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Ulta Beauty Inc. (NASDAQ:ULTA)

This company has been moved to the archive! The financial data has not been updated since August 24, 2023.

Common-Size Balance Sheet: Liabilities and Stockholders’ Equity

Ulta Beauty Inc., common-size consolidated balance sheet: liabilities and stockholders’ equity

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Jan 28, 2023 Jan 29, 2022 Jan 30, 2021 Feb 1, 2020 Feb 2, 2019 Feb 3, 2018
Accounts payable 10.42 11.60 9.37 8.51 12.66 11.20
Accrued payroll, bonus, and employee benefits 3.42 3.32 2.83 1.59 3.01 2.84
Accrued taxes 1.10 0.91 0.72 0.80 1.01 0.97
Accrued capital expenditures 1.03 0.51 0.00 0.00 0.00 0.00
Accrued advertising 0.76 1.04 0.46 0.00 0.00 0.00
Other accrued liabilities 1.97 1.88 1.81 2.66 2.90 2.69
Accrued liabilities 8.27% 7.66% 5.82% 5.06% 6.91% 6.50%
Deferred revenue 7.35 7.42 5.39 4.88 6.24 3.89
Current operating lease liabilities 5.28 5.75 4.98 4.93 0.00 0.00
Accrued income taxes 0.00 0.27 0.84 0.00 0.00 0.48
Current liabilities 31.32% 32.70% 26.40% 23.38% 25.81% 22.08%
Non-current operating lease liabilities 30.16 33.01 32.29 34.93 0.00 0.00
Deferred rent 0.00 0.00 0.00 0.00 13.63 14.02
Deferred income taxes 1.03 0.83 1.28 1.84 2.63 2.04
Other long-term liabilities 1.00 1.23 0.75 0.75 0.89 0.86
Long-term liabilities 32.19% 35.07% 34.32% 37.51% 17.15% 16.93%
Total liabilities 63.51% 67.77% 60.72% 60.89% 42.96% 39.00%
Common stock, $0.01 par value 0.01 0.01 0.01 0.01 0.02 0.02
Treasury stock-common, at cost -1.13 -1.12 -0.74 -0.71 -0.78 -0.65
Additional paid-in capital 19.07 19.62 16.65 16.60 23.15 24.03
Retained earnings 18.54 13.71 23.37 23.20 34.65 37.59
Accumulated other comprehensive income 0.00 0.00 0.00 0.00 0.00 0.00
Stockholders’ equity 36.49% 32.23% 39.28% 39.11% 57.04% 61.00%
Total liabilities and stockholders’ equity 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%

Based on: 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03).

An analysis of the common-size balance sheet reveals a significant structural shift in the financing mix between 2018 and 2023. The most prominent trend is the substantial increase in total liabilities relative to total assets, rising from 39.00% in 2018 to 63.51% by 2023, accompanied by a corresponding decline in stockholders' equity from 61.00% to 36.49% over the same period.

Liability Structure and Lease Accounting
A critical inflection point occurred in 2020, characterized by the elimination of deferred rent (which stood at 13.63% in 2019) and the introduction of operating lease liabilities. Non-current operating lease liabilities surged to 34.93% in 2020, remaining a dominant component of the balance sheet through 2023 at 30.16%. This transition suggests a change in accounting standards for lease recognition, which significantly inflated the total liability profile.
Current Operational Liabilities
Current liabilities exhibited a general upward trend, increasing from 22.08% in 2018 to 31.32% in 2023. Within this category, deferred revenue grew from 3.89% to 7.35%, indicating a rise in prepaid customer obligations. Accrued liabilities also saw a steady increase, moving from 6.50% to 8.27%, driven largely by increases in accrued payroll, bonus, and employee benefits.
Stockholders' Equity Trends
Equity components experienced a marked contraction. Retained earnings, once the largest single component of the balance sheet at 37.59% in 2018, declined sharply to a low of 13.71% in 2022 before recovering slightly to 18.54% in 2023. This suggests that dividends or share repurchases may have offset a portion of the retained earnings growth.
Treasury Stock and Paid-in Capital
The negative impact of treasury stock on total equity deepened from -0.65% in 2018 to -1.13% in 2023, reflecting ongoing share buyback activity. Additional paid-in capital remained relatively volatile, fluctuating between a high of 24.03% in 2018 and a low of 16.60% in 2020, ending at 19.07% in 2023.

In summary, the financial position has transitioned from an equity-funded model to one more heavily reliant on liabilities. While a significant portion of this shift is attributable to the accounting treatment of leases, the decline in retained earnings and the increase in treasury stock indicate a strategic shift in how capital is returned to shareholders relative to the total asset base.

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