Burlington to Open 100+ New Stores This Year

Burlington Stores is speeding up its plans to open more new stores after a year of good sales growth. The off-price retailer reported a 4% increase in comparable store sales for fiscal 2023 and beat expectations in the fourth quarter.

Even with the positive results, CEO Michael O'Sullivan said on an earnings call that he was a little let down, stating: "We are happy that we beat guidance, but more importantly we see some clear opportunities to drive even stronger performance."

A big opportunity is opening a lot more new store locations. Burlington plans to open approximately 140 new stores in 2024, with the goal of achieving around 100 net new locations after accounting for relocations and closures.

"We have rigorous standards for the quality of new store locations, and over the last couple of years this has made it difficult to hit this 100-store run rate," O'Sullivan explained. "We think the external environment over the next few years is likely to be favorable for off-price, and we are excited about the initiatives we have been pursuing."

Getting many former Bed Bath & Beyond store locations in bankruptcy helped Burlington grow faster. Around one-third of the new 2024 store openings will happen this spring, utilizing some of those former Bed Bath sites.

O'Sullivan is bullish on Burlington's long-term prospects, stating the company believes it can reach $16 billion in total sales and $1.6 billion in operating income over the next five years.

For fiscal 2024 specifically, Burlington forecasts adjusted earnings between $7.00 to $7.60 per share, with total sales growth projected in the 9% to 11% range. Burlington expects to spend around $750 million on opening new stores and other expansion investments.

The recent fourth quarter capped a "strong year" according to O'Sullivan, with total revenue increasing 14% to $3.12 billion and net income rising to $227.5 million or $3.53 per share.

While acknowledging "uncertainty in the external environment," the CEO says Burlington is "ready to chase if the sales trend is stronger" and remains "very excited about the long-term outlook" despite some short-term caution in planning.

With over 1,000 stores currently across 46 states plus D.C. and Puerto Rico, the off-price retailer is quickly increasing the number of its physical stores across the nation.