Q3 sales increased 18% to $199.5 million
Five Below, Inc. (NASDAQ:FIVE) today announced financial results
for the thirteen and thirty-nine weeks ended October 29, 2016.
For the thirteen weeks ended
October 29, 2016:
- Net sales increased by 17.6% to $199.5 million from $169.7
million in the third quarter of fiscal 2015; comparable sales
decreased by 0.2%.
- Operating income increased by 23.4% to $8.6 million from $7.0
million in the third quarter of fiscal 2015.
- The Company opened 26 new stores and ended the quarter with 517
stores in 31 states. This represents an increase in stores of 19.1%
from the end of the third quarter of fiscal 2015.
- Net income was $5.4 million compared to $4.3 million in the
third quarter of fiscal 2015.
- Diluted income per common share was $0.10 compared to $0.08 per
share in the third quarter of fiscal 2015.
“We are pleased to have delivered earnings at the high-end of
our guidance range in our fiscal third quarter,” stated Joel
Anderson, CEO of Five Below. “Our track record of outstanding
new store performance continued and, despite being up against a
strong third quarter last year, we delivered solid sales growth,
expanded operating margins and increased EPS by 25% for the
quarter.”
Mr. Anderson continued, “As we look to the all-important fourth
quarter, we believe we are well-positioned to wow our customers
with our compelling holiday assortment accompanied by exciting
marketing plans, including our new and expanded TV campaign. We are
pleased with the start to the holiday season and look forward to
delivering our customers a steady stream of amazing products at
exceptional values, reinforcing our position as a destination of
choice for their holiday gift-giving and stocking stuffer
needs.”
For the thirty-nine weeks ended
October 29, 2016:
- Net sales increased by 21.1% to $612.3 million from $505.6
million in the comparable period of fiscal 2015; comparable sales
increased by 2.6%.
- Operating income increased to $35.1 million from $25.6 million
in the comparable period of fiscal 2015.
- The Company opened 80 new stores compared to 68 net new stores
opened in the comparable period in fiscal 2015.
- Net income was $22.1 million compared to $15.7 million in the
comparable period of fiscal 2015.
- Diluted income per common share was $0.40 compared to $0.29 per
share in the comparable period of fiscal 2015.
Fourth Quarter and Fiscal 2016 Outlook:
For the fourth quarter of fiscal 2016, net sales are expected to
be in the range of $391 million to $397 million based on opening 5
net new stores and assuming a 2% to 3% increase in comparable
sales. Net income is expected to be in the range of $49.2 million
to $50.6 million, with a diluted income per common share range of
$0.89 to $0.92 on approximately 55.3 million estimated diluted
weighted average shares outstanding.
For fiscal 2016, net sales are expected to be in the range of
$1,003 million to $1,009 million based on opening 85 net new stores
for the full year and assuming a 2.3% to 2.7% increase in
comparable sales. Net income is expected to be in the range of
$71.3 million to $72.7 million, with a diluted income per common
share of $1.29 to $1.32 on approximately 55.3 million estimated
diluted weighted average shares outstanding.
Conference Call Information:
A conference call to discuss the third quarter fiscal 2016
financial results is scheduled for today, December 1, 2016, at 4:30
p.m. Eastern Time. Investors and analysts interested in
participating in the call are invited to dial 888-661-5176
(international callers please dial 913-312-1273) approximately 10
minutes prior to the start of the call. A live audio webcast of the
conference call will be available online at investor.fivebelow.com
in the investor relations section of the website.
A taped replay of the conference call will be available within
two hours of the conclusion of the call and can be accessed both
online and by dialing 877-870-5176 (international callers please
dial 858-384-5517). The pin number to access the telephone replay
is 3771037. The replay will be available until December 8,
2016.
Forward-Looking Statements:
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, the availability of
suitable new store locations and the dependence on the success of
shopping centers in which our stores are located, risks that
consumer spending may decline and that U.S. and global
macroeconomic conditions may worsen, risks related to the Company's
continued retention of its senior management and other key
personnel, risks related to changes in consumer preferences and
economic conditions, risks related to increased operating costs,
including wage rates, risks related to extreme weather, risks
related to the Company's distribution centers, quality or safety
concerns about the Company's merchandise, events that may affect
the Company's vendors, increased competition from other retailers
including online retailers, risks related to cyber security, risks
related to customers' payment methods, risks related to trade
restrictions, and risks associated with leasing substantial amounts
of space. For further details and a discussion of these risks and
uncertainties, see the Company's periodic reports, including the
annual report on Form 10-K, quarterly reports on Form 10-Q and
current reports on Form 8-K, filed with or furnished to the
Securities and Exchange Commission and available at www.sec.gov. If
one or more of these risks or uncertainties materialize, or if any
of the Company's assumptions prove incorrect, the Company's actual
results may vary in material respects from those projected in these
forward-looking statements. Any forward looking statement made by
the Company in this news release speaks only as of the date on
which the Company makes it. Factors or events that could cause the
Company's actual results to differ may emerge from time to time,
and it is not possible for the Company to predict all of them. The
Company undertakes no obligation to publicly update any forward
looking statement, whether as a result of new information, future
developments or otherwise, except as may be required by any
applicable securities laws.
About Five Below:
Five Below is a rapidly growing specialty value retailer
offering a broad range of trend-right, high-quality merchandise
targeted at the teen and pre-teen customer. Five Below offers a
dynamic, edited assortment of exciting products in a fun and
differentiated store environment, all priced at $5 and below.
Select brands and licensed merchandise fall into the Five Below
worlds: Style, Room, Sports, Tech, Crafts, Party, Candy, and Now.
Five Below was founded in 2002 and is headquartered in
Philadelphia, Pennsylvania, with over 500 stores in 31 states. For
more information, please visit www.fivebelow.com or come into
one of our stores!
FIVE BELOW, INC. |
Consolidated Balance Sheets |
(Unaudited) |
(in thousands) |
|
|
|
October 29, 2016 |
|
January 30, 2016 |
|
October 31, 2015 |
Assets |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
53,537 |
|
|
$ |
53,081 |
|
|
$ |
18,083 |
|
Short-term
investment securities |
|
9,912 |
|
|
46,335 |
|
|
— |
|
Inventories |
|
228,175 |
|
|
148,370 |
|
|
213,635 |
|
Prepaid
income taxes |
|
5,789 |
|
|
1,341 |
|
|
10,328 |
|
Prepaid
expenses and other current assets |
|
33,200 |
|
|
15,618 |
|
|
24,698 |
|
Total
current assets |
|
330,613 |
|
|
264,745 |
|
|
266,744 |
|
Property and equipment,
net |
|
135,939 |
|
|
119,784 |
|
|
119,974 |
|
Deferred income taxes |
|
9,045 |
|
|
8,507 |
|
|
10,349 |
|
Other assets |
|
1,312 |
|
|
258 |
|
|
318 |
|
|
|
$ |
476,909 |
|
|
$ |
393,294 |
|
|
$ |
397,385 |
|
|
|
|
|
|
|
|
Liabilities and Shareholders’ Equity |
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Line of
credit |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
Accounts
payable |
|
104,684 |
|
|
58,225 |
|
|
110,135 |
|
Income taxes
payable |
|
126 |
|
|
11,942 |
|
|
239 |
|
Accrued
salaries and wages |
|
8,677 |
|
|
7,661 |
|
|
6,170 |
|
Other
accrued expenses |
|
32,051 |
|
|
24,368 |
|
|
34,504 |
|
Total
current liabilities |
|
145,538 |
|
|
102,196 |
|
|
151,048 |
|
Deferred rent and
other |
|
53,220 |
|
|
46,617 |
|
|
46,850 |
|
Total
liabilities |
|
198,758 |
|
|
148,813 |
|
|
197,898 |
|
Shareholders’ equity: |
|
|
|
|
|
|
Common
stock |
|
549 |
|
|
546 |
|
|
545 |
|
Additional
paid-in capital |
|
318,137 |
|
|
306,522 |
|
|
303,533 |
|
Accumulated
deficit |
|
(40,535 |
) |
|
(62,587 |
) |
|
(104,591 |
) |
Total
shareholders’ equity |
|
278,151 |
|
|
244,481 |
|
|
199,487 |
|
|
|
$ |
476,909 |
|
|
$ |
393,294 |
|
|
$ |
397,385 |
|
FIVE BELOW, INC. |
Consolidated Statements of Operations |
(Unaudited) |
(in thousands, except share and per share data) |
|
|
|
Thirteen Weeks Ended |
|
Thirty-Nine Weeks Ended |
|
|
October 29, 2016 |
|
October 31, 2015 |
|
October 29, 2016 |
|
October 31, 2015 |
Net sales |
|
$ |
199,475 |
|
|
$ |
169,685 |
|
|
$ |
612,320 |
|
|
$ |
505,603 |
|
Cost of goods sold |
|
135,472 |
|
|
116,920 |
|
|
414,700 |
|
|
345,851 |
|
Gross
profit |
|
64,003 |
|
|
52,765 |
|
|
197,620 |
|
|
159,752 |
|
Selling, general and
administrative expenses |
|
55,372 |
|
|
45,768 |
|
|
162,523 |
|
|
134,177 |
|
Operating
income |
|
8,631 |
|
|
6,997 |
|
|
35,097 |
|
|
25,575 |
|
Interest income
(expense), net |
|
64 |
|
|
23 |
|
|
211 |
|
|
12 |
|
Other expense |
|
— |
|
|
— |
|
|
— |
|
|
325 |
|
Income
before income taxes |
|
8,695 |
|
|
7,020 |
|
|
35,308 |
|
|
25,262 |
|
Income tax expense |
|
3,248 |
|
|
2,683 |
|
|
13,256 |
|
|
9,586 |
|
Net income |
|
$ |
5,447 |
|
|
$ |
4,337 |
|
|
$ |
22,052 |
|
|
$ |
15,676 |
|
Basic income per common
share |
|
$ |
0.10 |
|
|
$ |
0.08 |
|
|
$ |
0.40 |
|
|
$ |
0.29 |
|
Diluted income per
common share |
|
$ |
0.10 |
|
|
$ |
0.08 |
|
|
$ |
0.40 |
|
|
$ |
0.29 |
|
Weighted average shares
outstanding: |
|
|
|
|
|
|
|
|
Basic
shares |
|
54,871,172 |
|
|
54,529,403 |
|
|
54,809,768 |
|
|
54,525,797 |
|
Diluted
shares |
|
55,170,686 |
|
|
54,833,252 |
|
|
55,100,534 |
|
|
54,811,978 |
|
FIVE BELOW, INC. |
Consolidated Statements of Cash Flows |
(Unaudited) |
(in thousands) |
|
|
|
Thirty-Nine Weeks Ended |
|
|
October 29, 2016 |
|
October 31, 2015 |
Operating
activities: |
|
|
|
|
Net
income |
|
$ |
22,052 |
|
|
$ |
15,676 |
|
Adjustments to reconcile net income to net cash used in operating
activities: |
|
|
|
|
Depreciation and amortization |
|
19,449 |
|
|
16,126 |
|
Share-based compensation expense |
|
9,014 |
|
|
8,400 |
|
Deferred
income tax benefit |
|
(538 |
) |
|
(2,468 |
) |
Other
non-cash expenses |
|
53 |
|
|
47 |
|
|
|
|
|
|
Changes
in operating assets and liabilities: |
|
|
|
|
Inventories |
|
(79,805 |
) |
|
(97,983 |
) |
Prepaid
income taxes |
|
(4,448 |
) |
|
(8,389 |
) |
Prepaid
expenses and other assets |
|
(18,656 |
) |
|
(6,572 |
) |
Accounts
payable |
|
47,240 |
|
|
64,971 |
|
Income
taxes payable |
|
(11,816 |
) |
|
(14,203 |
) |
Accrued
salaries and wages |
|
1,016 |
|
|
895 |
|
Deferred
rent |
|
7,623 |
|
|
6,916 |
|
Other
accrued expenses |
|
5,946 |
|
|
15,078 |
|
Net cash used in operating activities |
|
(2,870 |
) |
|
(1,506 |
) |
Investing
activities: |
|
|
|
|
Purchases
of investment securities |
|
(35,856 |
) |
|
— |
|
Sales,
maturities, and redemptions of investment securities |
|
72,279 |
|
|
— |
|
Capital
expenditures |
|
(35,714 |
) |
|
(44,749 |
) |
Net cash provided by (used in) investing activities |
|
709 |
|
|
(44,749 |
) |
Financing
activities: |
|
|
|
|
Net
proceeds from issuance of common stock |
|
93 |
|
|
81 |
|
Proceeds
from exercise of options to purchase common stock |
|
2,736 |
|
|
811 |
|
Common
shares withheld for taxes |
|
(1,819 |
) |
|
(322 |
) |
Excess
tax benefit related to exercises of stock options and vesting of
restricted stock units |
|
1,607 |
|
|
582 |
|
Net cash provided by financing activities |
|
2,617 |
|
|
1,152 |
|
Net increase (decrease) in cash and cash equivalents |
|
456 |
|
|
(45,103 |
) |
Cash and cash
equivalents at beginning of period |
|
53,081 |
|
|
63,186 |
|
Cash and cash
equivalents at end of period |
|
$ |
53,537 |
|
|
$ |
18,083 |
|
Investor Contact:
Five Below, Inc.
Christiane Pelz
215-207-2658
Christiane.Pelz@fivebelow.com
ICR, Inc.
Farah Soi/Caitlin Morahan
203-682-8200
Farah.Soi@icrinc.com/Caitlin.Morahan@icrinc.com
Media Contact:
ICR, Inc.
Jessica Liddell/Julia Young
203-682-8200
FivePR@icrinc.com
Five Below (NASDAQ:FIVE)
Historical Stock Chart
From Mar 2024 to Apr 2024
Five Below (NASDAQ:FIVE)
Historical Stock Chart
From Apr 2023 to Apr 2024