Q2 2024 Five Below Inc Earnings Call Transcript
Key Points
- Sales in the second quarter increased by 9.4% to $830 million.
- Five Below Inc (FIVE) opened 62 new stores across 22 states in the second quarter.
- The company ended the quarter with $328 million in cash, cash equivalents, and investments, and no debt.
- The company is committed to refocusing on its core customers and enhancing value, improving the shopping experience, and streamlining operations.
- Five Below Inc (FIVE) plans to moderate store growth for 2025, allowing for better execution and more selective real estate locations.
- Comparable sales were down 5.7%, driven by a decrease in comp transactions and comp ticket.
- Gross margin decreased by approximately 220 basis points to 32.7%, primarily due to deleverage of fixed costs and higher year-over-year shrink accrual.
- Operating income for the quarter decreased to $41.5 million from $58.6 million in the second quarter of 2023.
- Net income for the second quarter of 2024 was $33.0 million, down from $46.8 million last year.
- The company acknowledged that it had lost focus on its core customers and over-expanded its product assortment, leading to operational challenges.
Good day and welcome to the Five Below second-quarter 2024 earnings conference call. (Operator Instructions) Please note this event is being recorded.
I would now like to turn the conference over to Christiane Pelz, Vice President of Investor Relations. Please go ahead.
Thank you, Drew. Good afternoon, everyone, and thanks for joining us today for Five Below's second-quarter 2024 financial results conference call. On today's call are Tom Vellios, Executive Chairman and Founder; and Ken Bull, Interim President and Chief Executive Officer and Chief Operating Officer; and Kristy Chipman, Chief Financial Officer and Treasurer. After management has made their formal remarks, we will open the call to questions.
I need to remind you that certain comments made during this call may constitute forward-looking statements and are made pursuant to and within the meaning of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 as amended. Such forward-looking
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