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Dick's Sporting Goods' Q3 net income declines to 36.9 mn dollars

Dick’s Sporting Goods reported consolidated net income for the third quarter ended October 28, 2017 of 36.9 million dollars or 0.35 dollar per diluted share compared to 48.9 million dollars or 0.44 dollars per diluted share. On a non-GAAP basis, consolidated net income was 31.9 million dollars or 0.30 dollar per diluted share compared to 53.6 million dollars or 0.48 dollar per diluted share last year.

"In the third quarter, we delivered earnings per diluted share and comp sales at the high end of our expectations, with continued double-digit growth in ecommerce. As expected, margins were under pressure in this highly promotional environment, but our strategy for this environment enabled us to continue to capture market share," said Edward W. Stack, Chairman and Chief Executive Officer in a media release.

Q3 net sales increase 7.4 percent

Net sales for the third quarter increased 7.4 percent to approximately 1.94 billion dollars and consolidated same store sales decreased 0.9 percent, compared to the company's guidance of a low single-digit decrease. Third quarter 2016 consolidated same store sales had increased 5.2 percent.

The company said ecommerce sales increased approximately 16 percent and ecommerce penetration for the quarter was 10.3 percent of total net sales, compared to 9.6 percent during the third quarter of 2016. In the third quarter, the company opened 15 new Dick’s Sporting Goods stores and six new Field & Stream stores. The company also closed two specialty concept stores. As of October 28, 2017, the company operated 719 Dick’s Sporting Goods stores in 47 states, 98 Golf Galaxy stores in 32 states and 35 Field & Stream stores in 16 states.

Year to date

The company reported consolidated net income for the 39 weeks ended October 28, 2017 of 207.5 million dollars or 1.91 dollars per diluted share compared to 197.2 million dollars or 1.75 dollars per diluted share. On a non-GAAP basis, the consolidated net income was 197 million dollars or 1.81 dollars per diluted share compared to 201.9 million dollars or 1.80 dollars per diluted share, excluding conversion costs for former TSA stores.

Net sales for the period increased 9 percent to approximately 5.93 billion dollars, reflecting the growth of the company’s store network and a 0.5 percent increase in consolidated same store sales.

Expects lower same-store sales growth in FY17

For the fiscal year 2017, based on an estimated 107 to 108 million diluted shares outstanding, the company currently anticipates reporting earnings per diluted share in the range of 2.95 dollars to 3.07 dollars, which includes approximately 0.05 dollar per diluted share for the 53rd week. Non-GAAP earnings per diluted share are expected to be in the range of 2.92 dollars to 3.04 dollars.

Consolidated same store sales are currently expected to be in the range of approximately flat to a low single-digit decline on a 52 week to 52 week comparative basis, compared to an increase of 3.5 percent in 2016.

For the fourth quarter, based on an estimated 105 million diluted shares outstanding, the company currently anticipates reporting earnings per diluted share in the range of 1.05 dollars to 1.17 dollars compared to 0.81 dollars reported in the fourth quarter of 2016. Non-GAAP earnings per diluted share are expected to be in the range of 1.12 dollars to 1.24 dollars compared to 1.32 dollars in the fourth quarter of 2016.

Consolidated same store sales are currently expected to decline in the low single-digits in the fourth quarter of 2017, compared to an increase of 5 percent in the fourth quarter of 2016.

The company expects to open 43 new Dick’s Sporting Goods stores and relocate seven Dick’s Sporting Goods stores in 2017. The company also expects to open eight new Golf Galaxy stores, relocate one Golf Galaxy store and open eight new Field & Stream stores adjacent to Dick’s Sporting Goods stores. These openings include former TSA and Golfsmith stores that the company converted to Dick’s Sporting Goods and Golf Galaxy stores, respectively. The Company expects to relocate one Dick’s Sporting Goods store in the fourth quarter of 2017.

Picture:Facebook/Golf Galaxy