Sportsman’s Warehouse widened the company’s loss slightly in the first-quarter, but both the loss and sales came in at the high end of expectations. Same-store sales were up 3.4 percent in the quarter ended May 5.

Jon Barker, chief executive officer, stated, “We are excited with the start to the fiscal year as our top and bottom line results for the first quarter came in at the high end of our expectations. Our topline was driven by strong new store performance and comp growth of 3.4 percent, which, when combined with consistent gross margins and disciplined cost control, resulted in bottom line performance at the high end of our outlook. We continued to make progress against each of our strategic initiatives, including our comprehensive omni-channel strategy, which includes growth of brick & mortar as well as e-commerce, customer acquisition and engagement and merchandising assortment. We look forward to building on this progress throughout fiscal 2018 and strengthening our competitive positioning.”

Barker added, “We are also very pleased to announce today the amendment and restatement of our credit agreement. We increased our borrowing capacity to $250 million under our revolving credit facility and added a new $40 million term loan. We used proceeds from our revolving credit facility and new term loan to repay our prior term loan, which we expect to reduce our interest expense by approximately $4.5 million on an annualized basis, as we focus on managing our capital structure through continued collaboration with our lenders.”

For the thirteen weeks ended May 5, 2018:

  • Net sales increased by 14.8 percent to $180.1 million from $156.9 million in the first quarter of fiscal year 2017. Same store sales increased by 3.4 percent from the comparable prior year period.
  • Loss from operations was $3.7 million compared to $3.8 million in the first quarter of fiscal year 2017. Adjusted loss from operations, which excludes charges incurred in conjunction with the retirement of the company’s former CEO, was $1.0 million, compared to adjusted loss from operations, which excludes professional and other fees incurred in connection with evaluation of a strategic acquisition, of $2.0 million for the first quarter of fiscal year 2017 .
  • The company opened two new stores in the first quarter of fiscal 2018 and ended the quarter with 89 stores in 22 states, or square footage growth of 8.9 percent, from the end of the first quarter of fiscal year 2017.
  • Interest expense increased to $3.6 million from $3.2 million in the first quarter of fiscal year 2017.
  • Net loss was $5.8 million compared to net loss of $4.5 million in the first quarter of fiscal year 2017. Adjusted net loss, which excludes charges incurred in conjunction with the retirement of the company’s former CEO, was $3.6 million compared to adjusted net loss, which excludes professional and other fees incurred in connection with evaluation of a strategic acquisition, of $3.4 million for the first quarter of fiscal year 2017.
  • Diluted loss per share was $(0.14) compared to $(0.11) in the first quarter of fiscal year 2017. Adjusted diluted loss per share was $(0.08) compared to $(0.08) in the first quarter of fiscal year 2017.
  • Adjusted EBITDA was $4.8 million compared to $4.2 million in the first quarter of fiscal year 2017 .

When it released fourth-quarter results on March 28, Sportsman’s Warehouse said it expected sales in the first quarter to be in the range of $173.0 million to $180.0 million based on a same store sales increase in the range of 2.0 percent to 6.0 percent. Adjusted net income is expected to be in the range of from a loss of $3.6 million to $4.6 million with adjusted loss per share of 8 to 11 cents.

Second Quarter and Fiscal Year 2018 Outlook

For the second quarter of fiscal year 2018, net sales are expected to be in the range of $199.0 million to $206.0 million based on a same store sales increase in the range of (2.0) percent to 2.0 percent compared to the corresponding period of fiscal year 2017. Adjusted net income is expected to be in the range of $5.9 million to $7.1 million, with adjusted diluted earnings per share of 14 cents to 17 cents on a weighted average of approximately 43.0 million estimated common shares outstanding.

For fiscal year 2018, net sales are expected to be in the range of $837.0 million to $860.0 million based on same store sales in the range of (1.0 percent) to 2.0 percent compared to fiscal year 2017. Adjusted net income is expected to be in the range of $23.8 million to $27.6 million with adjusted earnings per diluted share of $0.55 to $0.64 on a weighted average of approximately 43.0 million estimated common shares outstanding, when adjusted for the one-time expense incurred in connection with the announcement of the retirement of the company’s former chief executive Officer, John Schaefer, in the first quarter of fiscal 2018.

Photo courtesy Sportsman’s Warehouse