Five Below Profit Rises, Again Lifts FY Outlook; Stock Up - Update

(RTTNews) - Specialty retailer Five Below Inc. (FIVE), Monday reported a swing to second-quarter profit, helped by a near 35 percent jump in sales, while the prior year was impacted by the payment of preferred stock dividend.

The company once again lifted its outlook for 2013, sending its shares up 12.5 percent in after-hours trading on the Nasdaq.

"We saw solid performance across most of our categories reflecting the broad appeal of the Five Below concept, merchandise and value proposition," said CEO Thomas Vellios.

A discount retailer, Five Below targets teens and pre-teen shoppers, offering products from headphones to fashion accessories to candy, all priced at $5 or below.

The Philadelphia, Pennsylvania-based company reported second-quarter net earnings to shareholders of $4 million or $0.07 per share, compared with a net loss of $64 million or $3.41 per share last year.

Results for the prior-year quarter included preferred-stock dividend payment of $65 million.

Excluding items, adjusted earnings for the quarter were $6 million or $0.11 per share, compared with $2 million or $0.04 per share a year ago.

On average, 13 analysts polled by Thomson Reuters expected earnings of $0.09 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the second quarter climbed to $117 million from $87 million in the prior year. Analysts expected sales of $112.70 million for the quarter.

The company opened 18 new stores and ended the quarter with 276 stores.

For the third quarter, Five Below expect net earnings in the range of $0.01 to $0.02 per share, adjusted earnings of $0.03 to $0.04 per share and sales of $107 million to $109 million. Analysts currently expect earnings of $0.03 per share on sales of $109.22 million for the quarter.

For fiscal 2013, the company expects net earnings of $0.60 to $0.63 per share, adjusted earnings of $0.68 to $0.71 per share and sales of $531 million to $536 million. Earlier, Five Below anticipated net earnings of $0.57 to $0.60 per share, adjusted earnings of $0.65 to $0.68 per share and sales of $524 million to $529 million.

Analysts currently expect earnings of $0.69 per share on sales of $535.15 million for 2013.

The company's stock closed Monday at $41.04, up $1.55 or 3.93%, on a volume of over 1 million shares. In after hours, the stock gained $5.15 or 12.55%.