Ulta Beauty has been one of retail’s biggest recent success stories, opening nearly 500 stores in the U.S. over the past five years and boosting its stock price by almost 300% since June 2014. And while Ulta operates nearly 1,200 stores in the U.S. today, with a maximum goal of 1,700, the retailer is setting its sights on a new geography — Canada.
Ulta CEO Mary Dillon revealed the news in the retailer’s Q1 earnings report, indicating that the beauty retailer will operate as a global brand with Canada as its first non-U.S. market. However, the retailer revealed no details about when it will open its first Canadian store or how many it expects to build.
In the company’s Q1 earnings call, Dillon said that she wouldn’t share a lot of details about the expansion for “competitive reasons,” but noted that the company would “start small” before scaling up quickly. Dillon expects that the launch will put modest pressure on the profit and loss (P&L) statement for 2019, but even so, Ulta expects to maintain financial results within its present full-year guidance range.
Overall, the beauty retailer saw another positive quarter, thanks to the addition of 89 new stores over the past year:
- Net sales increased 12.9% to $1.74 billion;
- Comparable store sales increased 7.0%, driven by 4.3% transaction growth and 2.7% average ticket growth; and
- Net income increased 16.9%, from $164.4 million to $192.2 million.
Dillon highlighted that Ulta is gaining share across all major categories in both mass and prestige cosmetics, and called out prestige iconic brands, prestige skincare, professional haircare products and suncare as success stories.
For the most part, Ulta affirmed its major plans for fiscal 2019, when the retailer expects to:
- Open approximately 80 new stores, remodel or relocate 20 stores and “refresh” 270 stores;
- Increase total sales in the low double-digit percentage range; and
- Achieve comparable sales growth of approximately 6% to 7%, including e-Commerce growth of 20% to 30%.