Sportsman’s Warehouse Holdings, Inc. (Nasdaq:SPWH) grew sales 13.7 percent to $189.8 million in the second quarter ended July 30 thanks to the opening of three new stores and a 2.9 percent increase in same-store sales.
The Midvale, Utah-based hook-and-bullet retailer reported operating income dipped 0.7 percent to $16.7 million. Adjusted income from operations, which excludes the reversal of an accrual related to litigation in the second quarter of 2015, was $16.7 million as compared to $12.8 million in the second quarter of fiscal year 2015, an increase of 30.4 percent.
Net income inched up 1.3 percent to $8.3 million, while adjusted net income rose 44.7 percent to $8.3 million compared to for the second quarter of fiscal year 2015. Diluted earnings per share rose 5.3 percent, or 42.9 percent on an adjusted basis. Adjusted EBITDA was $22.3 million compared to $17.3 million in the second quarter of fiscal year 2015.
“We are pleased with our second quarter results which came in above our guidance on both the top and bottom line,” said President and CEO John Schaefer. “Our strong performance is a testament to the differentiating attributes of our business model, including our value proposition that resonates with our customers, driving the appeal of Sportsman’s Warehouse. Our everyday low pricing, best-in-class customer service and our flexible store layout give us the ability to profitably operate in both smaller and larger markets and continue to grow market share. These characteristics coupled with the disciplined execution of our growth strategies continue to drive our operational and financial performance.”
The company ended the quarter with total debt of $201.1 million, including $66.1 million outstanding under the company’s revolving credit facility and $135.0 million outstanding under the term loan, net of unamortized discount and debt issuance costs. That compared to $198.6 million at the end of the first quarter of 2016. Total liquidity (cash plus $44.9 million of availability on revolving credit facility): $47.5 million
Third Quarter and Fiscal Year 2016 Outlook:
Sportman’s Warehouse expects net sales to be in the range of $212.0 million to $217.0 million for the third quarter of fiscal year 2016 based on same store sales change in the range of 2.0 percent to 4.0 percent compared to the corresponding period of fiscal year 2015. Net income is expected to be in the range of $9.8 million to $11.1 million, with diluted earnings per share of $0.23 to $0.26 on approximately 42.6 million estimated weighted average common shares outstanding. Adjusted net income is expected to be in the range of $9.8 million to $11.1 million, with adjusted diluted earnings per share of $0.23 to $0.26 on approximately 42.6 million estimated weighted average common shares outstanding.
For fiscal 2016, net sales are expected to be in the range of $780.0 million to $790.0 million based on opening 11 new stores for the full year and same store sales change in the range of 0.0 percent to 2.0 percent compared to fiscal year 2015. Net income is expected to be in the range of $30.1 million to $32.6 million, with diluted earnings per share of $0.71 to $0.77. Adjusted net income is expected to be in the range of $29.6 million to $32.1 million, with adjusted diluted earnings per share of $0.70 to $0.76 (see “GAAP and Non-GAAP Measures”) on approximately 42.5 million estimated weighted average common shares outstanding.
