Dick’s Sporting Goods Q3 net sales rise 9 percent

REPORT_ Dick’s Sporting Goods Company reported consolidated net income for the third quarter ended November 1, 2014 of 49.2 million dollars, or 0.41 dollars per diluted share, compared to the Company's expectations provided on August 19, 2014 of 0.38 dollars to 0.42 dollars per diluted share. Net sales increased 9 percent to approximately 1.5 billion dollars.

Consolidated same store sales increased 1.1 percent, compared to the Company's guidance of an approximate 1 to 3 percent increase. Same store sales for Dick’s Sporting Goods increased 1.7 percent, while Golf Galaxy decreased 8.9 percent. Third quarter 2013 consolidated same store sales increased 3.3 percent, adjusted for the shifted retail calendar due to the 53rd week in 2012.

“Our third quarter earnings were at the higher end of our guidance, but continued pressures in golf and hunting kept our comp sales at the lower end of our expectations,” said Edward W. Stack, Chairman and CEO, adding, “The balance of our business, excluding golf and hunting, continued to deliver strong results, posting a 4.6 percent comp increase for the quarter. The performance in these other categories, such as women's and youth apparel are good indicators that our recent actions to reallocate space and payroll within our stores are paying off.”

E-commerce penetration for the third quarter of 2014 was 7.3 percent of total sales, compared to 6.5 percent in the third quarter last year. In the third quarter, the Company opened 24 new Dick’s Sporting Goods stores, one new Golf Galaxy store and seven new Field & Stream stores. The Company also relocated one Dick’s Sporting Goods store and one Golf Galaxy store, remodeled five Dick’s Sporting Goods stores and closed one Dick’s Sporting Goods store. As of November 1, 2014, the Company operated 597 Dick’s Sporting Goods stores in 46 states and 80 Golf Galaxy stores in 29 states.

In the beginning of the fourth quarter, the Company opened six new Dick’s Sporting Goods stores, completing its 2014 store development program. The Company opened a total of 45 net new Dick’s Sporting Goods stores, one new Golf Galaxy store and eight new Field & Stream stores. The Company also relocated five Dick’s Sporting Goods stores and two Golf Galaxy stores and remodeled five Dick’s Sporting Goods stores in 2014. The Company also plans to close two Golf Galaxy stores that are at the end of their leases during the fourth quarter.

The Company reported consolidated non-GAAP net income for the 39 weeks ended November 1, 2014 of 192.2 million dollars, or 1.58 dollars per diluted share. For the 39 weeks ended November 2, 2013, the Company reported consolidated non-GAAP net income of 199.3 million dollars, or 1.59 dollars per diluted share. On a GAAP basis, the Company reported consolidated net income for the 39 weeks ended November 1, 2014 of 188.7 million dollars, or 1.55 dollars per diluted share. For the 39 weeks ended November 2, 2013, on a GAAP basis, the Company reported consolidated net income of 199 million dollars, or 1.58 dollars per diluted share.

Net sales for the 39 weeks ended November 1, 2014 increased 9.1percent from last year's period to 4.7 billion dollars due to the opening of new stores coupled with a consolidated same store sales increase of 2 percent. Now based on an estimated 121 million diluted shares outstanding, the Company anticipates reporting consolidated non-GAAP earnings per diluted share of approximately 2.75 dollars to 2.85 dollars, excluding a gain on the sale of an asset and golf restructuring charges. For the 52 weeks ended February 1, 2014, the Company reported consolidated earnings per diluted share of 2.69 dollars. Consolidated same store sales are now expected to increase approximately 1 to 2 percent, compared to a 1.9 percent increase in fiscal 2013.

For the fourth quarter, based on an estimated 120 million diluted shares outstanding, the Company expects reporting consolidated earnings per diluted share of approximately 1.18 dollars to 1.28 dollars, compared to consolidated earnings per diluted share of 1.11 dollars in the fourth quarter of 2013. Consolidated same store sales are currently expected to increase approximately 1 to 3 percent in the fourth quarter of 2014, as compared to a 7.3 percent increase in the fourth quarter of 2013, adjusted for the shifted retail calendar due to the 53rd week in 2012.