Ulta Beauty's e-commerce jumps 63%

Ulta Beauty

Ulta Beauty recorded outstanding fourth-quarter results, led by a 63.4% sales increase in e-commerce, and overall, the net sales increased 24.6%, comparable sales 16.6%. In total, the company made $1,580.6 million for the quarter, in large part driven by a 10.9% growth in transactions and a 5.7% growth in average sales ticket. 

"The Ulta Beauty team delivered outstanding fourth quarter results, capping an exceptional year of sales and earnings growth while investing to drive market share gains and create sustainable long term shareholder value," said Mary Dillon, CEO. 

Overall for the fiscal year of 2016, Ulta Beauty's sales increased 23.7% to $4,854.7 million, up from $3,924.1 million in fiscal 2015. That's a comparable sales increase of 15.8% due to a growth in transaction and tickets sizes. Still above the 50% mark, e-commerce comparable sales grew 56.2%, representing 15.8% of the of the company's total comparable sales increase for the year. 

Ulta Beauty opened 104 new stores in 2016, relocated two and remodeled 12, similar to the 103 new stores opened in 2015, five relocations and four remodels. 

During a quarterly conference call Dillon highlighted some of the company's significant accomplishments that contributed to the top line growth including adding 69 brew brands to the portion, launching the Ulta Beauty credit card program and new merchandising technology that helped improve product forecasting and allocation.

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Perhaps one of the most noteworthy accomplishments for the year was increasing the number of active loyalty members by 28% from 5.2 million to 23.4 million members. Just in the fourth quarter alone, membership rose 1.7 million, driven by marketing communication and excellence conversion in-store. 

"We continue to see strength in retention rates, sales per member, frequency of purchase and average members’ ticket. Our loyalty program allows us to execute compelling serum campaigns, which drove incremental sales and margin," Dillon said. 

Over the call, Dillon also announced a new partnership with Estee Lauder Companies, selling their MAC brand online starting in May and in store starting in June. The products will reach more than 100 stores in 2017. 

Looking ahead, Scott Settersten, Ulta Beauty's CFO, did say that Ulta Beauty still needs to play "catch-up" wish some basic omnichannel capabilities such as buy online pick-up in-store and to open a handful of non-prototypical stores. 

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