DULUTH, Ga.—National Vision Holdings, Inc. (NVI) (NASDAQ: EYE) reported a sharp increase in sales, earnings and comp-store sales for the third quarter ended Oct. 2, 2021. The company cited growth of its store brands, continued comp-store gains, improved operating activity and a continued leverage of technology throughout its business. Emphasizing the impact of COVID-related store closures last year, and consistent with NVI's second quarter earnings release, the report issued yesterday includes a comparison of fiscal 2021 results to fiscal 2019 pre-COVID results, in addition to a condensed comparison to fiscal 2020.

“We are pleased with our third quarter results, as sales remained healthy with total sales up nearly 20 percent and comparable store sales up over 13 percent on a 2-year basis against 2019,” stated Reade Fahs, chief executive officer. “Additionally, despite Delta variant concerns and a decline from an elevated average ticket last year, we delivered a slight comp increase against 2020 on continued growth in customer transactions. All credit goes to the dedicated patient and customer care of the 2,000-plus optometrists and over 13,000 associates at National Vision who continue to successfully navigate the many challenges this environment throws our way.”
 
Fahs said, “During the quarter, we opened 14 stores and continue to be excited about our long-term opportunities for expansion and market share growth. Additionally, given our strong cash flows, we made a voluntary $50 million prepayment under our credit agreement earlier this week and today announced our board approved a $50 million stock repurchase program. Looking ahead, as sales trends and customer demand continue to normalize from record levels during the COVID-19 pandemic, we believe we remain in a position of strength to continue to deliver sustainable growth.”
 


Reade Fahs, chief executive officer, National Vision Holdings, Inc.
In the third quarter, NVI reported net revenue increased 19.9 percent to $518.0 million compared to the third quarter of 2019 and said that net revenue was positively impacted by 1.5 percent due to the timing of unearned revenue. Comparable store sales growth was 15.7 percent while adjusted comparable store sales growth was 13.3 percent.
 
During the third quarter of 2021, the company opened 14 new stores, closed one store, and ended the quarter with 1,262 stores. Overall, store count grew 10.2 percent from Sept. 28, 2019 to Oct. 2, 2021. Costs applicable to revenue increased 10.7 percent to $226.5 million compared to the third quarter of 2019. As a percentage of net revenue, costs applicable to revenue decreased 360 basis points to 43.7 percent compared to the third quarter of 2019. This decrease as a percentage of net revenue was primarily driven by lower growth in optometric-related costs, increased eyeglass mix and higher eyeglass margin, the company reported.
 
Net income increased 3,339 percent to $41.0 million compared to the third quarter of 2019. Adjusted operating Income increased 110 percent to $54.7 million compared to the third quarter of 2019. Third quarter 2021 compared to third quarter 2020 reflected net revenue increasing 6.7 percent to $518.0 million. Comparable store sales growth was 3.4 percent. Net income increased 16.2 percent to $41.0 million compared to the third quarter of 2020.
 
For the nine months, NVI's net revenue increased 21.1 percent to $1.6 billion compared to the same period of 2019. Comparable store sales growth was 15.5 percent compared to 2019. The company opened 59 new stores, closed two stores, and ended the period with 1,262 stores. Net income increased 323 percent to $122.0 million compared to the same period of 2019.
 
Compared to 2020 for the same nine-month period, NVI's net revenue increased 31.8 percent to $1.6 billion compared to the same period of 2020 and comparable store sales growth was 30.3 percent. Net income increased 10,086 percent to $122.0 million compared to the same period of 2020.
 
The company’s cash balance was $439.1 million as of Oct. 2, 2021 and the company had no borrowings under its $300 million first lien revolving credit facility, exclusive of letters of credit of $6.4 million. Total debt was $620.0 million as of Oct. 2, 2021, consisting of outstanding first lien term loans, convertible senior notes (“2025 Notes”) and finance lease obligations, net of unamortized discounts.

Cash flows from operating activities for the first nine months of 2021 were $233.8 million compared to $203.7 million for the same period of 2020 and $170.9 million for the same period of 2019.

Capital expenditures for the first nine months of 2021 totaled $58.9 million compared to $40.8 million for the same period of 2020 and $76.5 million for the same period of 2019.
 
In addition effective Nov. 8, 2021, the company's board of directors authorized the company to repurchase up to $50 million aggregate amount of shares of the company's common stock. Under the share repurchase program, shares may be repurchased from time to time in the company's discretion through Dec. 30, 2023 using a variety of methods.
 
On Nov. 9, 2021, the company voluntarily prepaid $50 million in existing Term A loans under its credit agreement.

National Vision updated its fiscal 2021 outlook  which reflects the currently expected impacts related to COVID-19, however, the ultimate impacts of COVID-19 on the company’s financial outlook remain uncertain. The company provided an updated outlook for the 52 weeks ending Jan. 1, 2022 of net revenue of $2.04 billion to $2.06 billion, adjusted operating income of $180 million to $187 million and anticipates having opened an additional 75 stores.
 
National Vision Holdings, Inc. states that it is the second largest optical retail company in the U.S. (by sales) with more than 1,200 retail stores in 44 states and Puerto Rico. It operates five retail brands: America’s Best Contacts & Eyeglasses, Eyeglass World, Vision Centers inside select Walmart stores, and Vista Opticals inside select Fred Meyer stores and on select military bases, and several e-commerce websites, offering a variety of products and services for
customers’ eyecare needs. 
 
As VMAIL reported, National Vision issued its first Corporate Responsibility Report earlier this year and for the second year in a row was just recognized by Forbes as one of its 2021 Best Employers for Veterans.