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Ulta Beauty Hosts Analyst and Investor Conference, Updates Third Quarter and Fiscal Year 2018 Guidance, and Issues Long-Term Outlook

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Ulta Beauty, Inc. (NASDAQ:ULTA) will host its 2018 analyst and investor
conference today, Thursday, November 8, 2018 from 10:00 a.m. to
3:00 p.m. Central Time in Itasca, Illinois. In conjunction with this
event, the Company is updating its financial guidance for the third
quarter and fiscal 2018, issuing three year sales growth and earnings
per share targets, and providing an update on its long-term strategy.

"We look forward to sharing our future vision for Ulta Beauty with the
investment community," said Mary Dillon, Chief Executive Officer. "We
see exciting possibilities ahead to continue to increase market share,
profitability and long-term shareholder value through our renewed
strategic plan. This plan reflects deep guest and category insights that
have led to robust innovation around guest experience, new capabilities
in personalization and digital experiences, and laser focus on
operational efficiencies."

Announcing Q3 2018 Comparable Sales and Updating Q3 2018 and Fiscal
2018 Outlook:

For the third quarter of fiscal 2018, the Company achieved comparable
sales growth, including e-commerce, of 7.8%, primarily driven by
transaction growth, compared to guidance of 7% to 8% issued on
August 30, 2018. Retail comparable sales growth was 4.4%, including
salon comparable sales growth of 3.3%. E-commerce sales grew 42.2%. The
Company reported a comparable sales increase of 10.3% in the third
quarter of fiscal 2017.

The Company expects to report diluted earnings per share for the third
quarter of fiscal 2018 at the high end of the range of the Company's
prior guidance of $2.11 to $2.16. The Company reported diluted earnings
per share for the third quarter of fiscal 2017 of $1.70.

The Company is updating its previously announced fiscal 2018 guidance
for comparable sales. For the full year, the Company expects to achieve
comparable sales growth of approximately 7% to 8%, compared to previous
guidance of 6% to 8%. The Company expects to deliver diluted earnings
per share growth for fiscal 2018 in the low twenties percentage range,
confirming its previous guidance.

Ulta Beauty is issuing comparable sales and diluted earnings per share
targets for fiscal 2019, 2020 and 2021. The Company expects to achieve
comparable sales growth in the range of 5% to 7%, and grow diluted
earnings per share in the mid to high teens percentage range.

The Company expects to achieve modest operating margin expansion
each year, balancing new investments in supply chain, digital
innovation, and the guest experience with savings from a comprehensive
cost optimization program, Efficiencies for Growth. The Company is
announcing a multi-year $150 to $200 million cost savings target to fund
investments in future growth initiatives.

Conference Highlights:

The Company will describe its updated strategic imperatives that support
the Company's vision to be the most loved beauty destination of its
guests and the most admired retailer by Ulta Beauty associates,
communities, partners and investors, as it continues to increase market
share, profitability and long-term shareholder value:

  1. Drive growth across beauty enthusiast segments
  2. Deepen Ulta Beauty love and loyalty
  3. Deliver a one of a kind, world class beauty assortment
  4. Lead the in-store and beauty services experience
  5. Reinvent beauty digital engagement
  6. Deliver operational excellence and drive efficiencies

Highlights of the presentations will include:

  • Unveiling of the Company's brand purpose, "We bring possibilities to
    life through the power of beauty", supported by a new advertising
    campaign, and targeted programs to drive growth with key demographic
    segments and create a more compelling, emotional connection with Ulta
    Beauty guests;
  • Sharing plans to unlock the potential to grow share of wallet with
    increased personalization of the Ultamate Rewards loyalty program,
    with member sales now representing more than 95% of total Company
    sales;
  • Announcing actions to build a digital innovation ecosystem, supported
    by investments in digital workflow partner Iterate and online booking
    tool partner Spruce, and recent acquisitions of QM Scientific and
    GlamST, technology startups in artificial intelligence and augmented
    reality, which together support the Company's personalization
    initiatives and accelerate its digital innovation capabilities;
  • Positioning Ulta Beauty as the partner of choice for brands across the
    spectrum, from classic prestige to digitally native brands, with
    opportunities to drive growth across all product categories
    encompassing more than 25,000 SKUs;
  • Announcing the November 17, 2018 launch date of Kylie Cosmetics in
    stores and on-line;
  • Enhancing store productivity through the reinvention of the guest
    experience, including revamping the services offering through the
    Services Optimization program, rolling out omni-channel capabilities
    and investing in store labor and productivity tools;
  • Updating the store maturation model and store cost model and refining
    the US store target to 1,500 to 1,700 stores. Announcing plans to open
    80 stores in 2019, 75 stores in 2020 and 70 stores in 2021, in concert
    with a stronger focus on optimizing the store portfolio;
  • Announcing a new target for e-commerce fulfillment of two day delivery
    by 2021, supported by the opening of a Fast Fulfillment Center in 2019
    serving e-commerce only orders, and implementing ship-from-store
    capability in select stores. Committing to working capital
    improvements with the goal of increasing inventory turns by 50 basis
    points over the next five years.

Webcast Information

Today's analyst and investor conference will be webcast live on
November 8, 2018, from 11:00 a.m. Eastern Time to 1:00 p.m. Eastern Time
and from 2:00 p.m. Eastern Time to 4:00 p.m. Eastern Time at http://ir.ultabeauty.com
and will be archived for one year.

About Ulta Beauty

At Ulta Beauty (NASDAQ:ULTA), the possibilities are beautiful. Ulta
Beauty is the largest U.S. beauty retailer and the premier beauty
destination for cosmetics, fragrance, skin care products, hair care
products and salon services. In 1990, the Company reinvented the beauty
retail experience by offering a new way to shop for beauty – bringing
together all things beauty, all in one place. Today, Ulta Beauty has
grown to become the top national retailer offering the complete beauty
experience.

Ulta Beauty brings possibilities to life through the power of beauty
each and every day in our stores and online with more than 25,000
products from approximately 500 well-established and emerging beauty
brands across all categories and price points, including Ulta Beauty's
own private label. Ulta Beauty also offers a full-service salon in every
store featuring hair, skin, brow, and make-up services.

Ulta Beauty is recognized for its commitment to personalized service,
fun and inviting stores and our industry-leading Ultamate Rewards
loyalty program. As of November 3, 2018, Ulta Beauty operates 1,163
retail stores across 50 states and also distributes its products through
its website. For more information, visit www.ulta.com.

Forward-Looking Statements

This press release contains forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934, as
amended, and the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, which reflect our current views with
respect to, among other things, future events and financial performance.
You can identify these forward-looking statements by the use of
forward-looking words such as "outlook," "believes," "expects," "plans,"
"estimates," "targets," "strategies" or other comparable words. Any
forward-looking statements contained in this press release are based
upon our historical performance and on current plans, estimates and
expectations. The inclusion of this forward-looking information should
not be regarded as a representation by us or any other person that the
future plans, estimates, targets, strategies or expectations
contemplated by us will be achieved. Such forward-looking statements are
subject to various risks and uncertainties, which include, without
limitation: changes in the overall level of consumer spending and
volatility in the economy; the possibility that we may be unable to
compete effectively in our highly competitive markets; the possibility
that cybersecurity breaches and other disruptions could compromise our
information or result in the unauthorized disclosure of confidential
information; our ability to gauge beauty trends and react to changing
consumer preferences in a timely manner; our ability to attract and
retain key executive personnel; the possibility that the capacity of our
distribution and order fulfillment infrastructure and the performance of
our newly opened and to be opened distribution centers may not be
adequate to support our recent growth and expected future growth plans;
our ability to sustain our growth plans and successfully implement our
long-range strategic and financial plan; the possibility of material
disruptions to our information systems; changes in the wholesale cost of
our products; the possibility that new store openings and existing
locations may be impacted by developer or co-tenant issues; natural
disasters that could negatively impact sales; our ability to
successfully execute our common stock repurchase program or implement
future common stock repurchase programs; our ability to execute the
Efficiencies for Growth cost optimization program; and other risk
factors detailed in our public filings with the Securities and Exchange
Commission (the "SEC"), including risk factors contained in our Annual
Report on Form 10-K for the fiscal year ended February 3, 2018, as such
may be amended or supplemented in our subsequently filed Quarterly
Reports on Form 10-Q. Our filings with the SEC are available at
www.sec.gov.
Except to the extent required by the federal securities laws, the
Company does not undertake to publicly update or revise its
forward-looking statements, whether as a result of new information,
future events or otherwise.

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