Ulta Beauty suspends entry into Canada
Ulta Beauty is putting all its focus on its U.S. operations amid the pandemic.
The beauty giant revealed in an 8-K filing that it will postpone its long-planned launch in Canada. In 2019, Ulta announced its intent to expand internationally, starting in Canada. Most recently, in July, Ulta said it would open a number of stores in Canada in mid-2021.
“Ulta Beauty continues to believe international markets provide a long-term growth opportunity for the company,” the retailer stated in the filing. “However, given the current operating environment, the company has decided at this time to prioritize growth of its U.S. operations and is suspending its planned expansion to Canada.”
Ulta said it will focus on its investment opportunities to support continued profitable growth in the U.S., including expansion of its omnichannel capabilities, improvements to support the shopper experience, growth in key merchandising categories, increased loyalty and personalization efforts and new store openings.
Ulta’s investments in Canada to date have only been in “early-stage infrastructure” and leases on a small number of stores. The company expects to incur costs in the range of $55 million to $65 million as a result, most of which will be recognized in 2020.
Additionally, Ulta said it has repaid the outstanding borrowings under its revolving credit facility. As previously disclosed, on March 18, 2020, as a precautionary measure and to enhance financial flexibility, the company drew down $800 million under its revolving credit facility. On September 2, 2020, Ulta repaid the $800 million of borrowings that were outstanding under the facility.