Ollie’s Bargain Outlet to open 45 new stores n 2023; deal pipeline ‘strong’

Ollie’s Bargain Outlet Holdings reported a 9.7% rise in fourth-quarter sales and said its long-term expansion plans remain on track.

The closeout retailer, which ended the year with 468 stores, will open 45 new locations in 2023. With a goal of more than 1,000 stores, Ollie’s had previously committed to opening 50 to 55 locations annually. On the company earnings call, executives cited said that lead times for permitting and construction were slowing openings.

“However, we remain confident in our ability to open at least 1,050 stores and plan on returning to our normal store opening cadence for fiscal 2024,” COO Eric van der Valkvan der Valk told analysts.

In 2023, Ollie’s will also start construction of its fourth distribution center and expand its existing center in York, Penn.  Located in Princeton, Ill., the new distribution center is expected to open in the center quarter of fiscal 2024.

For its fourth quarter, ended Jan. 28, Ollie’s total net sales increased 9.7% to $549.8 million.  Comparable store sales increased 3.0% from the prior year decrease of 10.5%.

Net income totaled $53.1 million, or $0.85 per diluted share, up from $44.7 million, or $0.71 per diluted share, in the prior year.

For the full year, Ollie’s total net sales increased 4.2% to $1.827 billion. Comparable store sales decreased 3.0% from the prior year decrease of 11.1%.

“Our team executed well in a highly promotional environment and delivered a 110-basis point increase in gross margin compared to last year,” said John Swygert, president and CEO. “For 2023, we are focused on offering great deals, expanding operating margins, and growing our store base, all of which will position us to deliver consistent, long-term growth for our shareholders. Our deal pipeline is strong, and we are excited about the opportunities ahead of us.”

Ollie’s cash and cash equivalents and short-term investments were $270.8 million as of the end of fiscal 2022 compared with cash and cash equivalents of $247.0 million as of the end of fiscal 2021. The company had no borrowings outstanding under its $100 million revolving credit facility and $87.0 million of availability under the facility as of the end of fiscal 2022.

Ollie’s Bargain Outlet was founded in 1982. It offers an extensive variety of heavily discounted brand-name merchandise across departments that include food, books, housewares, toys, electronics, domestics, clothing, furniture, health and beauty, flooring and seasonal items.