Burlington Stores Stock Gains Post Q3 Results; Hopes On Recovery Next Year

  • Burlington Stores Inc BURL reported a third-quarter FY22 sales decline of 11% year-on-year to $2.04 billion, missing the consensus of $2.06 billion.
  • Comparable store sales decreased 17% versus last year.
  • Gross margin contracted by 20 basis points to 41.2%. Total costs and expenses fell 11.2% Y/Y to $2 billion.
  • Adjusted EBITDA decreased 40% to $123 million, while the margin contracted 290 basis points.
  • Adjusted EPS of $0.43 missed the analyst consensus of $0.52.
  • The company held $435.2 million in cash and equivalents as of October 29, 2022.
  • Merchandise inventories at the end of Q3 increased 36% to $1.44 billion.
  • Outlook: Burlington sees Q4 adjusted EPS of $2.45 - $2.75 against the consensus of $2.61. Comparable store sales to decrease 9% - 6%.
  • It narrowed the FY22 adjusted EPS forecast to $3.77 - $4.07 (prior view $3.70 - $4.30) versus the consensus of $4.00.
  • BURL expects FY22 comparable store sales to decrease 15% - 14% (prior view down 15% - 13%).
  • CEO Michael O'Sullivan said, "While we acknowledge that there are risks and uncertainties, we think the outlook for 2023 is very positive. We anticipate that the economic and competitive environment could set up very well for off-price.... Based on these factors we believe that we can start to drive significant sales, margin, and earnings recovery next year."
  • Also ReadBurlington Industries Declares Bankruptcy On This Day In Market History
  • Price Action: BURL shares are trading higher by 14% at $169.43 on the last check Tuesday.
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