In May, Five Below revealed its intentions to grow by leveraging Simon’s retail portfolio, which includes its Premium Outlets. This approach has been recognized as the means by which the specialty discount retailer aims to propel its growth.
During the retailer’s second quarter earnings call Wednesday (Aug 30), Joel D. Anderson, president and CEO of Five Below, highlighted the company’s emphasis on expanding its stores. The goal is a nationwide footprint of over 3,500 locations.
“In the second quarter. We opened 40 new stores across 24 states. One of these openings in Louisiana made our top 25 All Time Grand Opening list. We continue to see great opportunities in the marketplace and remain on track to achieve our goal of opening over 200 stores this year,” Anderson said.
The company is looking to roll out over 130 stores in just the following four months.
Anderson also highlights that Five Below’s accomplishments include nearly 400 conversions, for a total exceeding 600 converted stores. The latest store prototype was introduced during the company’s investor day as a store-within-a-store innovation.
In addition, in its previous quarterly earnings report, Five Below reported to be courting a new customer demographic through its Five Beyond concept, which offers products priced above $5 but still positioned as “below the rest,” as described on the company website.
“New stores, they remain a key growth engine,” Anderson said in March. “We have refocused resources to accelerate our store growth and reach a milestone of 200 new stores this year.”
Anderson also said Five Below had broadened its perspective on the types of centers where it can establish a Five Below store beyond its emphasis on suburban centers.
“We are now accelerating urban as well as semi-rural stores and are testing alternative venues,” Anderson said.
In relation to Five Beyond, Anderson observed that the company expanded its customer base and offered a distinct shopping experience by maintaining the ability to “stay on top of hot trends” and swiftly move to capitalize on them.
During the second quarter of fiscal 2022, Five Below witnessed a net sales increase of 13.5% to $759 million from $668.9 million in the same period. Comparable sales also grew by 2.7% year over year (YoY).
The company added 40 stores, ending the quarter with 1,407 stores across 43 states a 12.4% increase YoY.
Operating income for the quarter stood at $58.6 million, up from $56 million YoY. Net income totaled $46.8 million, up from $41.3 million YoY.