Ahead of its annual Analyst Meeting on Tuesday, Dick's Sporting Goods, Inc. updated its long-term plan and key strategies to increase sales, operating profit and shareholder value.

Dick's Sporting Goods Updates 2017 Financial Targets

– Anticipates
3-year diluted EPS CAGR of approximately 12 percent to 16 percent and
3-year sales CAGR of approximately 8 percent to 10 percent
– Outlines
measured pace of new store openings to capture market share and drive
sustainable, profitable growth and value to shareholders
– Reaffirms commitment to return capital to shareholders through both share repurchases and quarterly dividends
– Reiterates first quarter and full year 2015 guidance

During its Analyst Meeting, the company will update its fiscal 2017 sales target to $8.7 to 9.0 billion, representing a 3-year compounded annual growth rate (CAGR) of approximately 8 percent to 10 percent from fiscal 2014 sales of $6.8 billion. The company continues to be focused on driving profitable growth and plans to expand its operating margin by approximately 80 to 130 basis points to 9.0 percent to 9.5 percent in fiscal 2017, from non-GAAP operating margin of 8.2 percent in fiscal 2014, through both the expansion of gross margin and SG&A expense leverage. As a result of this profitable growth and its commitment to returning capital to shareholders, the company anticipates diluted earnings per share to grow at a CAGR of 12 percent to 16 percent through fiscal 2017.

Dick's Sporting Goods Omni-Channel Growth Drivers

The company sees significant opportunity to increase market share in the U.S. through growing its Dick's Sporting Goods store base in new and underpenetrated markets and increasing its eCommerce sales. Stores continue to be a very profitable growth vehicle that deliver strong new store productivity, accelerate eCommerce growth, build brand equity and customer loyalty, and reinforce the strength of the company's vendor partnerships.

The company is taking a measured approach to growing its store count and anticipates growing its Dick's Sporting Goods store base to approximately 735 to 750 stores by the end of fiscal 2017, an increase of approximately 135 to 150 stores from the 603 stores at the end of fiscal 2014. The company plans to grow eCommerce sales to approximately $1.0 to 1.2 billion in fiscal 2017, from $628 million in fiscal 2014.

eCommerce

The company plans to have the Dick's Sporting Goods eCommerce site on its own platform in January 2017. The company's GolfGalaxy.com site successfully launched on its new eCommerce platform in March 2015 and a transactional Field & Stream site is planned to go-live in Fall 2015. The company believes the investments in its eCommerce platform are critical to growing the business and increasing profitability.

Specialty Concepts

The company continues to grow its Field & Stream concept, capitalizing on its heritage in this category and the fragmented nature of the core outdoor market. These stores bring a differentiated experience to the market, focusing on authentic national brands, shop-in-shops and specialty store-level services.

The company plans to open approximately nine stores in 2015 and approximately five to eight additional stores in both 2016 and 2017. This will bring the Field & Stream store count to approximately 30 to 35 stores by the end of 2017.

The company reiterated its commitment to Golf Galaxy given the strategic benefits it sees from the chain. Golf Galaxy gives the company access to premium golf brands, insights into the enthusiast golfer and provides scale with vendors.

Capital Allocation Strategy

Dick's Sporting Goods also reaffirmed its capital allocation strategy to provide returns to shareholders through investing in the business, repurchasing shares and paying dividends.

To drive the growth of the business the company expects to invest approximately $850 million in net capital expenditures over the next three years, primarily in new stores, store remodels and eCommerce. With its $1 billion 5-year share repurchase authorization, the company targets share repurchases of $100 to 200 million annually. The company is also committed to quarterly dividends.

“We continue to be excited about the profitable long-term growth opportunities of our business,” said Edward W. Stack, Chairman and CEO. “We are operating in an attractive space in which we continue to gain market share and believe there is significant runway ahead. We remain intensely focused on driving shareholder value over the next three years by investing in the long-term growth of the business, repurchasing shares and paying quarterly dividends.”

Reaffirms 2015 Outlook

The company also reaffirmed the first quarter and full year 2015 outlook provided in its fourth quarter 2014 earnings press release dated March 3, 2015. The company currently anticipates reporting consolidated earnings per diluted share of approximately $0.49 to 0.53 in the first quarter of 2015. Consolidated same store sales are currently expected to be approximately flat to an increase of 2 percent in the first quarter of 2015.

For fiscal 2015, the company anticipates reporting consolidated earnings per diluted share of approximately $3.10 to 3.20. The company's earnings per share guidance includes the expectation of approximately $100 to 200 million of share repurchases in 2015. Consolidated same store sales are currently expected to increase 1 to 3 percent in fiscal 2015.