Dick’s Sporting Goods reported earnings jumped 43.1 percent in the first quarter, to $37.5 million, or 30 cents a share, from $26.2 million, or 22 cents, a year ago. Revenues increased 6.3 percent to $1.11 billion from $1.05 billion. Same-store sales increased 2.1 percent. The company raised full year estimated earnings range from $1.89 to 1.91 per diluted share to $1.91 to 1.93 per diluted share
Results in the quarter exceeded the company’s earnings expectations provided on March 8, 2011 of 26 cents to 28 cents a share.
The 2.1 percent consolidated same store sales increase consisted of a 1.4 percent increase at Dick’s Sporting Goods stores, a 3.3 percent increase at Golf Galaxy and a 25.2 percent increase in its e-commerce business.
“In the first quarter, we demonstrated our ability to effectively run our business and generate better than expected earnings, despite unfavorable weather conditions in many of our markets,” said Edward W. Stack, chairman and CEO. “With several multi-year growth opportunities, a strong balance sheet, and a talented team of associates, we are optimistic about the near and long-term prospects of our business.”
New Stores
In the first quarter, the company opened three Dick’s Sporting Goods stores.
As of April 30, 2011, the company operated 447 Dick’s Sporting Goods stores in 42 states, with approximately 24.7 million square feet and 81 Golf Galaxy stores in 30 states, with approximately 1.3 million square feet.
Balance Sheet
The company ended the first quarter of 2011 with $533 million in cash and cash equivalents and did not have any outstanding borrowings under its $440 million Credit Agreement. At the end of the first quarter of 2010, the company had $207 million in cash and cash equivalents and did not have any outstanding borrowings under its credit facility.
The inventory per square foot was 0.6 percent higher at the end of the first quarter 2011 as compared to the end of the first quarter of 2010.
Current 2011 Outlook
Based on an estimated 126 million diluted shares outstanding, the company currently anticipates reporting consolidated earnings per diluted share of approximately $1.91 – 1.93. For the full year 2010, the company reported consolidated non-GAAP earnings per diluted share of $1.63, excluding Golf Galaxy store closing costs and litigation settlement costs. On a GAAP basis, the company reported consolidated earnings per diluted share of $1.50 in 2010.
Consolidated same store sales are currently expected to increase approximately 3.0 percent compared to a 7.4 percent increase last year.
The company currently expects to open approximately 34 new Dick’s Sporting Goods stores, remodel 14 Dick’s Sporting Goods stores, open approximately three Golf Galaxy stores and relocate one Golf Galaxy store in 2011.
Second Quarter 2011
Based on an estimated 126 million diluted shares outstanding, the Company currently anticipates reporting consolidated earnings per diluted share of approximately $0.47 – 0.49 in the second quarter of 2011. In the second quarter of 2010, the Company reported consolidated earnings per diluted share of $0.43.
Consolidated same store sales are currently expected to increase approximately 3.0 percent compared to a 5.7 percent increase in the second quarter last year.
The company expects to open approximately eight new Dick’s Sporting Goods stores and relocate one Golf Galaxy store in the second quarter of 2011.
Capital Expenditures
In 2011, the company anticipates capital expenditures to be approximately $252 million on a gross basis and approximately $197 million on a net basis.
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DICK’s SPORTING GOODS, INC. AND SUBSIDIARIES |
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CONSOLIDATED STATEMENTS OF INCOME – UNAUDITED |
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(In thousands, except per share data) |
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13 Weeks Ended |
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April 30, |
% of Sales (1) |
May 1, |
% of Sales (1) |
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2011 |
2010 |
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Net sales |
$ 1,113,849 |
100.00% |
$ 1,047,531 |
100.00% |
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Cost of goods sold, including occupancy |
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and distribution costs |
783,406 |
70.33 |
745,311 |
71.15 |
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GROSS PROFIT |
330,443 |
29.67 |
302,220 |
28.85 |
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Selling, general and administrative expenses |
263,735 |
23.68 |
253,149 |
24.17 |
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Pre-opening expenses |
2,266 |
0.20 |
2,079 |
0.20 |
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INCOME FROM OPERATIONS |
64,442 |
5.79 |
46,992 |
4.49 |
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Interest expense |
3,484 |
0.31 |
3,508 |
0.33 |
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Other income |
(1,108) |
(0.10) |
(688) |
(0.07) |
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INCOME BEFORE INCOME TAXES |
62,066 |
5.57 |
44,172 |
4.22 |
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Provision for income taxes |
24,568 |
2.21 |
17,963 |
1.71 |
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NET INCOME |
$ 37,498 |
3.37% |
$ 26,209 |
2.50% |
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EARNINGS PER COMMON SHARE: |
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Basic |
$ 0.31 |
$ 0.23 |
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Diluted |
$ 0.30 |
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