Ulta Salon Q2 beats market estimates
Sep 9, 2011
Sept 8 (Reuters) - Ulta Salon, Cosmetics & Fragrance Inc became the latest company in the U.S. beauty industry to post strong results and give a rosy outlook for the current quarter, as new products and promotions help drive growth.
The company has targeted male customers through new product launches, and had announced the roll out of men's grooming boutiques inside most of its stores, earlier this year.
This strategy appears to be paying off for Ulta, which sells cosmetics, fragrance, haircare and other beauty products.
Ulta, which competes with salons, mass market retailers, department stores and boutique sellers of beauty products, is working to build its image as a one-stop destination for everything from low-priced nail polish to high-end hair dryers, fragrances and even haircuts.
Ulta, which also offers a full-service salon in all of its stores, has now topped Wall Street earnings estimates for over two years as new products, promotions and customer loyalty programs have spurred growth in sales and margins.
For the third quarter, the retailer expects to earn 36-38 cents a share on revenue of $400-$407 million for the August-October quarter.
Analysts, on average, were looking for third-quarter profit of 34 cents per share, on revenue of $395.5 million, according to Thomson Reuters I/B/E/S.
Ulta, which operates 415 stores across 42 states, plans to expand its total store count to roughly 1,000 in the long run.
Comparable sales or those at stores open at least a year grew 11.3 percent in the second quarter.
May-July net income jumped 82 percent to $23.9 million, or 38 cents a share, topping market expectations of 32 cents a share.
Revenue rose 22.6 percent to $394.6 million. Analysts had expected revenue of $384.1 million for the second quarter.
The Bolingbrook, Illinois-based company's shares rose 2 percent in extended trade on Thursday. They had closed at $59.76 on Nasdaq.
(Reporting by Meenakshi Iyer in Bangalore; Editing by Viraj Nair)
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