Ulta Beauty, Inc. reported its financial results for the second quarter and first half of fiscal 2024, ending August 3, 2024. The company achieved net sales of $2,552.1 million for the 13 weeks, reflecting a modest increase of $22.3 million (0.9%) compared to $2,529.8 million for the same period in the previous year. For the 26 weeks, net sales rose to $5,277.9 million, up $113.9 million (2.2%) from $5,164.1 million in the prior year.
Despite the revenue growth, profitability metrics showed a decline. Operating income for the second quarter decreased to $329.2 million, down from $391.6 million year-over-year, while for the first half, it fell to $730.1 million from $833.7 million. Net income for the quarter was $252.6 million, a decrease from $300.1 million in the same quarter last year. For the first half, net income dropped to $565.7 million from $647.2 million. This decline in profitability was attributed to increased selling, general, and administrative (SG&A) expenses, which rose by 7.3% to $644.8 million for the quarter and by 8.1% to $1.3 billion for the half-year.
The gross profit for the second quarter was $978.2 million, down from $993.6 million, resulting in a gross profit margin of 38.3%, compared to 39.3% in the prior year. The company also reported a decrease in comparable sales by 1.2% for the quarter, driven by a 1.8% decline in transactions, although the average ticket increased by 0.6%.
Ulta Beauty's cash and cash equivalents stood at $414.0 million as of August 3, 2024, an increase from $388.6 million a year earlier. However, net cash provided by operating activities decreased to $358.9 million from $428.8 million, primarily due to timing issues with accounts payable and increased merchandise inventories, which rose by 10.1% to $2.0 billion.
The company opened 29 new stores during the first half of fiscal 2024, compared to eight in the same period last year, while also closing three stores. The strategic focus remains on expanding its omnichannel capabilities and enhancing customer experiences.
In March 2024, Ulta Beauty authorized a new share repurchase program allowing for the repurchase of up to $2.0 billion of its common stock, revoking the previous program. The company reported no borrowings under its credit facility as of the reporting date, indicating strong financial management and compliance with loan covenants.
About Ulta Beauty, Inc.
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