Ollie's Seizing Opportunities for Growth
At a time when many businesses across the retail landscape are contending with market headwinds, Ollie’s Bargain Outlet Holdings Inc. sees opportunity for growth.
“With so many retailers closing stores or going bankrupt in the past year, there are a considerable number of abandoned customers, merchandise, real estate and talent in the marketplace,” said Eric van der Valk, president and CEO. “We think there is a unique opportunity to take on some of these assets in a manner that strengthens our competitive positioning, broadens our footprint and bolsters shareholder returns for years to come. With our expanded supply chain, flexible and resilient operating model, fortress balance sheet, and committed associates, we are ready.”
[RELATED: Will Store Closures Accelerate in 2025?]
It does appear that the closeout retailer is poised for growth, as it recently reported strong fiscal 2024 results. Ollie’s net sales grew 8.0% to $2.272 billion, from $2.103 billion in fiscal 2023. Excluding the impact of the 53rd week in fiscal 2023, net sales jumped 9.8%.
Comparable-store sales increased 2.8%, from the prior-year increase of 5.7%.
Net income increased 10.1% to $199.8 million, or $3.23 per diluted share, in fiscal 2024, from $181.4 million, or $2.92 per diluted share, in fiscal 2023. Adjusted net income, which excluded excess tax benefits related to stock-based compensation and a one-time equity awards expense, jumped 12.2% to $202.4 million, or $3.28 per diluted share.
Adjusted EBITDA soared 13.8% to $313.1 million in fiscal 2024, from $275.2 million in fiscal 2023.
“We were very pleased with our financial results and the underlying trends in our business," said van der Valk. "At a time when consumers need it most, we are delivering unprecedented value through an ever-changing assortment that combines quality, national brands and pricing in a way that can only be found at Ollie’s."
Capital expenditures were $120.6 million in fiscal 2024, primarily related to the development of new stores; the completion of the company’s fourth distribution center, in Princeton, Ill.; the acquisition of former 99 Cents Only Stores and Big Lots Stores locations through the bankruptcy auction process; and the remodeling of existing stores.
The company opened 50 new stores and closed three stores in fiscal 2024, ending the year with 559 stores in 31 states, an increase of 9.2% year over year.
Ollie's plans to accelerate new store openings during fiscal 2025 to 75 stores. It's off to a good start with the recent acquisition of 40 more former Big Lots store leases from Gordon Brothers. Including these newest locations, the company has acquired a total of 63 former Big Lots store leases.
With its path to accelerated growth secured, Ollie's estimates for the fiscal year ending Jan. 31, 2026, that its net sales will be $2.564 billion to $2.586 billion; comparable store sales will increase 1% to 2%; adjusted net income will be $225 million to $232 million; and adjusted net income per diluted share will be $3.65 to $3.75.
A Harrisburg, Pa.-based extreme discounter, Ollie's is America's largest retailer of closeout merchandise and excess inventory. The company offers brand-name products in a variety of departments, including housewares, food, stationery, and health and beauty aids. It currently operates 575 stores in 31 states.
