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Ollie's Bargain Outlet Holdings, Inc. (OLLI - Free Report) reported fourth-quarter fiscal 2022 results, wherein the top and the bottom lines surpassed the Zacks Consensus Estimate and grew year over year. The Harrisburg, PA-based company also registered an increase in comparable store sales.
Here’s How the Top & the Bottom Lines Fared
Ollie's Bargain posted adjusted earnings of 84 cents a share, which beat the Zacks Consensus Estimate of 80 cents and increased 21.7% from the year-ago quarter.
Net sales of $549.8 million jumped 9.7% year over year due to a comparable store sales increase and new store unit growth. Markedly, the top line came above the consensus mark of $543 million, a beat after six straight misses.
Ollie's Bargain Outlet Holdings, Inc. Price, Consensus and EPS Surprise
We note that comparable store sales rose 3% in the quarter under discussion against a decline of 10.5% in the prior-year period.
A Look Into Margins
The gross profit grew 12.8% to $206.5 million during the quarter. The gross margin expanded 110 basis points to 37.6% due to reduced supply-chain costs.
Adjusted SG&A expenses increased 10.7% to $131.9 million from the prior-year quarter’s level due to investments in wages, increased utility costs and elevated selling expenses. As a percentage of net sales, adjusted SG&A expenses rose 20 basis points to 24%.
The adjusted operating income increased 16.5% to $66.8 million, while the operating margin expanded 70 basis points to 12.1% owing to higher gross margin and store unit growth. Adjusted EBITDA jumped 16.8% to $77.2 million during the quarter under review. The adjusted EBITDA margin increased 80 basis points to 14%.
Store Update
During the quarter, Ollie’s Bargain opened five new stores, bringing the total count to 468 stores in 29 states at the end of the period. This reflected an increase of 8.6% in the in-store count on a year-over-year basis. It introduced 40 stores and closed three stores in fiscal 2022.
The company intends to open 45 new stores, less one closure, in fiscal 2023.
Other Financial Aspects
Ollie’s Bargain ended the quarter with cash and cash equivalents of $210.6 million. The company had no borrowings outstanding under its $100 million revolving credit facility and $87 million of availability under the facility as of the end of fiscal 2022.
As of Jan 28, 2023, Ollie’s Bargain’s total borrowings (consisting solely of finance lease obligations) were $1.3 million. Inventories, as of the end of the fiscal year, inched up 0.7% to $470.5 million.
During the quarter under discussion, Ollie’s Bargain repurchased 245,328 shares for $11.9 million. This resulted in $41.8 million invested during the fiscal year.
During fiscal 2022, the company incurred capital expenditures of $51.7 million. For fiscal 2023, management projected capital expenditures of $125 million, principally for the construction of the company’s fourth distribution center and the expansion of the company’s York, PA distribution center along with new stores, store-level efforts and IT projects.
Outlook
Management now envisions fiscal 2023 net sales between $2.036 billion and $2.058 billion, suggesting an increase from $1.827 billion reported in fiscal 2022. Ollie’s Bargain now anticipates comparable store sales to rise in the band of 1-2% compared with the comparable store sales decrease of 3% reported last fiscal year.
Ollie’s Bargain currently envisions the gross margin rate in the bracket of 39.1-39.3% for fiscal 2023. The company reported a gross margin of 35.9% in the last fiscal year. The company now anticipates an operating income in the range of $205-$213 million for fiscal 2023, down from $130 million reported in fiscal 2022.
Management guided fiscal 2023 adjusted earnings in the range of $2.49-$2.58 per share, up from the adjusted earnings of $1.62 reported last fiscal.
Image Source: Zacks Investment Research
Shares of this Zacks Rank #2 (Buy) company have increased 14.9% in the past three months compared with the industry’s 6% decline.
Post Holdings, which is a consumer-packaged goods company, sports a Zacks Rank #1 (Strong Buy) at present. Post Holdings has a trailing four-quarter earnings surprise of 34.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for POST’s current financial-year sales and earnings suggests growth of 1.6% and 111.3%, respectively, from the year-ago reported numbers.
General Mills, a branded consumer foods company, currently carries a Zacks Rank of 2. GIS has a trailing four-quarter earnings surprise of 8.7%, on average.
The Zacks Consensus Estimate for General Mills’ current fiscal-year sales and earnings suggests growth of 5.2% and 6.1%, respectively, from the corresponding year-ago reported figures.
Hershey, the leader in chocolate and non-chocolate confectionery, currently carries a Zacks Rank of 2. HSY has a trailing four-quarter earnings surprise of 11.3%, on average.
The Zacks Consensus Estimate for Hershey’s current financial-year sales and earnings suggests growth of 7.8% and 10.2%, respectively, from the year-ago reported numbers.
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Ollie's Bargain (OLLI) Q4 Earnings Beat, Comps Rise Y/Y
Ollie's Bargain Outlet Holdings, Inc. (OLLI - Free Report) reported fourth-quarter fiscal 2022 results, wherein the top and the bottom lines surpassed the Zacks Consensus Estimate and grew year over year. The Harrisburg, PA-based company also registered an increase in comparable store sales.
Here’s How the Top & the Bottom Lines Fared
Ollie's Bargain posted adjusted earnings of 84 cents a share, which beat the Zacks Consensus Estimate of 80 cents and increased 21.7% from the year-ago quarter.
Net sales of $549.8 million jumped 9.7% year over year due to a comparable store sales increase and new store unit growth. Markedly, the top line came above the consensus mark of $543 million, a beat after six straight misses.
Ollie's Bargain Outlet Holdings, Inc. Price, Consensus and EPS Surprise
Ollie's Bargain Outlet Holdings, Inc. price-consensus-eps-surprise-chart | Ollie's Bargain Outlet Holdings, Inc. Quote
We note that comparable store sales rose 3% in the quarter under discussion against a decline of 10.5% in the prior-year period.
A Look Into Margins
The gross profit grew 12.8% to $206.5 million during the quarter. The gross margin expanded 110 basis points to 37.6% due to reduced supply-chain costs.
Adjusted SG&A expenses increased 10.7% to $131.9 million from the prior-year quarter’s level due to investments in wages, increased utility costs and elevated selling expenses. As a percentage of net sales, adjusted SG&A expenses rose 20 basis points to 24%.
The adjusted operating income increased 16.5% to $66.8 million, while the operating margin expanded 70 basis points to 12.1% owing to higher gross margin and store unit growth. Adjusted EBITDA jumped 16.8% to $77.2 million during the quarter under review. The adjusted EBITDA margin increased 80 basis points to 14%.
Store Update
During the quarter, Ollie’s Bargain opened five new stores, bringing the total count to 468 stores in 29 states at the end of the period. This reflected an increase of 8.6% in the in-store count on a year-over-year basis. It introduced 40 stores and closed three stores in fiscal 2022.
The company intends to open 45 new stores, less one closure, in fiscal 2023.
Other Financial Aspects
Ollie’s Bargain ended the quarter with cash and cash equivalents of $210.6 million. The company had no borrowings outstanding under its $100 million revolving credit facility and $87 million of availability under the facility as of the end of fiscal 2022.
As of Jan 28, 2023, Ollie’s Bargain’s total borrowings (consisting solely of finance lease obligations) were $1.3 million. Inventories, as of the end of the fiscal year, inched up 0.7% to $470.5 million.
During the quarter under discussion, Ollie’s Bargain repurchased 245,328 shares for $11.9 million. This resulted in $41.8 million invested during the fiscal year.
During fiscal 2022, the company incurred capital expenditures of $51.7 million. For fiscal 2023, management projected capital expenditures of $125 million, principally for the construction of the company’s fourth distribution center and the expansion of the company’s York, PA distribution center along with new stores, store-level efforts and IT projects.
Outlook
Management now envisions fiscal 2023 net sales between $2.036 billion and $2.058 billion, suggesting an increase from $1.827 billion reported in fiscal 2022. Ollie’s Bargain now anticipates comparable store sales to rise in the band of 1-2% compared with the comparable store sales decrease of 3% reported last fiscal year.
Ollie’s Bargain currently envisions the gross margin rate in the bracket of 39.1-39.3% for fiscal 2023. The company reported a gross margin of 35.9% in the last fiscal year. The company now anticipates an operating income in the range of $205-$213 million for fiscal 2023, down from $130 million reported in fiscal 2022.
Management guided fiscal 2023 adjusted earnings in the range of $2.49-$2.58 per share, up from the adjusted earnings of $1.62 reported last fiscal.
Image Source: Zacks Investment Research
Shares of this Zacks Rank #2 (Buy) company have increased 14.9% in the past three months compared with the industry’s 6% decline.
Three Other Stocks to Consider
Some other top-ranked stocks are Post Holding (POST - Free Report) , General Mills (GIS - Free Report) and The Hershey Company (HSY - Free Report) .
Post Holdings, which is a consumer-packaged goods company, sports a Zacks Rank #1 (Strong Buy) at present. Post Holdings has a trailing four-quarter earnings surprise of 34.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for POST’s current financial-year sales and earnings suggests growth of 1.6% and 111.3%, respectively, from the year-ago reported numbers.
General Mills, a branded consumer foods company, currently carries a Zacks Rank of 2. GIS has a trailing four-quarter earnings surprise of 8.7%, on average.
The Zacks Consensus Estimate for General Mills’ current fiscal-year sales and earnings suggests growth of 5.2% and 6.1%, respectively, from the corresponding year-ago reported figures.
Hershey, the leader in chocolate and non-chocolate confectionery, currently carries a Zacks Rank of 2. HSY has a trailing four-quarter earnings surprise of 11.3%, on average.
The Zacks Consensus Estimate for Hershey’s current financial-year sales and earnings suggests growth of 7.8% and 10.2%, respectively, from the year-ago reported numbers.