Ollie's Bargain Outlet Q1: Earnings Beat, 12.9% Topline Growth, Raises FY23 Outlook & More

Ollie's Bargain Outlet Holdings, Inc. OLLI reported first-quarter FY23 sales growth of 12.9% year-on-year to $459.15 million, beating the consensus of $451.35 million. Comparable store sales increased 4.5% compared to a 17.3% decrease last year.

Gross profit increased 26.4% to $178.6 million, while gross margin increased 410 basis points to 38.9%. The increase in gross margin was primarily due to favorable supply chain costs, partially offset by lower merchandise margin related to shrink and a higher mix of consumables.

Operating income increased 124.8% to $38.5 million in Q1, while operating margin increased 420 basis points to 8.4%. Adjusted EBITDA increased 88.5% to $49.5 million in Q1, while adjusted EBITDA margin increased 430 basis points to 10.8%.

As of the end of Q1, inventories decreased by 3.7% to $498.0 million. The company exited the quarter with $275.5 million in cash and equivalents.

Adjusted EPS of $0.49 beat the analyst consensus of $0.48.

Outlook: Ollie's increased its FY23 outlook. The company increased its net sales outlook to $2.052 billion-$2.067 billion (prior guidance $2.036 billion-$2.058 billion) versus the consensus of $2.04 billion.

Ollie's Bargain outlet sees FY23 Adjusted EPS of $2.56-$2.65 (prior guidance: $2.49-$2.58) versus the consensus of $2.56.

Price Action: OLLI shares are trading lower by 2.06% at $60.73 on the last check Wednesday.