Five Below Shares Surge Following Strong Earnings, Guidance

Shares of Five Below Inc FIVE jumped more than 7 percent in after-hours trading after the company reported better-than-expected results for the first quarter and raised its FY15 forecast. The Philadelphia, Pennsylvania-based company reported quarterly net income of $4.3 million, or $0.08 per share, versus $3.1 million, of $0.06 per share, in the year-ago quarter. Its adjusted net income rose to $0.08 per share from $0.07 per share. Its sales climbed 22 percent year-over-year to $153.7 million from $126 million. However, analysts were projecting a profit of $0.07 per share on revenue of $151.3 million. The average estimate among 15 Estimize users was for earnings of $0.07 per share and revenue of $153.13 million. Its comparable store sales climbed 1.7 percent in the quarter. Operating income surged to $7.0 million from $5.3 million. During the quarter, Five Below opened 19 new stores. The company ended the quarter with 385 stores in 23 states. As of May 2, 2015, the company had $52.4 million in cash and cash equivalents. Joel Anderson, CEO, said, "We are pleased with our first quarter results. Continued strength in new store performance drove the sales and earnings upside versus our guidance, reinforcing our excitement and confidence in the store growth potential for this brand. During the quarter we opened 19 new locations, including our entry into the new states of Kentucky and Alabama. In addition, we continued to invigorate our assortments with even more newness and are optimizing our marketing to better reach and engage our customers, including our new TV commercial that we are testing and that can be viewed on www.fivebelow.com/summerTV." Five Below projects Q2 earnings of $0.12 to $0.13 per share, on sales of $182 million to $185 million. Analysts had expected earnings of $0.12 per share on sales of $182 million. Five Below now expects FY15 earnings of $1.03 to $1.06 per share, on revenue of $820 million to $828 million. The company had earlier projected earnings of $1.02 to $1.05 per share, on revenue of $816 million to $824 million. Five Below shares surged 7.83 percent to $37.85 in the after-hours trading session.