rose 9.2 percent to 6.88 dollars, up from 6.30 dollars the previous year.

The retailer’s cash and cash equivalents at the end of Q1 totaled 636.4 million dollars, while its merchandise inventories increased to 1.75 billion dollars from 1.57 billion dollars.

In a release, CEO Dave Kimbell, said the year was off to a “positive start”, with the team delivering on internal expectations and growth seen across key categories.

Kimbell added: “While we expect the operating environment to continue evolving, we remain confident in the resilience of the beauty category and in our ability to drive share and profitable growth with our proven business model, a diverse, best-in-class assortment, an industry-leading loyalty program, and our world-class team.”

In light of the positive results, Ulta slightly increased its net sales outlook for FY23 from between 10.95 and 11.05 billion dollars to 11 and 11.1 billion dollars.

It also adjusted its operating margin for the year, lowering it from between 14.7 and 15 percent to 14.5 and 14.8 percent.