Ollie's Bargain Outlet (OLLI) - 2026 Q2 - Quarterly Results

Second Quarter Fiscal 2025 Results Overview Ollie's Bargain Outlet Holdings, Inc. reported strong Q2 FY2025 results, exceeding sales and earnings expectations, and raising its full-year outlook, driven by improved execution and positive consumer response Executive Summary & CEO Commentary Ollie's Bargain Outlet Holdings, Inc. reported strong Q2 FY2025 results, exceeding sales and earnings, and raising its full-year outlook, driven by improved execution and positive consumer response - The company reported strong Q2 FY2025 performance, with new store openings, total sales, comparable store sales, and profitability all exceeding expectations, leading to an upward revision of the full-year outlook[1][3] - CEO Eric van der Valk stated that improved internal planning, coordination, and execution elevated business performance, with positive consumer response to the merchandise mix, especially in consumables and seasonal categories, and notable growth in Ollie's Army membership[3] Key Financial Metrics for Q2 Fiscal 2025 (Year-over-Year Change) | Metric | Thirteen Weeks Ended August 2, 2025 (in thousands) | Thirteen Weeks Ended August 3, 2024 (in thousands) | Year-over-Year Change | | :-------------------------------- | :------------------- | :------------------- | :------- | | Net Sales | $679,556 | $578,375 | 17.5% | | Comparable Store Sales Change | 5.0% | 5.8% | -0.8% | | Net Income | $61,310 | $48,982 | 25.2% | | Diluted Net Income Per Share | $0.99 | $0.79 | 25.3% | | Adjusted Diluted Net Income Per Share | $0.99 | $0.78 | 26.9% | | Adjusted EBITDA | $93,786 | $74,450 | 26.0% | | Adjusted EBITDA as a Percentage of Net Sales | 13.8% | 12.9% | +0.9% | | New Store Openings | 29 | 9 | +20 | | Store Count Year-over-Year Growth | 16.8% | 8.9% | +7.9% | Second Quarter Fiscal 2025 Key Highlights Q2 FY2025 saw significant store expansion, loyalty member growth, and increased net and comparable store sales, with improved gross margin offset by higher SG&A and pre-opening expenses - 29 new stores opened, bringing the total to 613 stores across 34 states by quarter-end, representing 16.8% year-over-year growth[4] - Ollie's Army loyalty membership grew by 10.6% to 16.1 million members[4] - Net sales increased by 17.5% to $679.6 million, driven primarily by new store growth and higher comparable store sales[4] - Comparable store sales grew by 5.0%, primarily driven by increased transaction volume[4] - Gross margin improved by 200 basis points to 39.9%, mainly due to lower supply chain costs and higher merchandise margins[4] - Selling, General, and Administrative (SG&A) expenses as a percentage of net sales increased by 60 basis points to 25.8%, primarily due to higher medical and casualty claims and a slight increase in store labor expenses[4] - Pre-opening expenses increased by $4.4 million to $9.0 million, driven by new store growth and $2.3 million in vacant rent expenses related to former Big Lots stores acquired through bankruptcy auctions[4] - Operating margin improved by 80 basis points to 11.3%[4] - Adjusted diluted net income per share increased by 26.9% to $0.99[4] - Adjusted EBITDA grew by 26.0% to $93.8 million, with adjusted EBITDA margin improving by 90 basis points to 13.8%[4] - Total cash and investments increased by 30.3% ($107.1 million) to $460.3 million, comprising $231.2 million in cash and cash equivalents, $85.9 million in short-term investments, and $143.2 million in long-term investments[4] Fiscal 2025 Outlook The company raised its FY2025 sales and earnings outlook, projecting higher new store openings, net sales, comparable store sales growth, gross margin, operating income, and adjusted diluted EPS Fiscal 2025 Outlook Details The company raised its FY2025 sales and earnings outlook, projecting higher new store openings, net sales, comparable store sales growth, gross margin, operating income, and adjusted diluted EPS Fiscal 2025 Outlook Comparison | Metric | Current Outlook | Previous Outlook | | :-------------------------------- | :------------------- | :------------------- | | New Store Openings | 85 | 75 | | Net Sales | $2.631 billion to $2.644 billion | $2.579 billion to $2.599 billion | | Comparable Store Sales Growth | 3.0% to 3.5% | 1.4% to 2.2% | | Gross Margin | 40.3% | 40.0% | | Operating Income | $292 million to $298 million | $283 million to $292 million | | Adjusted Net Income | $233 million to $237 million | $225 million to $232 million | | Adjusted Diluted Net Income Per Share | $3.76 to $3.84 | $3.65 to $3.75 | | Annual Effective Tax Rate | Approximately 25% | Approximately 25% | | Diluted Weighted Average Shares Outstanding | Approximately 62 million | Approximately 62 million | | Capital Expenditures | $83 million to $88 million | $83 million to $88 million | - The outlook includes approximately $5.0 million in vacant rent expenses, or $0.06 per adjusted diluted share, related to opening stores acquired through bankruptcy proceedings[6] - The outlook includes approximately $18.0 million in interest income, assuming potential interest rate reductions in fiscal 2025[7] Company Information & Disclosures This section provides details on the Q2 FY2025 conference call, an overview of Ollie's business model, explanations of non-GAAP financial measures, forward-looking statements, and investor and media contacts Conference Call Information A conference call was held on August 28, 2025, to discuss Q2 FY2025 financial results, with access available via pre-registration or the company's investor relations website - The Q2 Fiscal 2025 financial results conference call was held on August 28, 2025, at 8:30 AM ET[8] - Investors can access the live webcast or replay via pre-registration or by visiting the company's investor relations website at **https://investors.ollies.com/**[8](index=8&type=chunk) About Ollie's Ollie's is a leading discount retailer of brand-name closeout merchandise, offering "Real Brands! Real Bargains!" at significant discounts across 613 stores in 34 states - Ollie's is a leading discount retailer of brand-name closeout merchandise, founded in 1982 with the mission to sell "Good Stuff Cheap®"[9] - The company focuses on sourcing closeout and excess inventory from global suppliers and manufacturers through a flexible purchasing model[9] - Stores offer a treasure hunt shopping experience with "Real Brands! Real Bargains!®" at prices up to 70% below traditional retailers[9] - As of August 2, 2025, the company operated 613 stores across 34 states[9] Non-GAAP Financial Measures Explanation The company reports both GAAP and adjusted non-GAAP financial results, believing non-GAAP metrics provide a clearer comparison of core business performance by excluding non-core items - The company reports results on both GAAP and adjusted non-GAAP bases, with non-GAAP metrics including adjusted net income, adjusted diluted net income per share, and adjusted operating income[10] - The company believes that income and expense items excluded from non-GAAP adjustments do not reflect core business performance, and supplementary disclosure aids investors in comparing core business performance[10] - Refer to the "Reconciliation of GAAP to Non-GAAP Financial Measures" included in the press release for non-GAAP operating adjustments for the thirteen and twenty-six weeks ended August 2, 2025, and August 3, 2024[11] Forward-Looking Statements This press release contains forward-looking statements regarding industry trends, operations, and financial outlook, subject to risks and uncertainties under the Private Securities Litigation Reform Act of 1995 - The press release contains forward-looking statements concerning industry trends, value creation, customer trends, new stores, distribution centers, and financial outlook data including new store openings, net sales, comparable store sales, gross margin, SG&A, operating income, net income, adjusted net income, adjusted diluted net income per share, effective tax rate, diluted weighted average shares outstanding, and capital expenditures[12] - All forward-looking statements are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and may be affected by certain risks and uncertainties, any one or combination of which could materially affect the company's operating results[12] - Readers are cautioned not to place undue reliance on these forward-looking statements, and the company undertakes no obligation to publicly revise them to reflect subsequent events or circumstances, unless required by law[12] Investor and Media Contacts This section provides essential contact information for investor relations and media inquiries - Investor Contact: John Rouleau, Managing Director, Corporate Communications & Business Development, Email: JRouleau@ollies.us[13] - Media Contact: Tom Kuypers, Senior Vice President, Marketing & Advertising, Phone: 717-657-2300, Email: tkuypers@ollies.us[13] Condensed Consolidated Financial Statements (Unaudited) This section presents the condensed consolidated statements of income, balance sheets, and cash flows for the specified periods, providing a comprehensive overview of the company's financial position and performance Condensed Consolidated Statements of Income This section presents the condensed consolidated statements of income for the thirteen and twenty-six weeks ended August 2, 2025, and August 3, 2024, detailing key revenue and expense items Condensed Consolidated Statements of Income (Unaudited) | (in thousands, except per share amounts) | Thirteen Weeks Ended August 2, 2025 | Thirteen Weeks Ended August 3, 2024 | Twenty-Six Weeks Ended August 2, 2025 | Twenty-Six Weeks Ended August 3, 2024 | | :-------------------------------- | :------------------- | :------------------- | :------------------- | :------------------- | | Net Sales | $679,556 | $578,375 | $1,256,323 | $1,087,193 | | Cost of Sales | 408,218 | 359,344 | 747,954 | 658,804 | | Gross Profit | 271,338 | 219,031 | 508,369 | 428,389 | | Selling, General and Administrative Expenses | 175,476 | 145,673 | 340,308 | 288,092 | | Depreciation and Amortization Expense | 9,916 | 8,004 | 19,273 | 15,720 | | Pre-opening Expenses | 8,972 | 4,595 | 15,628 | 7,321 | | Operating Income | 76,974 | 60,759 | 133,160 | 117,256 | | Interest Income, Net | (4,534) | (3,928) | (9,322) | (8,229) | | Income Before Income Taxes | 81,508 | 64,687 | 142,482 | 125,485 | | Income Tax Expense | 20,198 | 15,705 | 33,612 | 30,161 | | Net Income | $61,310 | $48,982 | $108,870 | $95,324 | | Earnings Per Share of Common Stock: | | | | | | Basic | $1.00 | $0.80 | $1.77 | $1.55 | | Diluted | $0.99 | $0.79 | $1.76 | $1.54 | | As a Percentage of Net Sales: | | | | | | Net Sales | 100.0% | 100.0% | 100.0% | 100.0% | | Cost of Sales | 60.1 | 62.1 | 59.5 | 60.6 | | Gross Profit | 39.9 | 37.9 | 40.5 | 39.4 | | Selling, General and Administrative Expenses | 25.8 | 25.2 | 27.1 | 26.5 | | Depreciation and Amortization Expense | 1.5 | 1.4 | 1.5 | 1.4 | | Pre-opening Expenses | 1.3 | 0.8 | 1.2 | 0.7 | | Operating Income | 11.3 | 10.5 | 10.6 | 10.8 | | Interest Income, Net | (0.7) | (0.7) | (0.7) | (0.8) | | Income Before Income Taxes | 12.0 | 11.2 | 11.3 | 11.6 | | Income Tax Expense | 3.0 | 2.7 | 2.7 | 2.8 | | Net Income | 9.0% | 8.5% | 8.7% | 8.8% | Condensed Consolidated Balance Sheets This section presents the condensed consolidated balance sheets as of August 2, 2025, and August 3, 2024, detailing the company's assets, liabilities, and stockholders' equity Condensed Consolidated Balance Sheets (Unaudited) | (in thousands) | August 2, 2025 | August 3, 2024 | | :-------------------------------- | :------------------- | :------------------- | | Assets | | | | Current Assets: | | | | Cash and Cash Equivalents | $231,163 | $170,600 | | Short-term Investments | 85,893 | 182,544 | | Inventory | 637,236 | 531,286 | | Accounts Receivable | 1,810 | 1,187 | | Prepaid Expenses and Other Current Assets | 11,716 | 9,813 | | Total Current Assets | 967,818 | 895,430 | | Property and Equipment, Net | 360,836 | 307,163 | | Operating Lease Right-of-Use Assets | 652,341 | 494,169 | | Goodwill | 444,850 | 444,850 | | Trade Names | 230,559 | 230,559 | | Long-term Investments | 143,206 | - | | Other Assets | 2,242 | 2,122 | | Total Assets | $2,801,852 | $2,374,293 | | Liabilities and Stockholders' Equity | | | | Current Liabilities: | | | | Current Portion of Long-term Debt | $518 | $589 | | Accounts Payable | 165,629 | 129,824 | | Income Taxes Payable | 129 | - | | Current Portion of Operating Lease Liabilities | 103,122 | 87,476 | | Accrued Expenses and Other Current Liabilities | 98,968 | 79,952 | | Total Current Liabilities | 368,366 | 297,841 | | Long-term Debt | 912 | 984 | | Deferred Income Taxes | 85,640 | 72,803 | | Long-term Portion of Operating Lease Liabilities | 561,024 | 411,994 | | Total Liabilities | 1,015,942 | 783,622 | | Stockholders' Equity: | | | | Common Stock | 68 | 67 | | Additional Paid-in Capital | 745,636 | 713,509 | | Retained Earnings | 1,476,583 | 1,263,275 | | Treasury Stock - Common Stock | (436,377) | (386,180) | | Total Stockholders' Equity | 1,785,910 | 1,590,671 | | Total Liabilities and Stockholders' Equity | $2,801,852 | $2,374,293 | Condensed Consolidated Statements of Cash Flows This section presents the condensed consolidated statements of cash flows for the thirteen and twenty-six weeks ended August 2, 2025, and August 3, 2024, detailing cash flows from all activities Condensed Consolidated Statements of Cash Flows (Unaudited) | (in thousands) | Thirteen Weeks Ended August 2, 2025 | Thirteen Weeks Ended August 3, 2024 | Twenty-Six Weeks Ended August 2, 2025 | Twenty-Six Weeks Ended August 3, 2024 | | :-------------------------------- | :------------------- | :------------------- | :------------------- | :------------------- | | Net Cash Provided by Operating Activities | $80,712 | $43,875 | $109,414 | $84,059 | | Net Cash Used in Investing Activities | (39,744) | (90,883) | (58,010) | (159,398) | | Net Cash (Used in) Provided by Financing Activities | (8,823) | 5,358 | (25,364) | (20,323) | | Net Increase (Decrease) in Cash and Cash Equivalents | 32,145 | (41,650) | 26,040 | (95,662) | | Cash and Cash Equivalents at Beginning of Period | 199,018 | 212,250 | 205,123 | 266,262 | | Cash and Cash Equivalents at End of Period | $231,163 | $170,600 | $231,163 | $170,600 | Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited) This section provides detailed reconciliation tables for GAAP to non-GAAP financial measures, including adjusted net income and adjusted EBITDA, for the specified reporting periods Reconciliation Details This section provides reconciliation tables for GAAP net income to adjusted net income and EBITDA to adjusted EBITDA, detailing adjustments for the thirteen and twenty-six weeks ended August 2, 2025, and August 3, 2024 Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited) | (in thousands, except per share amounts) | Thirteen Weeks Ended August 2, 2025 | Thirteen Weeks Ended August 3, 2024 | Twenty-Six Weeks Ended August 2, 2025 | Twenty-Six Weeks Ended August 3, 2024 | | :-------------------------------- | :------------------- | :------------------- | :------------------- | :------------------- | | Net Income | $61,310 | $48,982 | $108,870 | $95,324 | | Excess Tax Benefit Related to Share-Based Compensation (1) | (425) | (756) | (1,912) | (1,888) | | Adjusted Net Income | $60,885 | $48,226 | $106,958 | $93,436 | | Diluted Net Income Per Share | $0.99 | $0.79 | $1.76 | $1.54 | | Adjustments Noted Above, Per Diluted Share: | | | | | | Excess Tax Benefit Related to Share-Based Compensation (1) | (0.01) | (0.01) | (0.03) | (0.03) | | Adjusted Diluted Net Income Per Share | $0.99 | $0.78 | $1.73 | $1.51 | | Diluted Weighted Average Common Shares Outstanding | 61,796 | 61,721 | 61,806 | 61,731 | | Net Income | $61,310 | $48,982 | $108,870 | $95,324 | | Interest Income, Net | (4,534) | (3,928) | (9,322) | (8,229) | | Depreciation and Amortization Expense | 13,452 | 10,039 | 26,261 | 19,824 | | Income Tax Expense | 20,198 | 15,705 | 33,612 | 30,161 | | EBITDA | 90,426 | 70,798 | 159,421 | 137,080 | | Non-Cash Share-Based Compensation Expense | 3,360 | 3,652 | 6,524 | 6,801 | | Adjusted EBITDA | $93,786 | $74,450 | $165,945 | $143,881 | - Amounts represent the impact of excess tax benefits recognized in accordance with Accounting Standards Update 2016-09, Share-Based Compensation[18] Key Statistics (Unaudited) This section presents key operational and financial statistics, including store count, sales performance, cash and investments, capital expenditures, and share repurchases for the specified period Operational and Financial Statistics This section provides key operational and financial statistics for the thirteen weeks ended August 2, 2025, and August 3, 2024, including store count, sales performance, and capital allocation Key Statistics (Unaudited) | (in thousands) | Thirteen Weeks Ended August 2, 2025 | Thirteen Weeks Ended August 3, 2024 | | :-------------------------------- | :------------------- | :------------------- | | Stores at Beginning of Period | 584 | 516 | | New Store Openings | 29 | 9 | | Store Closures | - | - | | Stores at End of Period | 613 | 525 | | Store Count Year-over-Year Growth | 16.8% | 8.9% | | Comparable Store Sales Change | 5.0% | 5.8% | | Comparable Stores at End of Period | 510 | 475 | | Total Cash and Investments (1) | $460,262 | $353,144 | | Capital Expenditures | $26,416 | $38,289 | | Share Repurchases | $11,516 | $6,428 | - Total cash and investments include cash and cash equivalents, short-term investments, and long-term investments[19]