Big 5 Sporting Goods saw positive comp store performances in each of the ten states they do business, with total same-store sales for the company gaining 3.3% for the third quarter ended September 28, the companys 31st consecutive quarter for positive comps. The gain came on top of a 5.3% comp store sales increase in the year-ago period.
Sales in July comped up in the low single-digits and strengthened further in the August period before slowing a bit in September to the low- to mid-single digit range. The increases were characterized as primarily “traffic-driven”, as the average ticket rose just 1.0%.
Apparel, which makes up about 13% of annual sales, was again the hottest category, comping up in the high-single digits. Footwear, which is approximately 32% of the annual business, comped up. Hardgoods, which makes up the majority of the business with 55%, also comped up in the low- to mid-single digits range. The skate category was the only area that was identified as “soft”.
Company chairman, president & CEO Steven Miller said the improvements in sales trends since the first half of the year was “primarily a function of more normalized weather in our markets, as well as some indications of a healthier consumer environment.”
The gross margin gains were assisted by improved product margins from “opportunistic buys”. Miller said the buyers “do an outstanding job with supplying our stores with products that offer our customers tremendous and often compelling values.” He also pointed to a “better job in inventory control and distribution”, getting “the right products to the right stores in the right quantity at the right time” that results in fewer markdowns.
CFO Chuck Kirk pointed out that inventories “actually decreased 2.2%” on a per store basis to $632,000 at the end of the quarter from $646,000 per store at the end of the year-ago period.
The retailer added seven stores in the third quarter to a total of 282 doors. Miller said they opened three stores in October and expect to bow another eight by fiscal and calendar year-end for a total of 293 stores.
BGFV did provide guidance for the balance of the year, indicating that they “experienced some impact” from the SoCal fires, but saw “no material impact on the guidance” that suggests Q4 same-store sales growth in the low- to mid-single digit range and diluted EPS in the 44 cents to 48 cents range. Full year same-store sales estimates reflect a low-single digit increase, with earnings in the range of $1.21 to $1.25 per diluted share, up from the prior guidance of $1.18 to $1.23 per diluted share.
BGFV shares increased 10.3% for the week to close at $18.66 on Friday.
