In an Ulta store in New York.
Scott Mlyn | CNBC
Ulta Beauty said on Thursday that fourth-quarter sales and profits were down year-on-year, hurt by weaker cosmetics sales during the pandemic.
Although the decline was smaller than expected, stocks fell as the beauty retailer gave a disappointing outlook for the coming year. Ulta shares were down more than 8% after the bell.
The company also announced that CEO Mary Dillon will step down in June and be replaced by President Dave Kimbell.
Dillon will also make the transition to become executive chairman of the company’s board of directors.
Kecia Steelman, Ulta’s Chief Store Operations Officer, is promoted to Chief Operating Officer.
Here’s what the company reported for the fourth quarter, compared to what Wall Street analysts expected, using a survey from Refinitiv:
- Earnings per share: $ 3.41, adjusted vs. Expected $ 2.35
- Revenue: $ 2.2 billion vs. $ 2.08 billion expected
“The Ulta Beauty team delivered better than expected results for the fourth quarter. Strong company-wide execution of our plans, combined with improving trends in consumer demand, resulted in solid results in multiple areas, including sales, transactions and profitability,” said Dillon. in a press release.
Ulta reported fourth quarter net profit of $ 171.5 million, or $ 3.03 per share, compared to $ 222.7 million or $ 3.89 per share a year earlier.
Excluding items, Ulta earned $ 3.41 per share, above the $ 2.35 per share expected by analysts polled by Refinitiv.
Net sales fell from $ 2.31 billion a year ago to $ 2.2 billion, exceeding expectations of $ 2.08 billion.
Sales in stores that have been open for at least 14 months fell 4.8% in the recent period, haunted by fewer transactions. The company said transactions were down 12.2%, but the average purchase per ticket was up 8.3%.
For fiscal 2021, Ulta expects to earn between $ 8.85 and $ 9.30 per share on revenues of $ 7.2 billion to $ 7.3 billion. The earnings forecast includes the impact of approximately $ 850 million in stock repurchases.
Analysts had expected Ulta to earn $ 10.61 per share on revenues of $ 7.32 billion, according to Refinitiv.
Sales in the same store are expected to be between 15% and 17%, the company said.
Ulta plans to open 40 net new stores and remodel approximately 21 stores in the coming year.
In November, Ulta announced plans to open small cosmetics stores in hundreds of Target stores across the country to increase sales and expand its reach.
The cosmetics retailer was injured during the pandemic due to temporary store closures. After reopening stores in July, the company saw its demand return with a strong comeback in its mobile app and ecommerce website.
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