Ollie’s Bargain Outlet Holdings, Inc. (OLLI) has reported strong second-quarter earnings, exceeding revenue expectations and raising its guidance for the year. However, despite the positive results, shares are trading lower on Thursday.
The company reported adjusted earnings of 78 cents per share, which met analyst estimates. Revenue for the quarter came in at $578.38 million, a 12.4% increase from the prior year and surpassing the consensus estimate of $560.92 million.
Ollie’s Bargain Outlet saw a 5.8% increase in comparable store sales, compared to a 7.9% rise in the previous year. The company opened nine new stores during the quarter, bringing its total to 525 locations across 31 states, representing an 8.9% increase in store count year-over-year.
The company’s operating income rose by 15.6% to $60.8 million, with the operating margin improving by 30 basis points to 10.5%. Net income increased 16.1% to $49.0 million, or $0.79 per diluted share. Adjusted net income also grew by 15.6% to $48.2 million. Additionally, adjusted EBITDA surged 16.4% to $74.5 million, with the adjusted EBITDA margin rising by 50 basis points to 12.9%.
Inventories as of the end of the second quarter increased 6.6% to $531.3 million.
Looking ahead, Ollie’s Bargain Outlet has raised its fiscal year 2024 sales outlook from $2.257 billion – $2.277 billion to $2.276 billion – $2.291 billion, exceeding the estimated $2.273 billion. The company also updated its adjusted EPS outlook, increasing it from a range of $3.18 to $3.28 to a new range of $3.22 to $3.30, exceeding the estimated $3.28.
Despite the positive earnings report and raised guidance, OLLI shares are trading lower by 5.697% to $88.74 at last check on Thursday. The market’s reaction to the company’s strong performance may be attributed to a variety of factors, including broader market sentiment and investor expectations.
