Ulta Beauty reports Q3 sales dip
Bolingbrook, Illinois-based cosmetics retailer Ulta Beauty, Inc. announced a 7.8 percent decline in third-quarter net sales on Thursday as it continues to be impacted by the Covid-19 pandemic and its efforts to contain it.
For the third quarter ended October 31, 2020, the company’s sales totalled $1.6 billion compared to $1.7 billion in the third quarter of fiscal 2019.
Comparable sales and e-commerce sales for the quarter fell 8.9 percent compared to an increase of 3.2 percent in the third quarter prior, with transactions declining 15.4 percent, while average ticket increased 7.6 percent.
The beauty retailer's earnings decreased to $74.8 million, or $1.32 a share, compared to a year earlier, where net income at Ulta was $129.7 million, or $2.25 a share.
“We know guests are changing how they shop beauty, but importantly, their engagement with the category remains strong,” said Mary Dillon, chief executive officer.
“As a well-loved brand curating all things beauty, all in one place, we take great pride in our responsibility to lead the industry and redefine beauty experiences for guests, inclusive of safety measures. As the prevalence of Covid-19 increases across the country, we will continue to monitor closely and adjust operations as needed to ensure the safe delivery of beauty essentials.”
Last month, Ulta announced a new long-term partnership with Target, establishing the launch of Ulta Beauty at Target, a shop-in-shop concept focused on offering established and emerging prestige brands online and in select target locations in the U.S.
Ulta Beauty at Target is set to debut at more than 100 Target locations starting in 2021, with plans to scale to hundreds more over time.
Looking forward, the retailer did not provide financial guidance for fiscal 2020, but did say that it expects to incur between between $180 million and $190 million in PPE and Covid-19 related operating costs, through the rest of the year.
It equally predicts that comparable store sales will decline in the range of 12 to 14 percent.
Despite the pandemic, during the third quarter of fiscal 2020, the company opened 17 stores. It ended the third quarter of fiscal 2020 with a total of 1,262 stores.
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