Five Below ended the quarter with 1,367 stores in 43 states.
Five Below is continuing its aggressive expansion even as its customers face “multiple macro headwinds.
The tween and teen discounter reported a 13.5% increase in first-quarter revenue and reaffirmed its plans to open a record 200-plus stores in its current fiscal year, with the majority of the openings in the back-half of the year. Looking ahead, the chain already has a “strong pipeline” of new stores for 2024, CEO Joel Anderson said on the earnings call.
In addition, Five Below is on track to complete more than 400 store conversions this year to its Five Beyond format, which has an in-store area dedicated to items priced above the chain’s signature $5.00 threshold.
Five Below reported first-quarter net income of $37.5 million, or $0.67 a share, in the quarter ended April 29, compared with $32.7 million, or $0.59 a share, in the year-ago quarter. Analysts had expected earnings per share of $0.63.
Revenue rose 13.5% to $726.2 million, compared with $639.6 million in the prior-year quarter. Same-store sales rose 2.7%. Five Below had a 3.9% comp transaction increase, which was the highest since 2017.
“While our customers face multiple macro headwinds, we continue to be there for them, flexing our offering to bring them the Wow products they need and want,” Anderson stated in the earnings release. “Our broad-based sales performance and transaction trends demonstrate that we are gaining trips and customers through our amazing value, trend-right products and Five Beyond prototype.”
Looking to the rest of the year, Anderson said the company remains focused on playing offense to drive increased market share.
“With the headwinds of the pandemic moderating, combined with our continued experience and efficiency-based initiatives, we believe we are well-positioned to continue our high growth,” he said.
Five Below raised the low end of its full-year revenue and profit forecasts. The company expects full-year revenue of between $3.5 billion and $3.57 billion, based on its plans to open more than 200 stores, compared to its prior forecast of $3.49 billion to $3.59 billion. Same-store sales are expected to increase 1% to 3%.
Earnings per share are expected to range from $5.31 to $5.71 compared to its prior estimate of $5.25 to $5.76.
The company opened 27 new stores across 19 states and ended the quarter with 1,367 stores in 43 states.