Sportsman’s Warehouse Holdings, Inc. reported that fiscal first-quarter net sales were $309.5 million for the 13-week period ended April 30, 2022, a decrease of 5.3 percent compared to the $327.0 million year-ago period. Adjusted diluted earnings per share were 5 cents compared to adjusted diluted earnings per share of 28 cents for the comparable 2021 quarter.

“Our first-quarter results were highlighted by strong performances in our hunting and shooting sports, apparel and footwear categories,” said Jon Barker, Sportsman’s Warehouse CEO. “The in-stock levels for ammunition continue to improve, driving traffic online and in our stores. We added three new stores to our fleet during the quarter and, just last week, celebrated the grand opening of our new spike camp store in Riverton, WY. This now brings the total number of stores in our fleet to 126 across the U.S.”

Barker continued, “We continue to closely monitor the impact of the current macro-economic environment on consumer behavior. Our broad assortment across multiple categories of product provides us with the ability to serve the changing needs of the consumer. With our position as the value-price leader in our industry, and with our growing omnichannel presence, we remain confident in our ability to serve the customer who is seeking the brands and equipment needed to enjoy the outdoors.”

SPWH said the net sales decrease for the period was primarily due to lower sales demand across all product categories as “we anniversaried the increased demand during the first fiscal quarter of 2021 driven by the COVID-19 economic stimulus package (the American Rescue Plan) and social unrest.” The retailer said this increase was partially offset by the addition of 13 new stores since May 1, 2021, which contributed $20.0 million in revenue to the current quarter.

Same-store sales decreased 11.6 percent during the first quarter of 2022 compared to the first quarter of 2022, primarily driven by a decrease in demand across all product categories due to the tough year-over-year comparison as described above.

Gross profit was $99.1 million, or 32.0 percent of net sales, compared to $104.0 million, or 31.8 percent of net sales, in the comparable prior-year period. The 20-basis point improvement as a percentage of net sales can be attributed to a favorable product sales mix and higher product margins, partially offset by higher overall transportation costs.

SG&A expenses increased 6.3 percent to $96.1 million, compared to $90.4 million in the first quarter of fiscal year 2021. This increase resulted from a return to pre-pandemic levels of marketing and travel activities, the timing of new store openings, and higher depreciation, payroll and rent expense.

Net income was $2.0 million, compared to a net income of $10.5 million in the first quarter of 2021. Adjusted net income was $2.2 million compared to an adjusted net income of $12.5 million in the first quarter of 2021. Adjusted EBITDA was $12.9 million, compared to $23.5 million in the comparable prior-year period.

Diluted earnings per share were 5 cents compared to diluted earnings per share of 23 cents in the comparable prior-year period. Adjusted diluted earnings per share were 5 cents compared to adjusted diluted earnings per share of 28 cents for the comparable prior-year period.

The company ended the first quarter with net debt of $40.8 million, comprised of $98.5 million of borrowings outstanding under the company’s revolving credit facility and $57.7 million of cash on hand.

Total liquidity was $168.2 million as of the end of the first quarter, comprised of $110.5 million of availability on the revolving credit facility, which does not give effect to the amended credit agreement entered into after the end of the first quarter, and $57.7 million of cash on hand.

On May 27, 2022, the company and subsidiaries, each as borrowers or guarantors, amended and restated the Credit Agreement governing the revolving credit facility with a consortium of banks led by Wells Fargo. The Amended Credit Agreement, among other things, increased the maximum borrowing capacity under the revolving credit facility from $250.0 million to $350.0 million, subject to a borrowing base calculation, extended the maturity date from May 23, 2023 to May 27, 2027 and replaced LIBOR with Term SOFR as the benchmark interest rate and made certain related conforming changes.

“The increased capacity of our revolving credit facility is reflective of the growth and health of our business and gives us additional flexibility to execute on our growth initiatives,” said Jeff White, CFO, Sportsman’s Warehouse. “We appreciate the continued support from our lending partners as we further expand our business and grow our store footprint.

For the second quarter of fiscal year 2022, net sales are expected to be in the range of $330 million to $350 million, anticipating that same-store sales will be down 16 percent to 10 percent year-over-year. Adjusted diluted earnings per share for the quarter are expected to be in the range of $0.22 to $.030.

Photo courtesy Sportsmans Warehouse