BELLEVUE, Wash. - Savers Value Village, Inc. (NYSE: SVV), a leading thrift retailer with a market capitalization of $1.5 billion, disclosed its preliminary financial results for the fourth quarter and full fiscal year 2024 today, highlighting increased net sales and steady growth in the United States amidst economic challenges in Canada. According to InvestingPro analysis, the company appears undervalued based on its Fair Value metrics, with analysts seeing up to 39% upside potential. The company, which is set to participate in the ICR Conference next week, also confirmed its projected Adjusted EBITDA for fiscal 2024.
For the thirteen weeks ending December 28, 2024, Savers Value Village reported a 5.0% rise in net sales to $402.0 million, maintaining its impressive gross profit margin of 55%. When adjusted for currency fluctuations, sales saw a 6.0% increase to $405.9 million. Specifically, the U.S. market experienced a robust 10.5% growth, while Canada faced a slight 0.2% decline. Comparable store sales for the quarter were up 1.6%, with the U.S. climbing 4.7% and Canada decreasing by 2.5%. InvestingPro subscribers can access additional insights through the comprehensive Pro Research Report, which details the company's financial health and growth prospects.
Fiscal 2024 saw a 2.5% increase in net sales, reaching $1.54 billion. On a constant currency basis, the company's net sales were up 3.1% to $1.55 billion, with the U.S. market driving the growth at 6.7%, despite a 1.6% decrease in Canada. Comparable store sales for the year were virtually unchanged, dipping only 0.1%.
The preliminary results support the company's previously stated Adjusted EBITDA forecast, which is expected to be between $290 million and $300 million for fiscal 2024. Trading at a P/E ratio of 21.5, InvestingPro data shows the company is trading at an attractive valuation relative to its near-term earnings growth potential, with multiple ProTips indicating strong fundamentals.
CEO Mark Walsh expressed satisfaction with the company's performance, particularly the double-digit revenue increase in the U.S. He acknowledged the macroeconomic pressures in Canada but noted progress in that market. Looking ahead, Walsh shared plans for the opening of 25-30 new stores in 2025, in line with the company's expansion strategy.
Savers Value Village, known for its commitment to reuse and the #ThriftProud movement, operates as the largest for-profit thrift store chain in the U.S. and Canada, offering pre-owned clothing, accessories, and household goods.
The company's participation in the ICR Conference will include meetings with investors and a presentation by Walsh, CFO Michael Maher, and VP of Investor Relations Ed Yruma. The event will be webcast live for interested parties.
This financial update is based on a press release statement, and the figures presented are preliminary and unaudited. The company's final results will be available upon completion of the fiscal year-end financial review.
In other recent news, Savers Value Village has been grappling with significant developments. Piper Sandler downgraded the company's stock from Overweight to Neutral, citing gross margin pressures and disappointing sales trends projected through 2025. The firm also reduced its price target to $10, after the company's quarter results fell short of expectations.
In a similar vein, Goldman Sachs and JPMorgan lowered their ratings for Savers Value Village to Neutral, due to increasing market pressures within the Canadian sector and potential negative performance respectively. Despite these downgrades, Piper Sandler reaffirmed its Overweight rating on the company's shares, buoyed by the consistent popularity of secondhand shopping among teens.
Savers Value Village has also made strategic financial adjustments, adding a $50 million Incremental Revolving Facility to its existing credit agreement, thus providing additional liquidity. The company expanded its presence in the Southeast market through the acquisition of 2 Peaches Group.
Finally, the appointment of a new Chief Financial Officer, Michael Maher, has been viewed positively by analysts. These developments underscore the dynamic environment in which Savers Value Village operates, as it navigates persistent guidance misses and the evolving thrift retail landscape.
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