Q2 2025 Ollie's Bargain Outlet Holdings Inc Earnings Call Transcript
Key Points
- Ollie's Bargain Outlet Holdings Inc (OLLI) reported strong second-quarter results, with new store openings, total sales, comparable store sales, and adjusted earnings all exceeding expectations.
- The company opened 54 new stores in the first six months of the year, surpassing its previous full-year unit growth record.
- Ollie's Army loyalty program saw a 10.6% increase in members, reaching 16.1 million, with members accounting for over 80% of sales.
- Net sales increased by 18% to $680 million, driven by new store openings and a 5% increase in comparable store sales.
- Gross margin improved by 200 basis points to 39.9%, aided by lower supply chain costs and higher merchandise margins.
- 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 slightly higher store labor expenses.
- Preopening expenses rose to $9 million, largely due to the higher number of new store openings and dark rent associated with bankruptcy-acquired stores.
- The company experienced unusually high medical expenses from severe cases, which are expected to normalize but currently impact SG&A costs.
- Despite strong performance, Ollie's Bargain Outlet Holdings Inc (OLLI) faces challenges from tariffs and market disruptions, which could impact future deal flow.
- The accelerated store growth may lead to a potential comp drag as new stores move into the comp base, a historical trend for the company.
Good morning, and welcome to Ollie's Bargain Outlet's conference call to discuss financial results for the second-quarter of fiscal year 2025.
Please be advised that this call is being recorded, and the reproduction of this call in whole or in part is not permitted without the express written authorization of Ollie's.
Joining today's call from Ollie's management are Eric van der Valk, President and Chief Executive Officer; and Robert Helm, Executive Vice President and Chief Financial Officer. Certain comments made on today's call may constitute forward-looking statements, and these are made pursuant to and within the meaning of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 as amended.
Such forward-looking statements are subject to both known and unknown risks and uncertainties that could cause actual results to differ materially from such statements. Those risks and uncertainties are described in the company's earnings press release and filings with the SEC, including the annual report on Form 10-K and quarterly reports on Form 10-Q.
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