Expansion drives up Ulta 3Q sales 22 percent

BOLINGBROOK - Ulta Beauty said sales at its stores increased 22 percent in the third quarter of 2015 as the company continued to expand.

Merchandise inventories for the quarter totaled $884.4 million, up $174.7 million from $709.7 million during the same period in 2014. Average inventory per store increased 10.9 percent in the quarter, which was primarily driven by the opening of a distribution center in Greenwood, Indiana, as well as investments in inventory to ensure high in-stock levels to support sales growth and incremental inventory for new brands and in-store prestige brand boutiques.

"Delivering against our six strategic imperatives continues to drive our business forward," said Ulta CEO Mary Dillon. "We believe our efforts to build awareness of the Ulta Beauty brand are bringing more guests to discover our differentiated assortment and the benefits of our loyalty program, now boasting 17 million active members.

Ulta opened 45 new stores during the quarter, while closing two, and ended the third quarter with 860 stores and square footage of 9,080,084, representing a 12 percent increase in square footage compared to the third quarter of fiscal 2014.

The company expects net sales in the fourth quarter of 2015 to be in the range of $1.21 billion to $1.23 billion, compared to actual net sales of $1 billion in the fourth quarter of fiscal 2014. Comparable sales for the fourth quarter, including e-commerce sales, are expected to increase 8 percent to 10 percent.

"As a result of our financial performance in the third quarter and our position of strength heading into the holiday season, we are raising our guidance and now expect our 2015 full year earnings growth rate to be in the low twenties," Dillon said.