Ulta Beauty Inc (NASDAQ:ULTA) Q3 2019 Earnings Conference Call - Final Transcript

Dec 05, 2019 • 05:00 pm ET


Ulta Beauty Inc (NASDAQ:ULTA) Q3 2019 Earnings Conference Call - Final Transcript


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Scott Settersten

mini remodels to enable the addition of new brands and improvements to overall fixturing. We anticipate driving topline growth of approximately 10% with total Company comparable sales planned in the 4.7% to 5% range, compared to the previous guidance of 4% to 6%. We continue to expect e-commerce to grow in the 20% to 30% range. We expect to deliver diluted earnings per share in the range of $11.93 to $12.03, with approximately 60 basis points to 70 basis points of operating margin deleverage. This compares to previous guidance of $11.86 to $12.06. Our updated EPS guidance includes the $0.02 of income tax benefit earned in the third quarter and a narrower range, reflecting the fact that there is only one quarter remaining in the year.

We continue to expect to deliver gross profit improvement for the year, driven by merchandise margin expansion, rent and occupancy expense, cost leverage and the benefits of our credit card program. These benefits will be offset by SG&A deleverage due to investments in store labor, growth initiatives and digital innovation. We now plan to spend between $305 million and $315 million in CapEx. The reduction from previous guidance primarily reflects our decision to delay the opening of our fast fulfillment center in Jacksonville until 2021. We now expect full year CapEx will include approximately $170 million for new stores, remodels and merchandise fixtures, $90 million for supply chain and IT and about $50 million for store maintenance and other. Depreciation and amortization expense is expected to be approximately $300 million. We expect our tax rate for the year to be approximately 23%. This projected tax rate does not include any estimate for the potential Q4 impact of share-based compensation or federal income tax credit. The fully diluted share count for the year is expected to be approximately 58 million. Our plan assumes share repurchases in 2019 in the $700 million range.

And now, I'll turn it over to our conference call host to moderate the Q&A session.