Five Below, Inc. Announces Second Quarter Fiscal 2018 Financial Results
Q2 net sales increased 23% to
Q2 EPS increased 50% to
Raises full year fiscal 2018 guidance
For the thirteen weeks ended August 4, 2018:
- Net sales increased by 22.7% to
$347.7 millionfrom $283.3 millionin the second quarter of fiscal 2017; comparable sales increased by 2.7%.
- The Company opened 34 new stores and ended the quarter with 692 stores in 33 states. This represents an increase in stores of 18.5% from the end of the second quarter of fiscal 2017.
- Operating income increased by 15.7% to
$30.4 millionfrom $26.3 millionin the second quarter of fiscal 2017.
- Net income increased by 49.1% to
$25.1 millioncompared to $16.8 millionin the second quarter of fiscal 2017.
- Diluted income per common share was
$0.45compared to $0.30per share in the second quarter of fiscal 2017. Diluted income per common share included a $0.03benefit in the second quarter of fiscal 2018 due to the accounting for employee share-based payments.
Mr. Anderson continued, “With our increasing scale, digital marketing expansion and store densification strategy, our brand awareness is growing and we are seeing great opportunities for product, real estate and talent. We believe we are well positioned to continue to execute in the second half and look forward to continuing to provide our customers with the amazing, one-of-a kind shopping experience that is unique to
For the twenty-six weeks ended August 4, 2018:
- Net sales increased by 24.8% to
$644.1 millionfrom $516.2 millionin the comparable period of fiscal 2017; comparable sales increased by 3.0%.
- The Company opened 67 new stores compared to 62 new stores opened in the comparable period of fiscal 2017.
- Operating income increased by 41.1% to
$55.1 millionfrom $39.1 millionin the comparable period of fiscal 2017.
- Net income was
$46.9 millioncompared to $25.2 millionin the comparable period of fiscal 2017.
- Diluted income per common share was
$0.84compared to $0.45per share in the comparable period of fiscal 2017. Diluted income per common share included a $0.07benefit in the twenty-six weeks ended August 4, 2018 due to the accounting for employee share-based payments.
- Financial results for the thirteen and twenty-six weeks ended August 4, 2018 include the thirteen and twenty-six weeks ended August 4, 2018, as compared to the thirteen and twenty-six weeks ended
July 29, 2017.
- Comparable sales are reported using the
National Retail Federation'srestated calendar comparing similar weeks, which are the thirteen and twenty-six weeks ended August 4, 2018 as compared to the thirteen and twenty-six weeks ended August 5, 2017.
Third Quarter and Fiscal 2018 Outlook:
For the third quarter of fiscal 2018, net sales are expected to be in the range of
For the full year of fiscal 2018, net sales are expected to be in the range of
Conference Call Information:
A conference call to discuss the second quarter fiscal 2018 financial results is scheduled for today,
This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as contained in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which reflect management's current views and estimates regarding the Company's industry, business strategy, goals and expectations concerning its market position, future operations, margins, profitability, capital expenditures, liquidity and capital resources and other financial and operating information. Investors can identify these statements by the fact that they use words such as "anticipate," "assume," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "future" and similar terms and phrases. The Company cannot assure investors that future developments affecting the Company will be those that it has anticipated. Actual results may differ materially from these expectations due to risks related to the Company's strategy and expansion plans, risks related to the inability to successfully implement our expansion into online retail, risks related to our ability to select, obtain, distribute and market merchandise profitably, risks related to our reliance on merchandise manufactured outside of
Vice President, Investor Relations
Consolidated Balance Sheets
|August 4, 2018||February 3, 2018||July 29, 2017|
|Cash and cash equivalents||$||133,256||$||112,669||$||74,759|
|Short-term investment securities||131,441||131,958||92,721|
|Prepaid income taxes||7,358||2,264||3,698|
|Prepaid expenses and other current assets||50,210||45,434||34,876|
|Total current assets||550,374||479,362||390,571|
|Property and equipment, net||214,923||180,349||159,717|
|Deferred income taxes||3,949||6,676||9,653|
|Long-term investment securities||1,404||27,702||—|
|Liabilities and Shareholders’ Equity|
|Line of credit||$||—||$||—||$||—|
|Income taxes payable||407||25,275||3,271|
|Accrued salaries and wages||13,509||22,906||8,550|
|Other accrued expenses||66,933||43,246||44,772|
|Total current liabilities||184,740||164,460||133,473|
|Deferred rent and other||79,639||72,690||61,591|
|Additional paid-in capital||348,344||346,300||331,515|
|Total shareholders’ equity||507,958||458,558||366,515|
Consolidated Statements of Operations
(in thousands, except share and per share data)
|Thirteen Weeks Ended||Twenty-Six Weeks Ended|
|August 4, 2018||July 29, 2017||August 4, 2018||July 29, 2017|
|Cost of goods sold||225,982||184,814||425,066||343,909|
|Selling, general and administrative expenses||91,330||72,205||163,862||133,209|
|Interest income, net||983||259||2,062||568|
|Income before income taxes||31,405||26,560||57,190||39,651|
|Income tax expense||6,342||9,756||10,323||14,456|
|Basic income per common share||$||0.45||$||0.30||$||0.84||$||0.46|
|Diluted income per common share||$||0.45||$||0.30||$||0.84||$||0.45|
|Weighted average shares outstanding:|
Consolidated Statements of Cash Flows
|Twenty-Six Weeks Ended|
|August 4, 2018||July 29, 2017|
|Adjustments to reconcile net income to net cash provided by operating activities:|
|Depreciation and amortization||19,367||15,479|
|Share-based compensation expense||6,157||7,992|
|Deferred income tax expense||2,727||1,386|
|Other non-cash expenses||43||66|
|Changes in operating assets and liabilities:|
|Prepaid income taxes||(5,094)||(2,146)|
|Prepaid expenses and other assets||(4,844)||(5,826)|
|Income taxes payable||(24,868)||(20,668)|
|Accrued salaries and wages||(9,397)||(2,244)|
|Other accrued expenses||12,066||10,107|
|Net cash provided by operating activities||44,389||31,102|
|Purchases of investment securities||(59,569)||(72,804)|
|Sales, maturities, and redemptions of investment securities||86,384||68,387|
|Net cash used in investing activities||(19,707)||(34,366)|
|Net proceeds from issuance of common stock||168||135|
|Proceeds from exercise of options to purchase common stock and vesting of restricted and performance-based restricted stock units||3,367||2,845|
|Common shares withheld for taxes||(7,630)||(1,045)|
|Net cash (used in) provided by financing activities||(4,095)||1,935|
|Net increase (decrease) in cash and cash equivalents||20,587||(1,329)|
|Cash and cash equivalents at beginning of period||112,669||76,088|
|Cash and cash equivalents at end of period||$||133,256||$||74,759|
Source: Five Below, Inc.