Ulta Beauty will start opening stores in Canada, with plans to establish itself as a global brand.
“While we have years of attractive domestic growth ahead of us, we’ve been evaluating the potential for growth beyond the U.S. borders for some time,” said Mary Dillon, CEO of Ulta Beauty in its first quarter earnings call.
Dillon said international expansion represents an attractive and incremental long-term growth platform, which extends its core capabilities and leverages the brand’s value proposition.
“Over the past few years, we’ve extensively studied the market opportunity in multiple countries and evaluated various operational models,” said Dillon. “We believe that the Ulta Beauty value proposition is very relevant and differentiated in multiple geographies around the globe.”
Dillon said Canada is a logical place to start, opening stores and selling through ecommerce. While she didn’t share a lot of details, Dillon did say Ulta plans to start small while being ready to scale quickly as it learns and sees success.
“The startup investment to support the Canada launch is expected to put modest pressure on the P&L this year, but we still expect to deliver financial results within our guidance range,” she said. “Our Canadian business is not expected to be material to sales or income for the next few years as we thoughtfully build a foundation to become a global beauty retailer over the long term.”
Ulta Beauty reported a net sales increase of 12.9% to $1.74 billion in the quarter. While it didn’t break out ecommerce, the company did say online sales were up between 20% and 30%.