Upcoming AWS Coverage on Costco Wholesale Post-Earnings Results

LONDON, UK / ACCESSWIRE / December 16, 2016 / Active Wall St. announces its post-earnings coverage on Ollie's Bargain Outlet Holdings, Inc. (NASDAQ: OLLI) ("Ollie's"). The Company reported its third quarter fiscal 2016 (Q3 FY16) earnings on December 07, 2016. The Harrisburg, Pennsylvania-based Company's total net sales rose 15.7% y-o-y and net income surged 54.7% y-o-y, outperforming market consensus estimates. Register with us now for your free membership at: http://www.activewallst.com/register/.

One of Ollie's Bargain Outlet's competitors within the Discount, Variety Stores space, Costco Wholesale Corp. (NASDAQ: COST), reported on December 07, 2016, its first quarter fiscal year 2017 operating results. AWS will be initiating a research report on Costco Wholesale in the coming days.

Today, AWS is promoting its earnings coverage on OLLI; touching on COST. Get our free coverage by signing up to:

http://www.activewallst.com/registration-3/?symbol=OLLI

http://www.activewallst.com/registration-3/?symbol=COST

Earnings Reviewed

During Q3 FY16, Ollie's reported net revenues of $201.99 million which came in above $174.57 million recorded in prior-year's same period; results also beat market expectations of $201.3 million. The company attributed the rise in net sales to a 1.8% increase in comparable store sales and increased store count compared to Q3 FY15.

For the quarter ended October 30, 2016, the retailer reported net income of $10.46 million, or $0.17 per diluted share, compared to $6.76 million, or $0.11 per diluted share, in the year-ago comparable period. The company reported adjusted net income of $10.82 million, or $0.17 per diluted share, in Q3 FY16 versus $6.76 million, or $0.11 per diluted share, in Q3 FY15. Adjusted net income readings also beat market estimates of $0.14 per diluted share.

In Q3 FY16, Ollie's inaugurated 16 new stores and now has a total of 232 stores in 19 states, an increase of 16.0% y-o-y. For full year FY16, the company plans to open a total of 31 new stores and has no plans to pull the shutter on any of the operating stores.

Operating Metrics

Ollie's Q3 FY16 gross margin came in at $84.19 million, or 41.7% of net sales, compared to $69.92 million, or 40.1% of net sales, in last year's comparable quarter. The company attributed the rise in gross margin to lower transportation and distribution costs as a percent of net sales.The company's operating income rose to $18.65 million, or 9.2% of net revenues, in Q3 FY16 from $13.94 million, or 8.0% of net revenues, in Q3 FY15. Furthermore, adjusted operating income rose 38.0% to $19.23 million in Q3 FY16 from $13.94 million in the prior year's same quarter. As a percent of net sales, adjusted operating income increased 150 basis points y-o-y to 9.5% in Q3 FY16. During the quarter, adjusted EBITDA surged 34.0% to $23.59 million, or 11.7% of net sales, from $17.60 million, or 10.1% of net sales, in Q3 FY15.

Balance Sheet Numbers

For Q3 FY16, Ollie's net cash provided by operating activities was $5.85 million compared to $1.77 million in the prior year's same quarter. As on October 29, 2016, the company had cash and cash equivalents amounting to $35.96 million compared to $3.96 million recorded as on October 31, 2015. The company reported net long-term debt of $190.11 million as on October 29, 2016, compared to $206.07 million as on October 31, 2015. Furthermore, the company had no borrowings under its $100.0 million revolving credit and $98.3 million of availability under the facility at the end of Q3 FY16.
The company's inventory increased 13.3% to $240.77 million as on October 29, 2016, from $212.58 million as on October 31, 2015, primarily due to new store growth. Additionally, capital expenditures during Q3 FY16 totaled $4.3 million versus $4.9 million in Q3 FY15.

Earnings Outlook

For the fiscal year January 28, 2017, Ollie's management expects total net sales to be in the range of $882 million and $885 million with comparable store sales growth in the range of 2.5% to 3.0%. Operating income for FY16 is forecasted to be in the range of $100 million to $101 million. Net income for FY16 is anticipated to be in the range of $0.91 per diluted share to $0.92 per diluted share; while adjusted net income is expected to be between $0.92 per diluted share to $0.93 per diluted share. Furthermore, the company anticipated capital expenditures to be in the range of $17.0 million to $18.0 million during full year FY16.

Stock Performance

On December 15, 2016, Ollie's Bargain Outlet's share price finished yesterday's trading session at $30.25, advancing 1.51%. A total volume of 841.01 thousand shares exchanged hands, which was higher than the 3 months average volume of 826.70 thousand shares. The stock has rallied 29.66% and 77.73% in the last six months and past twelve months, respectively. Furthermore, since the start of the year, shares of the company have skyrocketed 77.84%. The stock is trading at a PE ratio of 36.27 and has a market cap of $1.85 billion.

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SOURCE: Active Wall Street