Dick’s Sporting Goods reported second-quarter earnings and revenue that topped Wall Street estimates. The retailer raised its full-year EPS guidance and also increased the low end of its full-year comparable store sales guidance.
Ed Stack, executive chairman, said in a statement, “Our second quarter performance demonstrates the strength of our core strategies and the foundational improvements we have made across our business over the past five years. In fact, we delivered approximately the same EBT in Q2 as we did in all of fiscal 2019. The state of our industry is strong, and we remain in a great lane. Dick’s is the clear market leader, and as a result of our transformation, we are well-positioned to extend our lead and deliver long-term sales and earnings growth.”
Lauren Hobart, president and chief executive officer, said, “We are very pleased with our second quarter results, and with our sales up 38 percent versus Q2 2019, the Dick’s Sporting Goods consumer has held up quite well. Our inventory is healthy and well-positioned, and we are excited about our assortment for the back-to-school season. We are raising our full-year 2022 outlook, which continues to incorporate an appropriate level of caution given today’s uncertain macroeconomic environment.”
In the quarter ended July 30, sales declined 5.0 percent to $3.11 billion from $3.27 billion a year ago. Wall Street’s consensus estimate had been $3.07 billion. Same-store sales were down 5.1 percent against a gain of 20.2 percent in the year-ago period.
On an adjusted basis, earnings were down 36.4 percent to $318.5 million, or $3.68 a share, from $501.2 million, or $5.08 a year ago. Results topped Wall Street’s consensus estimate of $3.58.
Non-GAAP adjustments related to the company’s convertible senior notes. In the current year, Dick’s exchanged $200 million aggregate principal amount of convertible senior notes and unwound the corresponding portion of the convertible bond hedge and warrants for $200 million of cash and 3.5 million shares of our common stock.
On a reported basis, net income declined 35.7 percent to $318.5 million, or $3.25, from $495.5 million, or $4.53, a year ago.
Gross margins in the quarter declined 388 basis points to 36.03 percent from 39.91 percent a year ago. Selling, general and administrative expenses increased 2.7 percent to $657.4 million and expanded as a percent of sales to 21.12 percent from 19.55 percent.
Full Year 2022 Outlook
For the full year, comparable store sales guidance is now projected in the range of negative 6 percent to negative 2 percent, up from negative 8 percent to negative 2 percent previously
Full-year 2022 EPS guidance is now expected in the range of $8.85 to 10.55, up from $7.95 to 10.15 previously. Full-year 2022 non-GAAP earnings per diluted share guidance are expected to range between $10.00 to 12.00, up from $9.15 to 11.70 previously.
Capital expenditures are still expected in the range of $400 to 425 million on a gross basis and $340 to 365 million on a net basis.
Photo courtesy Dick’s Sporting Goods
