Five Below Q3 Sales Grow, But Comps Decline

Third quarter sales at Five Below were up more than 6%, but the retailer reported decreases in comparable store sales and net income for the 13-week period ended Oct. 29.

Net sales in the quarter were $645.0 million, up 6.2% from net sales of $607.6 million in the third quarter of fiscal 2021. Comparable sales decreased by 2.7% and net income was $16.1 million, down from net income of $24.2 million in the comparable quarter the previous year.

During the quarter, the company opened 40 new stores and ended the quarter with 1,292 stores in 42 states. This represents an increase in stores of 10.1% from the end of the third quarter of fiscal 2021.

“We delivered third quarter results that were better than our guidance in spite of the difficult macro environment and challenging year-over-year comparison,” said Joel Anderson, president and CEO of Five Below. “Our performance was driven by ticket and transaction metrics that improved throughout the quarter, disciplined expense management and continued focus on our long-term Triple Double vision.”

During the quarter, the company expanded to two new states, North Dakota and South Dakota. The retailer also completed its 2022 Five Beyond growth initiative with approximately 250 stores converted to a new store format.

Year-to-date net sales increased by 5.5% to $1.95 billion, up from net sales of $1.85 billion in the year to date period of fiscal 2021. Comparable sales decreased 4.1% and net income dipped to $90.2 million compared to $138.6 million in the year-to-date period of fiscal 2021.

The company opened 102 new stores compared to 153 net new stores in the year-to-date period of fiscal 2021.

“We are continuing to play offense, and the progress we made across product, experience and supply chain will all drive our holiday execution,” Anderson said. “With the completion of our five-node distribution network, we are set up to deliver products to our growing store base even more efficiently. As we look ahead, we are focused more than ever on delivering an exciting holiday assortment of extreme value products that promise to Wow our customers while also providing a fun shopping experience.”