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Investing.com -- Ollie’s Bargain Outlet Holdings, Inc. reported better-than-expected first quarter earnings and revenue on Tuesday, but shares fell 3% premarket following the release.
The discount retailer posted adjusted earnings per share of $0.75, surpassing analyst estimates of $0.71. Revenue rose 13.4% YoY to $576.8 million, exceeding the consensus forecast of $565.9 million. Comparable store sales increased 2.6%, driven by higher transaction volumes.
Ollie’s opened 25 new stores in the quarter, including 18 former Big Lots (NYSE:BIG) locations acquired through bankruptcy auction. The company ended the period with 584 stores across 32 states, representing 13.2% YoY growth.
"We had a strong first quarter, highlighted by accelerated store growth and better than expected sales and earnings," said Eric van der Valk, President and CEO. "As consumers seek out value and the current environment weighs on retailers and suppliers, we believe we are well positioned to benefit and continue to serve our customers with amazing deals."
Gross margin remained flat at 41.1%, as lower supply chain costs were offset by reduced merchandise margins due to changes in product mix. SG&A expenses as a percentage of sales increased 60 basis points to 28.6%, primarily due to higher medical and casualty claims.
For fiscal 2025, Ollie’s reaffirmed its outlook, projecting EPS of $3.65-$3.75 on revenue of $2.58-2.6 billion. This compares to analyst expectations of $3.73 EPS and $2.58 billion in revenue.
The company’s cash and investment position grew 21.5% YoY to $414.9 million. Ollie’s repurchased 159,757 shares for $17.1 million during the quarter, with $315.5 million remaining under its current buyback authorization.