Dick's Sporting Goods posts positive Q1 results

Dick's Sporting Goods has reported positive first quarter results and have raised their full year guidance. The company reported consolidated net income for the first quarter ended May 4, 2019 of 57.5 million dollars, or 61 cents per diluted share. The company reported consolidated net income for the first quarter ended May 5, 2018 of 60.1 million dollars, or 59 cents per diluted share.

On a non-GAAP basis, the company reported consolidated net income for the first quarter ended May 4, 2019 of 58.4 million dollars, or 62 cents per diluted share. First quarter 2019 non-GAAP results exclude a non-cash asset impairment and the settlement of a litigation contingency. The GAAP to non-GAAP reconciliation is included in a table later in the release under the heading "GAAP to Non-GAAP Reconciliation."

Net sales for the first quarter of 2019 increased 0.6 percent to approximately 1.92 billion dollars. Consolidated same store sales were flat. First quarter 2018 consolidated same store sales decreased 2.5 percent, adjusted for the calendar shift due to the 53rd week in fiscal 2017, which the company believes is the best view of its business.

"We were pleased with our start to 2019, delivering higher merchandise margins and first quarter earnings per diluted share above last year. Same store sales turned positive in March and remained positive in April, as we started to see the benefits of our key strategies and investments," said Edward W. Stack, chairman and CEO, in a statement. "We are very enthusiastic about our business and are pleased to increase our full year earnings outlook."

"During the first quarter, we made great progress in executing against our strategic priorities and investments as we remain focused on improving the in-store and online experience for our athletes and driving productivity improvements across our business," added Lauren R. Hobart, president of Dick's Sporting Goods, in a statement. "As we continue to build the best omni-channel experience in sporting goods, we see significant opportunity to drive competitive advantage in the marketplace and strengthen our leadership position."

Ecommerce is also becoming a key component of the company's business. Ecommerce sales for the first quarter of 2019 increased 15 percent. Ecommerce penetration for the first quarter of 2019 was approximately 13 percent of total net sales, compared to approximately 11 percent during the first quarter of 2018. On the brick-and-mortar front, in the first quarter, the company opened one new Golf Galaxy store, relocated one Dick's Sporting Goods store, and closed two Dick's Sporting Goods stores. As of May 4, 2019, the company operated 727 Dick's Sporting Goods stores in 47 states, with approximately 38.6 million square feet, 95 Golf Galaxy stores in 32 states, with approximately 2.0 million square feet, and 35 Field & Stream stores in 16 states, with approximately 1.7 million square feet.

The company ended the first quarter of 2019 with approximately 92.4 million dollars in cash and cash equivalents and approximately 369.5 million dollars in outstanding borrowings under its revolving credit facility. Over the course of the last 12 months, the company continued to invest in omni-channel growth, while returning over 414 million dollars to shareholders through share repurchases and quarterly dividends.

Total inventory increased 16.2 percent at the end of the first quarter of 2019 as compared to the end of the first quarter of 2018. This planned increase was due primarily to strategic investments to support key growth categories.

photo: via dickssportinggoods.com