RH posted a 78.3% increase in revenues in the first quarter of 2021, prompting CEO Gary Friedman to adjust fiscal forecasts to reflect the heightened trajectory.
“While fiscal 2021 will surely be a tale of two halves, there are many data points that lead us to feel optimistic that our strong performance will continue through the second half of 2021 with growth reaccelerating in fiscal 2022 and beyond,” Friedman wrote in a letter to shareholders. “These include a strong housing and renovation market, both with pent up demand and a long tail, a record stock market, low interest rates and the reopening of several large parts of our economy. Additionally, the un-masking of the general public could lead to a Roaring Twenties type of consumer exuberance.”
The retailer posted $860.8 million in revenues in the first quarter, up from $482.9 million in the same quarter a year ago.
Net income increased to $130.7 million in the quarter vs. a $3.2 million loss in the first quarter of FY 2020. First quarter adjusted net income rose 375% to $142.3 million in the quarter vs. $29.9 million in the same time frame last year. Earnings per share rose to $4.19 compared with a loss of 17 cents in the year-ago period.
With the increases noted, Friedman adjusted RH’s projected revenue growth for FY 2021 to 25% to 30%, up from the prior outlook of 15% to 20% growth. Also, he reported that the retailer expects to be debt free by the end of the year.
“We enter this new decade with a compelling vision for the future, a team passionate about bringing that vision to life, and the strongest brand and business model in our industry,” Friedman wrote. “We plan to launch an unimaginable amount of innovative new strategies designed to further elevate and expand the RH brand.
“As I did in my recent annual shareholder letter, I will outline the strategic separation we’ve created and the strategies we are pursuing as we continue our quest to become one of the most admired brands in the world.”