Burlington Stores beats market estimates with 66 cents EPS in Q2

The U.S. off-price retailer of branded apparel at everyday low prices, today announced comfortably beat market estimates with 66 cents Earnings Per Share (EPS) in the second quarter.

The company´s CEO, Tom Kingsbury, stated, “We are extremely pleased to report strong second quarter results, driven by a 3.5 percent comparable store sales increase, which was on top of a 5.4 percent comparable increase in last year’s second quarter.

Burlington Stores to enjoy a Q3 plentiful of opportunities

As a result, the company enjoyed an 85 percent increase in adjusted EPS in the second quarter, “well ahead” its previous guidance.

The key to this strong performance? “Our inventories are fresh, we are well positioned for Back to School, and we have significant open-to-buy entering the third quarter as opportunities remain plentiful. I want to thank our store, supply chain and corporate teams for contributing to these strong results,” as summarized by the company in a statement.

Total sales in second quarter increased 8.6 percent to 1,363 million dollars

Over the second quarter of their fiscal year 2017, total sales increased 8.6 percent over the prior year period to 1,363 million dollars. This growth was driven by an increase of 70 million dollars from new and non-comparable stores. Additionally, the retailer registered a 3.5 percent comparable store sales increase.

Meanwhile gross margin expanded by 110 basis points over last year’s levels to 40.7 percent driven primarily by increased merchandise margin.

Net income increased 130 percent over the prior year period to 47 million dollars, or 66 cents per diluted share vs. 28 cents last year. Adjusted Net Income increased 82 percent to 51 million dollars, or 72 cents per diluted share vs. 39 cents last year.

At the close of the quarter, fully diluted shares outstanding were 70.8 million, compared with 72 million outstanding at the end of last year’s second quarter. “The decrease was primarily the result of share repurchases under the company’s share repurchase programs. Since the end of the second quarter of Fiscal 2016, the company has repurchased 3.2 million shares of its common stock under its share repurchase programs,” explained the executive team in a corporate note.

Adjusted EBITDA increased 28 percent, or 28 million dollars above the prior year period, to 127 million dollars.

Improved FY guidance for EPS to come in between 4.11 and 4.18 dollars

For the full Fiscal Year 2017 (the 53-weeks ending February 3, 2018), the company now expects total sales to increase in the range of 8.4 percent to 8.9 percent, including 1.4 percent from the 53rd week; this assumes comparable store sales to increase in the range of 2 percent to 3 percent for the second half of the year, resulting in a full year comparable store sales increase of 2 percent to 2.5 percent on top of the 4.5 percent increase during Fiscal 2016.

New guidance also includes an interest expense of approximately 58 million dollars; adjusted EPS in the range of 4.11 to 4.18 dollars and an expected benefit from the 53rd week of approximately 4 cents per share, and an anticipated increase of approximately 17 cents per share resulting from the recent change in accounting rules for share-based compensation.