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Ulta Results Show Beauty Takes no Backseat to Pandemic

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Beauty clearly takes no backseat when it comes to a pandemic.

So showed Ulta Beauty’s  (ULTA) - Get Ulta Beauty Inc Report second-quarter results, which came in far better than expected as consumers continued to scoop up their favorite brands of makeup and accessories.

The cosmetics retailer posted adjusted per-share earnings of 73 cents for the quarter ended Aug. 1, beating analysts' estimates of 6 cents a share.

Comparable-store sales, a key metric for retailers, were down 10% in July, but much improved from the 37% drop the company saw back in May. The improvement continued in August, with sales off by just mid-single digits through the first three weeks, Ulta said.

The results were another bright spot in the increasingly bifurcated retail world, where retailers with generally lower-priced goods are seeing a recovery in sales, vs. higher-end retailers who are struggling to get consumers to open their wallets.

They also highlighted consumers’ insistence on looking good, particularly with video conferencing becoming the new work-from-home normal. The company also said e-commerce sales more than tripled in the quarter.

Ulta said it brought 17,000 furloughed workers back on the job as it re-opened stores. After temporarily closing all locations due to the pandemic, Ulta fully reopened all its stores by July 20.

For the second half of fiscal 2021, Ulta expects to incur around $35 million to $40 million in personal-protective equipment and Covid-19-related costs.

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