Ulta Beauty Inc (NASDAQ:ULTA) reported weaker-than-expected results for its second quarter and cut fiscal year 2019 earnings guidance.
The company, based in Bollingbrook, Ill., said net sales increased 12.0% to $1,666.6 million compared to $1,488.2 million in the second quarter of fiscal 2018.
Comparable sales (sales for stores open at least 14 months and e-commerce sales) increased 6.2% compared to an increase of 6.5% in the second quarter of fiscal 2018. The 6.2% comparable sales increase was driven by 5.4% transaction growth and 0.8% growth in average ticket.
Gross profit as a percentage of net sales increased 40 basis points to 36.4% compared to 36.0% in the second quarter of fiscal 2018, primarily due to improvement in merchandise margins driven by our marketing and merchandising strategies and leverage of fixed store costs, partially offset by investments in our salon services
Said CEO Mary Dillon, "The Ulta Beauty team delivered another quarter of solid top-line performance, gross margin expansion, and double-digit earnings growth.
"Looking forward, we have updated our fiscal 2019 outlook to reflect the headwinds we are currently seeing in the US cosmetics market. We remain confident that our guest-centric, differentiated business model will drive continued market share gains and strong returns for our shareholders over the long term.”
Net income increased 8.7% to $161.3 million compared to $148.3 million in the second quarter of fiscal 2018
Shares tumbled $86.32, or 25.6%, to $251.13
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