Burlington Stores posts 58 percent rise in Q1 net income

Burlington Stores, Inc. announcing its first quarter results for the thirteen weeks ended May 5, 2018, said that total sales increased 12.8 percent to 1,518 million dollars. New and non-comparable stores contributed an incremental 82 million dollars in sales during the quarter. Accounting for the calendar shift from the 53rdweek in fiscal 2017, comparable store sales increased 4.8 percent. Net income increased 58 percent over the prior year period to 83 million dollars or 1.20 dollars per share vs. 0.73 dollar last year, and adjusted net income increased 54 percent to 87 million dollars or 1.26 dollars per share, vs. 0.79 dollar last year.

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Commenting on the first quarter trading, Tom Kingsbury, the company’s CEO, said in a media release: “We are very pleased to kick off fiscal 2018 with strong first quarter results, driven by a 4.8 percent comparable store sales increase. Our overall 12.8 percent sales growth, along with our 70 basis point adjusted EBITDA margin improvement, enabled the company to drive a 59 percent increase in adjusted EPS in the first quarter, well ahead of our guidance.”

Burlington Stores’ first quarter operating results

Gross margin expanded by approximately 35 basis points over last year’s levels to 41.2 percent driven primarily by increased merchandise margin, which was slightly offset by higher freight costs.

Adjusted EBITDA increased 21percent or 28 million dollars above the prior year period, to 165 million dollars. The 70 basis point expansion in adjusted EBITDA as a percentage of sales was, the company said, primarily driven by expense leverage and gross margin expansion. Adjusted EBIT increased 26 percent or 25 million dollars above the prior year period to 120 million dollars.

Full year sales expected to rise 9.7 to 10.5 percent

For the full fiscal year 2018, the company now expects total sales to increase in the range of 9.7 percent to 10.5 percent, excluding the 53rd week impact in 2017; this assumes shifted comparable store sales to increase in the range of 2 percent to 3 percent for the balance of fiscal 2018, resulting in a full year shifted comparable store sales increase of 2.6 percent to 3.4 percent on top of the 3.4 percent increase during fiscal 2017; adjusted EBITDA margin to increase 30 to 40 basis points; and adjusted EBIT margin to increase 20 to 30 basis points. The company plans to open 35 to 40 net new stores during the year.

Adjusted EPS is anticipated to be in the range of 5.90 dollars to 6 dollars, utilizing a fully diluted share count of approximately 68.9 million. This guidance compares to the previous outlook for adjusted EPS of 5.73 dollars-5.83 dollars; and adjusted EPS, excluding the estimated impact of 2017 Tax Reform and the accounting for stock based compensation, to be in the range of 4.82 dollars to 4.92 dollars as compared with the comparable 52 week adjusted EPS of 4.14 dollars in fiscal 2017. This represents growth of 16 percent to 19 percent.

For the second quarter of fiscal 2018, the company expects total sales to increase in the range of 8 percent to 9 percent; shifted comparable store sales for the 13 weeks ended August 4, 2018 compared to the 13 weeks ended August 5, 2017 to increase in the range of 2 percent to 3 percent and adjusted EPS in the range of 0.91 dollar to 0.95 dollar, which assumes a fully diluted share count of approximately 68.8 million shares, as compared to 0.72 dollar last year.

picture:Facebook/Burlington