ULTA BEAUTY, INC., 10-Q filed on 12/4/2014
Quarterly Report
Document and Entity Information
9 Months Ended
Nov. 1, 2014
Nov. 25, 2014
Document And Entity Information [Abstract]
 
 
Document Type
10-Q 
 
Amendment Flag
false 
 
Document Period End Date
Nov. 01, 2014 
 
Document Fiscal Year Focus
2014 
 
Document Fiscal Period Focus
Q3 
 
Trading Symbol
ULTA 
 
Entity Registrant Name
Ulta Salon, Cosmetics & Fragrance, Inc. 
 
Entity Central Index Key
0001403568 
 
Current Fiscal Year End Date
--01-31 
 
Entity Filer Category
Large Accelerated Filer 
 
Entity Common Stock, Shares Outstanding
 
64,365,655 
Consolidated Balance Sheets (USD $)
In Thousands, unless otherwise specified
Nov. 1, 2014
Feb. 1, 2014
Nov. 2, 2013
Current assets:
 
 
 
Cash and cash equivalents
$ 295,060 
$ 419,476 
$ 240,916 
Short-term investments
100,000 
 
 
Receivables, net
49,399 
47,049 
46,911 
Merchandise inventories, net
709,667 
457,933 
582,303 
Prepaid expenses and other current assets
60,907 
55,993 
54,757 
Prepaid income taxes
 
 
1,729 
Deferred income taxes
15,709 
22,246 
14,686 
Total current assets
1,230,742 
1,002,697 
941,302 
Property and equipment, net
686,898 
595,736 
590,132 
Deferred compensation plan assets
5,119 
4,294 
3,913 
Total assets
1,922,759 
1,602,727 
1,535,347 
Current liabilities:
 
 
 
Accounts payable
236,329 
148,282 
190,193 
Accrued liabilities
128,465 
103,180 
97,421 
Accrued income taxes
4,917 
15,349 
 
Total current liabilities
369,711 
266,811 
287,614 
Deferred rent
293,895 
261,630 
259,217 
Deferred income taxes
65,880 
66,718 
55,568 
Other long-term liabilities
6,940 
4,474 
4,629 
Total liabilities
736,426 
599,633 
607,028 
Stockholders' equity:
 
 
 
Common stock, $.01 par value, 400,000 shares authorized; 64,992, 64,793 and 64,793 shares issued; 64,414, 64,231 and 64,231 shares outstanding; at November 1, 2014 (unaudited), February 1, 2014 and November 2, 2013 (unaudited), respectively
650 
647 
647 
Treasury stock-common, at cost
(9,713)
(8,125)
(8,125)
Additional paid-in capital
573,118 
548,194 
544,101 
Retained earnings
622,278 
462,378 
391,696 
Total stockholders' equity
1,186,333 
1,003,094 
928,319 
Total liabilities and stockholders' equity
$ 1,922,759 
$ 1,602,727 
$ 1,535,347 
Consolidated Balance Sheets (Parenthetical) (USD $)
In Thousands, except Per Share data, unless otherwise specified
Nov. 1, 2014
Feb. 1, 2014
Nov. 2, 2013
Statement of Financial Position [Abstract]
 
 
 
Common stock, par value
$ 0.01 
$ 0.01 
$ 0.01 
Common stock, shares authorized
400,000 
400,000 
400,000 
Common stock, shares issued
64,992 
64,793 
64,793 
Common stock, shares outstanding
64,414 
64,231 
64,231 
Consolidated Statements of Income (unaudited) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Nov. 1, 2014
Nov. 2, 2013
Nov. 1, 2014
Nov. 2, 2013
Income Statement [Abstract]
 
 
 
 
Net sales
$ 745,722 
$ 618,781 
$ 2,193,728 
$ 1,802,491 
Cost of sales
463,967 
387,120 
1,406,678 
1,154,804 
Gross profit
281,755 
231,661 
787,050 
647,687 
Selling, general and administrative expenses
181,093 
151,306 
501,304 
418,754 
Pre-opening expenses
6,574 
7,468 
12,798 
15,483 
Operating income
94,088 
72,887 
272,948 
213,450 
Interest income, net
(254)
(7)
(663)
(49)
Income before income taxes
94,342 
72,894 
273,611 
213,499 
Income tax expense
35,218 
27,464 
103,740 
81,332 
Net income
$ 59,124 
$ 45,430 
$ 169,871 
$ 132,167 
Net income per common share:
 
 
 
 
Basic
$ 0.92 
$ 0.71 
$ 2.64 
$ 2.07 
Diluted
$ 0.91 
$ 0.70 
$ 2.63 
$ 2.05 
Weighted average common shares outstanding:
 
 
 
 
Basic
64,419 
64,061 
64,347 
63,912 
Diluted
64,738 
64,538 
64,655 
64,424 
Consolidated Statements of Cash Flows (unaudited) (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Nov. 1, 2014
Nov. 2, 2013
Operating activities
 
 
Net income
$ 169,871 
$ 132,167 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
Depreciation and amortization
96,055 
77,572 
Deferred income taxes
5,699 
278 
Non-cash stock compensation charges
11,436 
11,936 
Excess tax benefits from stock-based compensation
(3,290)
(13,352)
Loss on disposal of property and equipment
2,945 
3,374 
Change in operating assets and liabilities:
 
 
Receivables
(2,350)
(5,396)
Merchandise inventories
(251,734)
(221,178)
Prepaid expenses and other current assets
(4,914)
(4,305)
Income taxes
(7,142)
1,569 
Accounts payable
88,047 
71,307 
Accrued liabilities
7,621 
(5,759)
Deferred rent
32,265 
51,214 
Other assets and liabilities
1,641 
706 
Net cash provided by operating activities
146,150 
100,133 
Investing activities
 
 
Purchases of short-term investments
(100,000)
 
Purchases of property and equipment
(172,498)
(176,966)
Net cash used in investing activities
(272,498)
(176,966)
Financing activities
 
 
Repurchase of common shares
(9,972)
(37,337)
Stock options exercised
10,202 
21,890 
Excess tax benefits from stock-based compensation
3,290 
13,352 
Purchase of treasury shares
(1,588)
(631)
Net cash provided by (used in) financing activities
1,932 
(2,726)
Net decrease in cash and cash equivalents
(124,416)
(79,559)
Cash and cash equivalents at beginning of period
419,476 
320,475 
Cash and cash equivalents at end of period
295,060 
240,916 
Supplemental cash flow information
 
 
Cash paid for income taxes (net of refunds)
104,891 
78,941 
Noncash investing activities:
 
 
Change in property and equipment included in accrued liabilities
$ 17,664 
$ 11,053 
Consolidated Statement of Stockholders' Equity (unaudited) (USD $)
In Thousands
Total
Common Stock [Member]
Treasury - Common Stock [Member]
Additional Paid-In Capital [Member]
Retained Earnings [Member]
Balance at Feb. 01, 2014
$ 1,003,094 
$ 647 
$ (8,125)
$ 548,194 
$ 462,378 
Balance, Shares at Feb. 01, 2014
 
 
(562)
 
 
Balance, Shares at Feb. 01, 2014
 
64,793 
 
 
 
Stock options exercised and other awards
10,202 
 
10,198 
 
Stock options exercised and other awards, Shares
 
285 
 
 
 
Purchase of treasury shares
(1,588)
 
(1,588)
 
 
Purchase of treasury shares, Shares
 
 
(16)
 
 
Net income for the 39 weeks ended November 1, 2014
169,871 
 
 
 
169,871 
Excess tax benefits from stock-based compensation
3,290 
 
 
3,290 
 
Stock compensation charge
11,436 
 
 
11,436 
 
Repurchase of common shares
(9,972)
(1)
 
 
(9,971)
Repurchase of common shares, Shares
 
(86)
 
 
 
Balance at Nov. 01, 2014
$ 1,186,333 
$ 650 
$ (9,713)
$ 573,118 
$ 622,278 
Balance, Shares at Nov. 01, 2014
 
 
(578)
 
 
Balance, Shares at Nov. 01, 2014
 
64,992 
 
 
 
Business and basis of presentation
Business and basis of presentation
1. Business and basis of presentation

Ulta Salon, Cosmetics & Fragrance, Inc. was incorporated in the state of Delaware on January 9, 1990, to operate specialty retail stores selling cosmetics, fragrance, haircare and skincare products and related accessories and services. The stores also feature full-service salons. As of November 1, 2014, the Company operated 765 stores in 47 states, as shown in the table below. As used in these notes and throughout this Quarterly Report on Form 10-Q, all references to “we,” “us,” “our,” “Ulta” or the “Company” refer to Ulta Salon, Cosmetics & Fragrance, Inc. and its consolidated subsidiary, Ulta Inc.

 

State

   Number of
stores
  

State

   Number of
stores

Alabama

   12    Nebraska    3

Arizona

   24    Nevada    8

Arkansas

   6    New Hampshire    6

California

   87    New Jersey    19

Colorado

   16    New Mexico    2

Connecticut

   8    New York    27

Delaware

   1    North Carolina    25

Florida

   54    North Dakota    1

Georgia

   26    Ohio    28

Idaho

   4    Oklahoma    9

Illinois

   45    Oregon    9

Indiana

   15    Pennsylvania    28

Iowa

   7    Rhode Island    2

Kansas

   6    South Carolina    13

Kentucky

   9    South Dakota    2

Louisiana

   13    Tennessee    10

Maine

   3    Texas    75

Maryland

   12    Utah    11

Massachusetts

   12    Virginia    21

Michigan

   36    Washington    15

Minnesota

   11    West Virginia    4

Mississippi

   5    Wisconsin    13

Missouri

   16    Wyoming    1
        

 

Montana

   5    Total    765

The accompanying unaudited consolidated financial statements and related notes have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q and the U.S. Securities and Exchange Commission’s Article 10, Regulation S-X. These consolidated financial statements were prepared on a consolidated basis to include the accounts of the Company and its wholly owned subsidiary. All significant intercompany accounts, transactions, and unrealized profit were eliminated in consolidation. In the opinion of management, the accompanying consolidated financial statements reflect all adjustments, which are of a normal recurring nature, necessary to fairly state the financial position and results of operations and cash flows for the interim periods presented.

The Company’s business is subject to seasonal fluctuation. Significant portions of the Company’s net sales and net income are realized during the fourth quarter of the fiscal year due to the holiday selling season. The results for the 13 and 39 weeks ended November 1, 2014 are not necessarily indicative of the results to be expected for the fiscal year ending January 31, 2015, or for any other future interim period or for any future year.

 

These interim consolidated financial statements and the related notes should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended February 1, 2014. All amounts are stated in thousands, with the exception of per share amounts and number of stores.

Summary of significant accounting policies
Summary of significant accounting policies
2. Summary of significant accounting policies

Information regarding the Company’s significant accounting policies is contained in Note 2, “Summary of significant accounting policies,” to the financial statements in the Company’s Annual Report on Form 10-K for the year ended February 1, 2014. Presented below in this and the following notes is supplemental information that should be read in conjunction with “Notes to Financial Statements” in the Annual Report.

Fiscal quarter

The Company’s quarterly periods are the 13 weeks ending on the Saturday closest to April 30, July 31, October 31, and January 31. The Company’s third quarters in fiscal 2014 and 2013 ended on November 1, 2014 and November 2, 2013, respectively.

Share-based compensation

The Company measures share-based compensation cost on the grant date, based on the fair value of the award, and recognizes the expense on a straight-line method over the requisite service period for awards expected to vest. The Company estimated the grant date fair value of stock options using a Black-Scholes valuation model using the following weighted-average assumptions for the periods indicated:

 

     39 Weeks Ended  
     November 1, 2014     November 2, 2013  

Volatility rate

     40.8     49.6

Average risk-free interest rate

     1.4     0.8

Average expected life (in years)

     3.8        4.4   

Dividend yield

     None        None   

The Company granted 362 and 286 stock options during the 39 weeks ended November 1, 2014 and November 2, 2013, respectively. The compensation cost that has been charged against operating income was $2,386 and $2,167 for the 13 weeks ended November 1, 2014 and November 2, 2013, respectively. The compensation cost that has been charged against operating income was $6,990 and $7,804 for the 39 weeks ended November 1, 2014 and November 2, 2013, respectively. The weighted-average grant date fair value of these options was $32.22 and $36.77, respectively. At November 1, 2014, there was approximately $19,286 of unrecognized compensation expense related to unvested stock options.

The Company issued 70 and 139 restricted stock awards during 39 weeks ended November 1, 2014 and November 2, 2013, respectively. The compensation cost that has been charged against operating income was $1,447 and $2,230 for the 13 weeks ended November 1, 2014 and November 2, 2013, respectively. The compensation cost that has been charged against operating income was $4,446 and $4,132 for the 39 weeks ended November 1, 2014 and November 2, 2013, respectively. At November 1, 2014, there was approximately $9,526 of unrecognized compensation expense related to restricted stock awards.

Recent accounting pronouncements

In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers, issued as a new Topic, Accounting Standards Codification Topic 606. The new revenue recognition standard provides a five-step analysis of transactions to determine when and how revenue is recognized. The core principle is that the Company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. This standard is effective beginning in fiscal year 2017 and allows for either full retrospective or modified retrospective adoption. The Company is currently evaluating the application method and the impact of this new standard on its consolidated financial position, results of operations and cash flows.

Commitments and contingencies
Commitments and contingencies
3. Commitments and contingencies

Leases – The Company leases stores, distribution and office facilities and certain equipment. Original non-cancelable lease terms range from three to ten years, and store leases generally contain renewal options for additional years. A number of the Company’s store leases provide for contingent rent payments based upon sales. Contingent rent amounts were insignificant in the 13 and 39 weeks ended November 1, 2014 and November 2, 2013. Total rent expense under operating leases was $40,840 and $36,897 for the 13 weeks ended November 1, 2014 and November 2, 2013, respectively. Total rent expense under operating leases was $118,319 and $102,837 for 39 weeks ended November 1, 2014 and November 2, 2013, respectively.

 

General litigation – On March 2, 2012, a putative employment class action lawsuit was filed against us and certain unnamed defendants in state court in Los Angeles County, California. On April 12, 2012, the Company removed the case to the United States District Court for the Central District of California. On August 8, 2013, the plaintiff asked the court to certify the proposed class and the Company opposed the plaintiff’s request and is waiting for the court to issue a decision. The plaintiff and members of the proposed class are alleged to be (or to have been) non-exempt hourly employees. The suit alleges that Ulta violated various provisions of the California labor laws and failed to provide plaintiff and members of the proposed class with full meal periods, paid rest breaks, certain wages, overtime compensation and premium pay. The suit seeks to recover damages and penalties as a result of these alleged practices. The Company denies plaintiff’s allegations and is vigorously defending the matter.

The Company has not recorded any accruals for this matter because the Company’s potential liability for the matter is not probable and cannot be reasonably estimated based on currently available information. The Company cannot determine a reasonable estimate of the maximum possible loss or range of loss for this matter given that it is in the early stage of the litigation process and is subject to the inherent uncertainties of litigation (such as the strength of the Company’s legal defenses and the availability of insurance recovery). Although the maximum amount of liability that may ultimately result from this matter cannot be predicted with certainty, management expects that this matter, when ultimately resolved, will not have a material adverse effect on the Company’s consolidated financial position or liquidity. It is possible, however, that the ultimate resolution of this matter could have a material adverse effect on the Company’s results of operations in a particular quarter or year if such resolution results in a significant liability for the Company.

The Company is also involved in various legal proceedings that are incidental to the conduct of its business. In the opinion of management, the amount of any liability with respect to these proceedings, either individually or in the aggregate, will not be material.

Notes payable
Notes payable
4. Notes payable

On October 19, 2011, the Company entered into an Amended and Restated Loan and Security Agreement (the Loan Agreement) with Wells Fargo Bank, National Association, as Administrative Agent, Collateral Agent and a Lender thereunder, Wells Fargo Capital Finance LLC as a Lender, J.P. Morgan Securities LLC as a Lender, JP Morgan Chase Bank, N.A. as a Lender and PNC Bank, National Association, as a Lender. The Loan Agreement amended and restated the Loan and Security Agreement, dated as of August 31, 2010, by and among the lenders. The Loan Agreement extended the maturity of the Company’s credit facility to October 2016, provides maximum revolving loans equal to the lesser of $200,000 or a percentage of eligible owned inventory, contains a $10,000 subfacility for letters of credit and allows the Company to increase the revolving facility by an additional $50,000, subject to consent by each lender and other conditions. The Loan Agreement contains a requirement to maintain a minimum amount of excess borrowing availability at all times.

On September 5, 2012, the Company entered into Amendment No. 1 to Amended and Restated Loan and Security Agreement (the First Amendment) with the lender group. The First Amendment updated certain administrative terms and conditions and provides the Company greater flexibility to take certain corporate actions. There were no changes to the revolving loan amounts available, interest rates, covenants or maturity date under terms of the Loan Agreement.

On December 6, 2013, the Company entered into Amendment No. 2 to the Amended and Restated Loan and Security Agreement (the Second Amendment) with the lender group. The Second Amendment extended the maturity of the facility to December 2018. Substantially all of the Company’s assets are pledged as collateral for outstanding borrowings under the facility. Outstanding borrowings will bear interest at the prime rate or Libor plus 1.50% and the unused line fee is 0.20%.

As of November 1, 2014, February 1, 2014 and November 2, 2013, the Company had no borrowings outstanding under the credit facility and the Company was in compliance with all terms and covenants of the agreement.

Investments
Investments
5. Investments

The Company’s short-term investments as of November 1, 2014 consist of $50,000 in certificates of deposit and $50,000 in time deposits. These short-term investments are carried at cost, which approximates fair value and are recorded in the Consolidated Balance Sheets in Short-term investments. The contractual maturity of the Company’s investments was less than twelve months at November 1, 2014.

Fair Value Measurements
Fair Value Measurements
6. Fair Value Measurements

The carrying value of cash and cash equivalents, accounts receivable, and accounts payable approximates their estimated fair values due to the short maturities of these instruments.

 

Fair value is measured using inputs from the three levels of the fair value hierarchy, which are described as follows:

 

    Level 1 – observable inputs such as quoted prices for identical instruments in active markets.

 

    Level 2 – inputs other than quoted prices in active markets that are observable either directly or indirectly through corroboration with observable market data.

 

    Level 3 – unobservable inputs in which there is little or no market data, which would require the Company to develop its own assumptions.

As of November 1, 2014, the Company held financial liabilities of $5,121 related to its non-qualified deferred compensation plan. The liabilities have been categorized as Level 2 as they are based on third-party reported net asset values, which are based primarily on quoted market prices of underlying assets of the funds within the plan.

Net income per common share
Net income per common share
7. Net income per common share

The following is a reconciliation of net income and the number of shares of common stock used in the computation of net income per basic and diluted share:

 

     13 Weeks Ended      39 Weeks Ended  
     November 1,      November 2,      November 1,      November 2,  

(In thousands, except per share data)

   2014      2013      2014      2013  
           

Net income

   $ 59,124       $ 45,430       $ 169,871       $ 132,167   
           

Denominator for basic net income per share – weighted-average common shares

     64,419         64,061         64,347         63,912   

Dilutive effect of stock options and non-vested stock

     319         477         308         512   
  

 

 

    

 

 

    

 

 

    

 

 

 

Denominator for diluted net income per share

     64,738         64,538         64,655         64,424   
           

Net income per common share:

           

Basic

   $ 0.92       $ 0.71       $ 2.64       $ 2.07   

Diluted

   $ 0.91       $ 0.70       $ 2.63       $ 2.05   

The denominators for diluted net income per common share for the 13 weeks ended November 1, 2014 and November 2, 2013 exclude 500 and 254 employee stock options, respectively, due to their anti-dilutive effects.

The denominators for diluted net income per common share for the 39 weeks ended November 1, 2014 and November 2, 2013 exclude 744 and 669 employee stock options, respectively, due to their anti-dilutive effects.

Share repurchase program
Share repurchase program
8. Share repurchase program

On March 18, 2013, the Company announced that our Board of Directors had authorized a share repurchase program (the 2013 Share Repurchase Program) pursuant to which the Company could repurchase up to $150,000 of the Company’s common stock. Repurchases pursuant to the terms of the 2013 Share Repurchase Program were made from time to time in the open market, in privately negotiated transactions or otherwise, at prices the Company deemed appropriate and subject to market conditions, applicable law and other factors deemed relevant in the Company’s sole discretion. The 2013 Share Repurchase Program did not have an expiration date, but provided for suspension or discontinuation at any time.

On September 11, 2014, the Company announced that our Board of Directors authorized a new share repurchase program (the 2014 Share Repurchase Program) pursuant to which the Company may repurchase up to $300,000 of the Company’s common stock. The 2014 Share Repurchase Program authorization revokes the previously authorized but unused amounts of $112,664 from the 2013 Share Repurchase Program. The 2014 Share Repurchase Program does not have an expiration date and may be suspended or discontinued at any time.

 

During the 39 weeks ended November 2, 2013, we purchased 501 shares of common stock for $37,337 at an average price of $74.58. During the 13 and 39 weeks ended November 1, 2014, the Company purchased 86 shares of common stock for $9,972 at an average price of $116.09.

Summary of significant accounting policies (Policies)

Fiscal quarter

The Company’s quarterly periods are the 13 weeks ending on the Saturday closest to April 30, July 31, October 31, and January 31. The Company’s third quarters in fiscal 2014 and 2013 ended on November 1, 2014 and November 2, 2013, respectively.

Share-based compensation

The Company measures share-based compensation cost on the grant date, based on the fair value of the award, and recognizes the expense on a straight-line method over the requisite service period for awards expected to vest.

Recent accounting pronouncements

In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers, issued as a new Topic, Accounting Standards Codification Topic 606. The new revenue recognition standard provides a five-step analysis of transactions to determine when and how revenue is recognized. The core principle is that the Company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. This standard is effective beginning in fiscal year 2017 and allows for either full retrospective or modified retrospective adoption. The Company is currently evaluating the application method and the impact of this new standard on its consolidated financial position, results of operations, and cash flows.

Business and basis of presentation (Tables)
Details of Company Operated Stores

As of November 1, 2014, the Company operated 765 stores in 47 states, as shown in the table below. As used in these notes and throughout this Quarterly Report on Form 10-Q, all references to “we,” “us,” “our,” “Ulta” or the “Company” refer to Ulta Salon, Cosmetics & Fragrance, Inc. and its consolidated subsidiary, Ulta Inc.

 

State

   Number of
stores
  

State

   Number of
stores

Alabama

   12    Nebraska    3

Arizona

   24    Nevada    8

Arkansas

   6    New Hampshire    6

California

   87    New Jersey    19

Colorado

   16    New Mexico    2

Connecticut

   8    New York    27

Delaware

   1    North Carolina    25

Florida

   54    North Dakota    1

Georgia

   26    Ohio    28

Idaho

   4    Oklahoma    9

Illinois

   45    Oregon    9

Indiana

   15    Pennsylvania    28

Iowa

   7    Rhode Island    2

Kansas

   6    South Carolina    13

Kentucky

   9    South Dakota    2

Louisiana

   13    Tennessee    10

Maine

   3    Texas    75

Maryland

   12    Utah    11

Massachusetts

   12    Virginia    21

Michigan

   36    Washington    15

Minnesota

   11    West Virginia    4

Mississippi

   5    Wisconsin    13

Missouri

   16    Wyoming    1
        

 

Montana

   5    Total    765

Summary of significant accounting policies (Tables)
Black-Scholes Valuation Model Weighted-Average Assumptions

The Company estimated the grant date fair value of stock options using a Black-Scholes valuation model using the following weighted-average assumptions for the periods indicated:

 

     39 Weeks Ended  
     November 1, 2014     November 2, 2013  

Volatility rate

     40.8     49.6

Average risk-free interest rate

     1.4     0.8

Average expected life (in years)

     3.8        4.4   

Dividend yield

     None        None   
Net income per common share (Tables)
Net Income Per Basic and Diluted Share

The following is a reconciliation of net income and the number of shares of common stock used in the computation of net income per basic and diluted share:

 

     13 Weeks Ended      39 Weeks Ended  
     November 1,      November 2,      November 1,      November 2,  

(In thousands, except per share data)

   2014      2013      2014      2013  
           

Net income

   $ 59,124       $ 45,430       $ 169,871       $ 132,167   
           

Denominator for basic net income per share – weighted-average common shares

     64,419         64,061         64,347         63,912   

Dilutive effect of stock options and non-vested stock

     319         477         308         512   
  

 

 

    

 

 

    

 

 

    

 

 

 

Denominator for diluted net income per share

     64,738         64,538         64,655         64,424   
           

Net income per common share:

           

Basic

   $ 0.92       $ 0.71       $ 2.64       $ 2.07   

Diluted

   $ 0.91       $ 0.70       $ 2.63       $ 2.05   

Business and Basis of Presentation - Additional Information (Detail)
Nov. 1, 2014
State
Store
Organization, Consolidation and Presentation of Financial Statements [Abstract]
 
Number of stores
765 
Number of states in which entity operates
47 
Business and Basis of Presentation - Details of Company Operated Stores (Detail)
Nov. 1, 2014
Store
Product Information [Line Items]
 
Number of stores
765 
Alabama [Member]
 
Product Information [Line Items]
 
Number of stores
12 
Arizona [Member]
 
Product Information [Line Items]
 
Number of stores
24 
Arkansas [Member]
 
Product Information [Line Items]
 
Number of stores
California [Member]
 
Product Information [Line Items]
 
Number of stores
87 
Colorado [Member]
 
Product Information [Line Items]
 
Number of stores
16 
Connecticut [Member]
 
Product Information [Line Items]
 
Number of stores
Delaware [Member]
 
Product Information [Line Items]
 
Number of stores
Florida [Member]
 
Product Information [Line Items]
 
Number of stores
54 
Georgia [Member]
 
Product Information [Line Items]
 
Number of stores
26 
Idaho [Member]
 
Product Information [Line Items]
 
Number of stores
Illinois [Member]
 
Product Information [Line Items]
 
Number of stores
45 
Indiana [Member]
 
Product Information [Line Items]
 
Number of stores
15 
Iowa [Member]
 
Product Information [Line Items]
 
Number of stores
Kansas [Member]
 
Product Information [Line Items]
 
Number of stores
Kentucky [Member]
 
Product Information [Line Items]
 
Number of stores
Louisiana [Member]
 
Product Information [Line Items]
 
Number of stores
13 
Maine [Member]
 
Product Information [Line Items]
 
Number of stores
Maryland [Member]
 
Product Information [Line Items]
 
Number of stores
12 
Massachusetts [Member]
 
Product Information [Line Items]
 
Number of stores
12 
Michigan [Member]
 
Product Information [Line Items]
 
Number of stores
36 
Minnesota [Member]
 
Product Information [Line Items]
 
Number of stores
11 
Mississippi [Member]
 
Product Information [Line Items]
 
Number of stores
Missouri [Member]
 
Product Information [Line Items]
 
Number of stores
16 
Montana [Member]
 
Product Information [Line Items]
 
Number of stores
Nebraska [Member]
 
Product Information [Line Items]
 
Number of stores
Nevada [Member]
 
Product Information [Line Items]
 
Number of stores
New Hampshire [Member]
 
Product Information [Line Items]
 
Number of stores
New Jersey [Member]
 
Product Information [Line Items]
 
Number of stores
19 
New Mexico [Member]
 
Product Information [Line Items]
 
Number of stores
New York [Member]
 
Product Information [Line Items]
 
Number of stores
27 
North Carolina [Member]
 
Product Information [Line Items]
 
Number of stores
25 
North Dakota [Member]
 
Product Information [Line Items]
 
Number of stores
Ohio [Member]
 
Product Information [Line Items]
 
Number of stores
28 
Oklahoma [Member]
 
Product Information [Line Items]
 
Number of stores
Oregon [Member]
 
Product Information [Line Items]
 
Number of stores
Pennsylvania [Member]
 
Product Information [Line Items]
 
Number of stores
28 
Rhode Island [Member]
 
Product Information [Line Items]
 
Number of stores
South Carolina [Member]
 
Product Information [Line Items]
 
Number of stores
13 
South Dakota [Member]
 
Product Information [Line Items]
 
Number of stores
Tennessee [Member]
 
Product Information [Line Items]
 
Number of stores
10 
Texas [Member]
 
Product Information [Line Items]
 
Number of stores
75 
Utah [Member]
 
Product Information [Line Items]
 
Number of stores
11 
Virginia [Member]
 
Product Information [Line Items]
 
Number of stores
21 
Washington [Member]
 
Product Information [Line Items]
 
Number of stores
15 
West Virginia [Member]
 
Product Information [Line Items]
 
Number of stores
Wisconsin [Member]
 
Product Information [Line Items]
 
Number of stores
13 
Wyoming [Member]
 
Product Information [Line Items]
 
Number of stores
Summary of Significant Accounting Policies - Black-Scholes Valuation Model Weighted-Average Assumptions (Detail)
9 Months Ended
Nov. 1, 2014
Nov. 2, 2013
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
 
 
Volatility rate
40.80% 
49.60% 
Average risk-free interest rate
1.40% 
0.80% 
Average expected life (in years)
3 years 9 months 18 days 
4 years 4 months 24 days 
Dividend yield
   
   
Summary of Significant Accounting Policies - Additional Information (Detail) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Nov. 1, 2014
Nov. 2, 2013
Nov. 1, 2014
Nov. 2, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Compensation expenses
 
 
$ 11,436 
$ 11,936 
Employee Stock Option [Member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Number of shares granted
 
 
362 
286 
Weighted average fair value of stock option
 
 
$ 32.22 
$ 36.77 
Compensation expenses
2,386 
2,167 
6,990 
7,804 
Unrecognized compensation expense
19,286 
 
19,286 
 
Restricted Stock [Member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Number of shares granted
 
 
70 
139 
Compensation expenses
1,447 
2,230 
4,446 
4,132 
Unrecognized compensation expense
$ 9,526 
 
$ 9,526 
 
Commitments and Contingencies - Additional Information (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Nov. 1, 2014
Nov. 2, 2013
Nov. 1, 2014
Nov. 2, 2013
Commitments and Contingencies Disclosure [Abstract]
 
 
 
 
Non-cancelable operating lease terms, minimum
 
 
3 years 
 
Non-cancelable operating lease terms, maximum
 
 
10 years 
 
Total rent expense under operating leases
$ 40,840 
$ 36,897 
$ 118,319 
$ 102,837 
Notes Payable - Additional Information (Detail) (USD $)
9 Months Ended
Nov. 1, 2014
Feb. 1, 2014
Nov. 2, 2013
Line of Credit Facility [Line Items]
 
 
 
Letters of credit, maximum borrowing capacity
$ 200,000,000 
 
 
Additional credit available under the revolving facility with consent by each lender and other conditions
50,000,000 
 
 
Interest rate on outstanding borrowing under facility
Libor plus 1.50% 
 
 
Percentage of unused Line of Credit Facility Fee
0.20% 
 
 
Outstanding debt under credit facility
Subfacility for Standby Letters of Credit [Member]
 
 
 
Line of Credit Facility [Line Items]
 
 
 
Letters of credit, maximum borrowing capacity
$ 10,000,000 
 
 
Investments - Additional Information (Detail) (USD $)
In Thousands, unless otherwise specified
Nov. 1, 2014
Investments Schedule [Abstract]
 
Certificates of deposit
$ 50,000 
Time deposits
$ 50,000 
Fair Value Measurements - Additional Information (Detail) (Fair Value, Inputs, Level 2 [Member], USD $)
In Thousands, unless otherwise specified
Nov. 1, 2014
Fair Value, Inputs, Level 2 [Member]
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
Deferred compensation plan liability
$ 5,121 
Net Income Per Common Share - Net Income Per Basic and Diluted Share (Detail) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Nov. 1, 2014
Nov. 2, 2013
Nov. 1, 2014
Nov. 2, 2013
Earnings Per Share [Abstract]
 
 
 
 
Net income
$ 59,124 
$ 45,430 
$ 169,871 
$ 132,167 
Denominator for basic net income per share - weighted-average common shares
64,419 
64,061 
64,347 
63,912 
Dilutive effect of stock options and non-vested stock
319 
477 
308 
512 
Denominator for diluted net income per share
64,738 
64,538 
64,655 
64,424 
Net income per common share:
 
 
 
 
Basic
$ 0.92 
$ 0.71 
$ 2.64 
$ 2.07 
Diluted
$ 0.91 
$ 0.70 
$ 2.63 
$ 2.05 
Net Income Per Common Share - Additional Information (Detail)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Nov. 1, 2014
Nov. 2, 2013
Nov. 1, 2014
Nov. 2, 2013
Earnings Per Share [Abstract]
 
 
 
 
Antidilutive stock option excluded from computation of net income per common share
500 
254 
744 
669 
Share Repurchase Program - Additional Information (Detail) (USD $)
Share data in Thousands, except Per Share data, unless otherwise specified
9 Months Ended 3 Months Ended 9 Months Ended
Nov. 1, 2014
Nov. 2, 2013
Nov. 2, 2013
2013 Share Repurchase Program [Member]
Sep. 11, 2014
2013 Share Repurchase Program [Member]
Nov. 2, 2013
2013 Share Repurchase Program [Member]
Maximum [Member]
Nov. 1, 2014
2014 Share Repurchase Program [Member]
Nov. 1, 2014
2014 Share Repurchase Program [Member]
Sep. 11, 2014
2014 Share Repurchase Program [Member]
Maximum [Member]
Share Repurchase Program [Line Items]
 
 
 
 
 
 
 
 
Repurchase of common stock authorized amount
 
 
 
 
$ 150,000,000 
 
 
$ 300,000,000 
Repurchase of common stock, shares
 
 
501 
 
 
86 
86 
 
Repurchase of common stock
9,972,000 
37,337,000 
37,337,000 
 
 
9,972,000 
9,972,000 
 
Repurchase of common stock, average price per share
 
 
$ 74.58 
 
 
$ 116.09 
$ 116.09 
 
Shares authorized but unused amount revoked
 
 
 
$ 112,664,000