01—Abstract
Summary
Summary of the 10-Q filed May 30, 2024. Cited figures are marked; the original filing is the authoritative source.
Burlington Stores, Inc. reported strong first-quarter results for fiscal year 2024, demonstrating significant year-over-year growth in both revenue and profitability.
Net sales increased by 10.5% to $2.36 billiona, driven by a 2% rise in comparable store sales and contributions from new store openings. This top-line growth, coupled with improved gross margin and controlled SG&A expenses, led to a substantial increase in net income to $78.5 million, or $1.22 per diluted share, up from $32.7 million, or $0.50 per diluted share, in the prior year. The company continues its strategic expansion, opening 36 new stores (including 11 relocations) in the quarter, and plans to average approximately 100 net new stores per year through fiscal 2028, reinforcing its long-term growth strategy.
Burlington's focus on operational efficiency, including leaner inventories and optimized supply chain, is contributing to enhanced profitability. The company also highlighted its robust liquidity position, with significant availability under its ABL Line of Credit and positive cash flow from operations, positioning it well to fund future growth and capital expenditures.
02—Key points
Key Highlights
- Net sales for the quarter increased by 10.5% to $2.36 billion, compared to $2.13 billion in the prior year's first quarter.
- Comparable store sales saw a 2% increase, indicating healthy performance in existing store locations.
- Net income surged to $78.5 million ($1.22 per diluted share) from $32.7 million ($0.50 per diluted share) year-over-year.
- Gross margin improved to 43.5% from 42.3% in the prior year, driven by better merchandise margins and reduced freight costs.
- The company opened 36 new stores (including 11 relocations) and plans to average approximately 100 net new stores annually through fiscal 2028.
- Inventory levels decreased year-over-year to $1.14 billion from $1.23 billion, reflecting a more efficient inventory management strategy.
- The company maintained strong liquidity, ending the quarter with $742.3 million in cash and cash equivalents and $779.1 million available under its ABL Line of Credit.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2025filed May 30, 2024Financial Statements
Q1 FY2025 against Q1 FY2024
| Line item | Q1 FY2025Q1 FY2024 | Change |
|---|---|---|
| Revenue | $2.36B$2.14B | +10.5% |
| Cost of Revenue | $1.33B$1.23B | +8.0% |
| Gross Profit | $1.03B$905.31M | +13.9% |
| SG&A Expenses | $825.23M$755.63M | +9.2% |
| Operating Expenses | $2.25B$2.09B | +7.6% |
| Net Income | $78.51M$32.75M | +139.8% |
| EPS (Basic) | $1.23$0.50 | +146.0% |
| EPS (Diluted) | $1.22$0.50 | +144.0% |
| Shares Outstanding (Basic) | 63.87M64.95M | −1.7% |
| Shares Outstanding (Diluted) | 64.27M65.29M | −1.6% |
05—Questions
Frequently Asked Questions
What were the primary drivers of Burlington's revenue growth in the first quarter?
Burlington's revenue growth was primarily driven by a 10.5% increase in net sales to $2.36 billion. This was fueled by a 2% rise in comparable store sales, indicating improved performance in existing locations, and the net sales generated from 88 new stores opened since the prior year's first quarter. The company's strategy of opportunistic buying and expanding its store base continues to contribute to top-line growth.
How has Burlington's profitability improved compared to the previous year?
Profitability significantly improved in the first quarter, with net income rising to $78.5 million from $32.7 million in the prior year's first quarter. This improvement is attributed to a higher gross margin rate (43.5% vs. 42.3%), driven by better merchandise margins and lower freight costs. Additionally, Selling, General, and Administrative (SG&A) expenses as a percentage of net sales decreased to 35.0% from 35.4%, benefiting from supply chain efficiencies and improved product sourcing costs.
What is Burlington's strategy for store expansion, and what are the future plans?
Burlington continues to execute a disciplined real estate strategy focused on market opportunities. In the first quarter, the company opened 36 new stores (including 11 relocations) and closed 11 stores, bringing the total store count to 1,021. Looking ahead, Burlington plans to open approximately 100 net new stores per year on average through fiscal 2028, aiming to reach around 2,000 stores long-term, leveraging its smaller store prototype.
How is Burlington managing its inventory and what is the current inventory position?
Burlington is focusing on operating with leaner inventories, which they believe will result in a higher mix of fresh receipts and better merchandise values for customers, leading to faster turns and lower markdowns. As of May 4, 2024, merchandise inventories stood at $1.14 billion, a decrease from $1.23 billion at April 29, 2023. This reduction, despite the opening of new stores, reflects their commitment to more efficient inventory management.
06—Continue