Burlington Stores Q2 Loss Narrows, Lifts Full-year Outlook

(RTTNews) - Off-price retailer Burlington Stores, Inc. (BURL) on Tuesday reported a loss for the second quarter that narrowed from last year, reflecting higher revenues and growth in comparable store sales.

Looking ahead, the company forecast earnings for the third quarter in line with analysts' estimates and raised its financial outlook for fiscal 2014.

Tom Kingsbury, President and Chief Executive Officer of Burlington Stores said, "We are extremely pleased with our second quarter performance highlighted by a 4.7% increase in comparable store sales on top of last year's very strong 7.8% increase. Our 70 basis point increase in Adjusted EBITDA rate was driven by both operating expense leveraging and gross margin expansion versus last year."

The company's net loss for the second quarter was $6.47 million, narrower than loss of $25.01 million in the previous year. Pro forma adjusted loss for the quarter was $877 thousand or $0.01 per share, compared to adjusted loss of $13.58 million or $0.19 per share last year.

On average, eleven analysts polled by Thomson Reuters expected the company to report loss of $0.08 per share for the quarter. Analysts' estimates typically exclude one-time items.

Total revenue for the quarter grew 8 percent to $1.05 billion from $971.48 million in the same period last year. Net sales also increased 8 percent to $1.04 billion. Analysts had a consensus revenue estimate of $1.03 billion for the quarter.

Comparable store sales for the quarter increased 4.7 percent, on top of a 7.8 percent increase last year. During the quarter, the company also recorded an increase of $36.3 million from new and non-comparable stores.

Gross margin expanded by 50 basis points from last year to 38.2 percent.

Looking ahead to the third quarter, Burlington Stores forecast adjusted net income per share in a range of $0.09 to $0.12, compared to adjusted loss per share of $0.05 in the year-ago period. The company projects net sales for the quarter to increase in a range of 6.4 percent to 7.4 percent, while comparable store sales are expected to rise 3 percent to 4 percent.

Analysts expect earnings of $0.11 per share for the quarter on revenues of $1.14 billion.

For fiscal 2014, Burlington Stores now forecasts adjusted earnings per share of $1.52 to $1.58 per share, up from the prior estimate of $1.25 to $1.35 per share.

Total sales for the year are now expected to increase in a range of 6.5 percent to 7.2 percent, compared to the prior expectation for an increase of 5.8 percent to 6.8 percent. Comparable store sales growth for the full year is now expected to be approximately 3 percent, at the high end of prior guidance for an increase of of 2 percent to 3 percent.

These estimates include a comparable store sales increase of 2 percent to 3 percent in the fourth quarter, consistent with the company's previous guidance.

Analysts expect earnings of $1.53 per share for the year on revenues of $4.72 billion.

Kingsbury said, "We believe we are well positioned for the fall season based on the level and currency of our inventory and remain focused on delivering great value, brands,store experience and fresh product to our customers every day."

BURL closed Monday's trading at $36.06, down $0.53 or 1.45 percent on a volume of 1.35 million shares.