Ollie’s Bargain Outlet powered through a robust second quarter, as the off-price retailer continued to benefit from current market conditions and heightened consumer demand.
Net sales increased 58.5% to $529.3 million in the second quarter of fiscal 2020 as compared with net sales of $333.9 million in the second quarter of fiscal 2019. The increase in net sales was driven by a comparable store sales increase of 43.3% and strong new store performance.
The company said it experienced robust comparable store sales growth throughout the second quarter of fiscal 2020, driven by higher traffic levels and a significantly larger average basket. The company said it effectively responded to changing consumer needs in the period, creating a strong alignment between a value-driven merchandise assortment and customer demand. The company also benefited from consumer spending in response to federal stimulus funds for the COVID-19 pandemic and having its stores open during the quarter while several other retailers were closed for a portion of the period.
Net income increased to $99.4 million, or $1.50 per diluted share, in the second quarter of fiscal 2020 compared with net income of $25.2 million, or $0.38 per diluted share, in the second quarter of fiscal 2019. Diluted earnings per share in the second quarter of fiscal 2020 and fiscal 2019 included a benefit of $0.46 and $0.03, respectively, due to excess tax benefits related to stock-based compensation
John Swygert, president and CEO, Ollie’s, said, “We delivered our best quarter in our 38-year history with record top- and bottom-line results. Our performance reflects the strength of our business model as we remained nimble and responsive to opportunities in the marketplace to meet heightened levels of customer demand during the COVID-19 pandemic. We executed the Ollie’s formula— buy cheap and sell cheap— and had the right products at great prices. I am very grateful for the extraordinary contributions of our entire team— our merchants, distribution centers, store support center and store associates—who have worked tirelessly to keep pace with the spike in demand and to ensure the continued health and safety of our customers and each other.”
Swygert continued, “We continue to be pleased with customer response to our great deals, with comparable store sales trends currently tracking in the high teens. However, we fully expect sales growth to continue to slow as we progress through the second half of the year. Due to the uncertainty related to COVID-19, we are not providing guidance for the second half of fiscal 2020. We remain confident that we are very well-positioned to benefit from the continued disruption in the marketplace as we continue to leverage our strong vendor relationships and the expertise of our teams. It’s the effectiveness of our model, our strong financial position and long-term growth opportunities that keep us very excited about our future.”