Cabela’s Anticipates Flat Q3 Income on Negative Comps…

Cabela’s sales and earnings were impacted by the Hurricanes hitting the Gulf Coast, the resulting higher energy prices, and the effect this is having on consumer spending. Third quarter fiscal 2005 revenues are expected to increase 12% with diluted EPS “at or slightly below” the same period last year, when CAB reported diluted EPS of 25 cents.

The company anticipates that direct revenue will be equal to last year’s levels while total retail revenue is expected to increase roughly 23% and same store sales are expected to decrease in the range of 8% – 9%. Financial services revenue is forecasted to increase approximately 46% for the third quarter of fiscal 2005.

At the end of Q2, Cabela’s management said they were confident in achieving “mid-teens” growth rates in both sales and earnings. Currently the company seems to still be on-track towards these results.

Dennis Highby, Cabela's president and CEO, said “Including the impact of the third quarter, for the nine months ended October 1, 2005, we continue to achieve results consistent with our long-term growth objectives. For the nine month period, consolidated revenues will increase approximately 15%, while consolidated net income is expected to increase approximately 13%.”

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Teresa Hartford

Teresa Hartford Editorial & Creative Director | SGB Media teresa@sgbonline.com | 704.651.5741

Cabela’s Anticipates Flat Q3 Income on Negative Comps

For the third quarter of fiscal 2005, Cabela's expects to report a 12% increase in consolidated revenues with diluted earnings per share at or slightly below the same period last year, which was an exceptionally strong quarter. For the third quarter of fiscal 2004, the Company reported diluted earnings per share of $0.25 and a 61% increase in net income due primarily to strength in the Company's retail division. The Company anticipates that direct revenue will be equal to a year ago levels while total retail revenue is expected to increase roughly 23% and same store sales are expected to decrease in the range of 8% – 9%. The Company also stated that financial services revenue is forecasted to increase approximately 46% for the third quarter of fiscal 2005.

Dennis Highby, Cabela's President and Chief Executive Officer, commented, “During the quarter, both our direct and retail businesses were impacted by higher fuel prices that resulted in both lower consumer spending and lower gross margins. Additionally, our direct revenue was impacted by the devastating damage to Louisiana, Mississippi, Alabama, Texas and Florida and the brief, but dramatic, impact of customers focusing on 'hurricane news' rather than spending. Including the impact of the third quarter, for the nine months ended October 1, 2005, we continue to achieve results consistent with our long-term growth objectives. For the nine month period, consolidated revenues will increase approximately 15%, while consolidated net income is expected to increase approximately 13%.”

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