Summary
Burlington Stores, Inc. reported a strong performance for the second quarter and first half of fiscal year 2016, demonstrating significant year-over-year growth in both revenue and net income. The company saw a notable increase in net sales, driven by a solid comparable store sales increase of 5.4% in Q2 and 4.9% for the first half. Gross margins improved due to higher initial markups, which helped to offset increased product sourcing costs. Selling, general, and administrative expenses were managed effectively, showing leverage as a percentage of net sales. The company also successfully repriced its senior secured term loan facility, reducing interest rate margins and improving its debt structure. Operationally, Burlington Stores is executing well on its strategy to enhance the off-price model, sharpen focus on its core female customer, and improve the customer experience. The company continues to invest in opening new stores, with plans for approximately 25 net new Burlington Stores in fiscal year 2016, demonstrating a commitment to physical expansion. Inventory levels were well-managed, showing a decrease compared to the prior year, contributing to improved inventory turnover. Overall, the financial results reflect positive momentum and effective strategic execution.
Financial Highlights
48 data points| Revenue | $1.26B |
| Cost of Revenue | $757.62M |
| Gross Profit | $497.43M |
| SG&A Expenses | $407.10M |
| Operating Expenses | $1.23B |
| Net Income | $20.39M |
| EPS (Basic) | $0.29 |
| EPS (Diluted) | $0.28 |
| Shares Outstanding (Basic) | 70.76M |
| Shares Outstanding (Diluted) | 71.99M |
Key Highlights
- 1Net sales increased by 9.7% to $1.26 billion for the three months ended July 30, 2016, and by 9.0% to $2.54 billion for the six months ended July 30, 2016.
- 2Comparable store sales increased by 5.4% for the three months and 4.9% for the six months ended July 30, 2016.
- 3Gross margin as a percentage of net sales improved to 39.6% in Q2 FY2016 and 39.9% in H1 FY2016, indicating better initial markups.
- 4Selling, general, and administrative expenses as a percentage of net sales improved, demonstrating operating leverage.
- 5Net income increased significantly to $20.4 million for the three months and $57.9 million for the six months ended July 30, 2016, compared to the prior year periods.
- 6The company repriced its senior secured term loan facility, reducing interest rate margins and incurring a $3.8 million non-cash loss on extinguishment of debt.
- 7Burlington Stores plans to open approximately 25 net new stores in Fiscal Year 2016, indicating continued expansion.