Five Below Q2 earnings more than double; on track to open 170 - 175 stores this year
Five Below has opened 102 stores during the first half of the year, a record number for the fast-growing tween and teen value retailer.
The company opened 34 stores during its second quarter, bringing its total store count to 1,121 locations in 39 states.
"We now are on track to open 170 to 175 new stores this year and end fiscal 2021 with nearly 1,200 stores, leaving us a long runway ahead to reach the 2,500-plus total store potential we believe exists in the United States," Joel Anderson, Five Below CEO, told analysts on the company's earnings call. The retailer also expects to expects to complete about 30 remodels in its current fiscal year, he added.
Five Below reported that its net earnings totaled $64.8 million, or $1.15 a share, for the quarter ended July 31, up from $0.53 a share in the year-ago period. Analysts had forecast earnings of $1.11 a share.
Net sales increased 51.7% to $646.6 million last year, missing analysts’ estimates of $658 million. Same-store sales rose 39.2% compared to the year-ago quarter and 21% compared to the second quarter of 2019.
[Read More: Five Below opening 170 to 180 stores; expanding new, higher-priced in-store concept]
In a press release, Anderson stated that the third quarter is off to a "strong start from a sales perspective."
“We are innovating across our three key strategic priorities: product, experience and supply chain, where the teams are working diligently to mitigate the impact of global disruptions," he said. "We are confident that our Wow assortment, the flexibility of our unique model with eight worlds and our new Five Beyond offering, combined with the operating discipline of our teams across the organization, will continue to serve us well as we drive sustainable long-term growth and realize our 2,500-plus store potential in the U.S.”
For the third quarter, Five Below is expecting earnings of $0.23 to $0.30 share on sales of $550 million to $565 million. But citing the “uncertainty related to COVID-19, potential future shifts in consumer spending, and ongoing global supply chain disruption,” the company did not provide full-year sales or earnings guidance.