Ollie's Bargain Outlet (OLLI) investor relations material

Executive summary

• Net sales rose 18% year-over-year to $680 million, driven by new store openings and a 5% increase in comparable store sales, with adjusted earnings and customer engagement exceeding expectations.

• Opened 54 new stores in the first half, including 29 in the quarter (22 from bankruptcy-acquired leases), surpassing previous records and ending the quarter with 613 stores.

• Ollie's Army loyalty program membership grew to 16.1 million, now accounting for over 80% of sales, with enhanced engagement from revamped events.

• Net income increased 25.2% to $61.3 million, with adjusted EPS up 26.9% to $0.99 and adjusted EBITDA up 26% to $94 million.

• Celebrated 43rd anniversary, 10 years as a public company, and recognized as a top-performing retail IPO.

Financial highlights

• Gross margin improved by 200 basis points to 39.9%, attributed to lower supply chain costs, higher merchandise margins, and reduced shrink.

• SG&A expenses increased 60 basis points to 25.8% of sales, mainly due to higher medical and casualty claims and increased store labor costs.

• Operating margin increased 80 basis points to 11.3% for the quarter.

• Total cash and investments increased 30% to $460 million, with no meaningful long-term debt.

• Share repurchases totaled $12 million in the quarter, with $304 million remaining under authorization.

Outlook and guidance

• Raised full-year guidance: 85 new store openings, net sales of $2.631–$2.644 billion, comparable store sales growth of 3–3.5%, gross margin of 40.3%, operating income of $292–$298 million, and adjusted EPS of $3.76–$3.84.

• Capital expenditures projected at $83–$88 million for the year, including distribution center expansions and store-level initiatives.

• Liquidity remains strong with $317.1 million in cash and short-term investments and $90.4 million available under the credit facility.