By Sam Boughedda
Leslie's, Inc. (NASDAQ:LESL) shares tumbled Wednesday, currently down more than 8%, after the company reported its fiscal fourth quarter earnings report.
The retailer of swimming pool supplies posted earnings of $0.35 per share, $0.03 better than the analyst estimate of $0.32, with revenue for the quarter coming in at $475.6 million versus the consensus estimate of $470.51M. Comparable sales increased by 10.2%.
"We are pleased to close out the year on a strong note with 16.3% sales growth, a 30.1% increase in net income, and a 21.3% increase in Adjusted EBITDA for the fourth quarter. This performance was enabled by the outstanding work of our supply chain team driving strong DC performance in the quarter. For the full year, execution of our strategic growth initiatives resulted in record sales, gross profit and Adjusted EBITDA, as well as market share gains," commented Mike Egeck, Chief Executive Officer of the company.
Despite acknowledging the challenging macro backdrop, the company remains positive, although its guidance came in below expectations. The company sees FY2022 EPS between $0.78 and $0.86, below consensus expectations of $0.93, with revenue expected to be between $1.56B and $1.64B, above the $1.56B expected.
Following the earnings release, Goldman Sachs analysts said: "LESL reported 4Q22 adjusted EPS of $0.35, better than GS/consensus (FactSet) estimates of $0.30/$0.31. SSS growth of +10.2% was higher than GS/consensus of +9.0%/+8.6%. LESL's adjusted EBITDA was $99.5 mn, slightly above the GS/consensus estimates of $99.2 mn/$96.0 mn. LESL's inventory increased +82% YoY in 4Q22 vs. 3Q22 +61% YoY. Management attributed LESL's robust 4Q22 results to their supply chain team's ability to drive strong DC performance."
"Although Q4 was a high quality beat with better comps and less gross margin pressure than estimated, we expect pressure on LESL's stock today given the lower-than-expected 2023 guidance."