Ulta 2012 Annual Report Download - page 25

financial and managerial controls, reporting systems and procedures and have incurred and will continue to incur
expenses to test our systems and to make such improvements. If our management is unable to certify the
effectiveness of our internal controls or if our independent registered public accounting firm cannot render an
opinion on the effectiveness of our internal control over financial reporting, or if material weaknesses in our
internal controls are identified, we could be subject to regulatory scrutiny and a loss of public confidence, which
could have a material adverse effect on our business and our stock price. In addition, if we do not maintain
adequate financial and management personnel, processes and controls, we may not be able to accurately report
our financial performance on a timely basis, which could cause a decline in our stock price and adversely affect
our ability to raise capital.
The market price for our common stock may be volatile, and an investor may not be able to sell our stock at a
favorable price or at all.
The market price of our common stock is likely to fluctuate significantly from time to time in response to factors
including:
‰differences between our actual financial and operating results and those expected by investors;
‰fluctuations in quarterly operating results;
‰our performance during peak retail seasons such as the holiday season;
‰market conditions in our industry and the economy as a whole;
‰changes in the estimates of our operating performance or changes in recommendations by any research
analysts that follow our stock or any failure to meet the estimates made by research analysts;
‰investors’ perceptions of our prospects and the prospects of the beauty products and salon services
industries;
‰the performance of our key vendors;
‰announcements by us, our vendors or our competitors of significant acquisitions, divestitures, strategic
partnerships, joint ventures or capital commitments;
‰introductions of new products or new pricing policies by us or by our competitors;
‰stock transactions by our principal stockholders;
‰recruitment or departure of key personnel; and
‰the level and quality of securities research analyst coverage for our common stock.
In addition, public announcements by our competitors, other retailers and vendors concerning, among other
things, their performance, strategy, or accounting practices could cause the market price of our common stock to
decline regardless of our actual operating performance.
Our comparable store sales and quarterly financial performance may fluctuate for a variety of reasons, which
could result in a decline in the price of our common stock.
Our comparable store sales and quarterly results of operations have fluctuated in the past, and we expect them to
continue to fluctuate in the future. A variety of other factors affect our comparable store sales and quarterly
financial performance, including:
‰general U.S. economic conditions and, in particular, the retail sales environment;
‰changes in our merchandising strategy or mix;
‰performance of our new and remodeled stores;
‰the effectiveness of our inventory management;
‰timing and concentration of new store openings, including additional human resource requirements and
related pre-opening and other start-up costs;
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