Burlington Stores has reported strong earnings and comparable store sales, contributing to the success of “off-price” retailers. CEO Michael O’Sullivan stated that the chain had a strong August and September, with November also showing a solid start. As a result, shares rose over 20% following the news.
The discount apparel and footwear chain exceeded forecasts by reporting third quarter fiscal 2023 earnings per share of $0.98 and a 6% increase in comparable store sales from a year ago. Revenue also increased by 12% to $2.29 billion, in line with estimates. Additionally, their gross margin gained 200 basis points, merchandise margin improved by 150 bps, and freight expense was up by 50 bps.
Michael O’Sullivan also mentioned that Burlington had a strong trend in August and September, delivering earnings at the high end of their expectations. He expressed confidence in the holiday shopping season, stating that November is off to a solid start.
In a similar trend, Ross Stores also announced stronger-than-expected results this month as inflation-weary consumers seek more affordable prices.
Burlington Stores shares rose to their highest level since August, even though they remained in negative territory for the year.