Burlington Stores(US:BURL)2025-11-25 21:17Store Operations - As of November 1, 2025, the company operates 1,211 stores across 46 states, Washington D.C., and Puerto Rico, having opened 129 new stores during the nine-month period[101] - The company plans to average about 100 net new store openings per year, targeting a total of 500 new stores from Fiscal 2024 through Fiscal 2028[106] - As of November 1, 2025, the company opened 129 new stores, bringing the total store count to 1,211[184] Financial Performance - Net income for the three months ended November 1, 2025, was $104.8 million, up from $90.6 million for the same period in 2024, representing a 15.0% increase[114] - For the nine months ended November 1, 2025, net income increased to $299.8 million from $242.9 million in the prior year, reflecting a 23.4% growth[114] - Adjusted Net Income for the three months ended November 1, 2025, rose to $107.5 million, an increase of $7.6 million compared to the same period last year[121] - Net income for Q3 Fiscal 2025 was $104.8 million, compared to $90.6 million in Q3 Fiscal 2024, primarily due to higher sales and increased gross margin rate[152] - Net sales increased by $562.4 million, or 7.7%, to $7,907.1 million for the nine-month period ended November 1, 2025, driven by 108 net new stores and a 2% increase in comparable store sales[153] Profitability Metrics - Adjusted EBIT increased by $14.6 million to $155.9 million for the three months ended November 1, 2025, and by $67.2 million to $453.1 million for the nine months ended November 1, 2025, compared to the prior year[126] - Adjusted EBITDA rose by $26.4 million to $255.2 million for the three months ended November 1, 2025, and by $97.0 million to $739.0 million for the nine months ended November 1, 2025, driven by higher sales and increased gross margin[126] - Comparable store sales increased by 1% for the three months ended November 1, 2025, and remained stable at 2% for the nine months ended[130] - Gross margin as a percentage of net sales improved to 44.2% during the three months ended November 1, 2025, compared to 43.9% for the same period in 2024[132] Inventory and Cash Flow - Inventory increased to $1,658.4 million as of November 1, 2025, from $1,440.7 million a year earlier, primarily due to an increase in reserve inventory and the opening of 108 new stores[134] - Cash and cash equivalents decreased by $410.6 million during the nine months ended November 1, 2025, compared to a decrease of $67.6 million during the same period in 2024[137] Expenses and Costs - Selling, general and administrative expenses as a percentage of net sales decreased to 35.0% during the three months ended November 1, 2025, from 35.4% in the prior year[142] - Cost of sales as a percentage of net sales decreased to 55.8% during the three months ended November 1, 2025, compared to 56.1% in the same period of 2024[141] - The company incurred $10.9 million in pre-opening costs related to leases acquired through bankruptcy proceedings during the third quarter of Fiscal 2025[143] - Depreciation and amortization expense increased to $99.3 million in Q3 Fiscal 2025 from $87.5 million in Q3 Fiscal 2024, driven by new and non-comparable stores[144] - Impairment charges on long-lived assets were $3.8 million in Q3 Fiscal 2025, up from $3.0 million in Q3 Fiscal 2024, primarily related to one store expected to sell below net carrying value[145] Debt and Financing - The company's total debt obligations include $1,723.3 million under the Term Loan Facility and $297.1 million of 2027 Convertible Notes as of November 1, 2025[185] - The average borrowings during the nine-month period ended November 1, 2025, amounted to $26.9 million at an average interest rate of 5.5%[191] - The company has $947.9 million available under the ABL Line of Credit as of November 1, 2025[191] - The 2027 Convertible Notes bear an interest rate of 1.25% per year and will mature on December 15, 2027[195] - The company entered into a $200.0 million interest rate swap agreement with a fixed interest rate of 3.76% during the second quarter of Fiscal 2025[199] - The company refinanced $933.0 million principal amount of Term B-6 Loans with Term B-7 Loans totaling $1,250.0 million[187] - The company has interest rate swaps hedging $1,100.0 million of variable rate exposure under its Term Loan Facility[200] Risks and Challenges - The company anticipates that ongoing economic uncertainties, including inflation and consumer spending habits, may impact revenues and income[105] - The company faces various risks including general economic conditions, competitive factors, and seasonal fluctuations that could impact net sales and operating income[205] - The company acknowledges potential disruptions in its distribution network and the need to protect information systems against cyber-related attacks[205] - The company emphasizes the importance of adapting to changing consumer preferences and demand to sustain growth plans[205] - The company is subject to various regulatory requirements and must comply with increasingly rigorous privacy and data security regulations[205] - The company notes that past financial performance should not be relied upon as an indication of future performance due to unpredictable factors[206] - The company has not reported any material changes to its market risk disclosures since the last fiscal report[208] - Recent accounting pronouncements have been discussed in the condensed consolidated financial statements, indicating ongoing compliance efforts[207]