Dick's Sporting Goods said fourth-quarter net income rose 8% to $73.2 million, or 62 cents a share, topping recent guidance calling for 60 to 61 cents a share. A year ago, the company posted net income of $67.7 million, or 60 cents a share, for the fourth quarter.
and included the favorable impact of sales of licensed merchandise relating to the Super Bowl, which combined contributed approximately $0.05 to its fiscal 2006 earnings. The company's most recent guidance provided on January 15, 2008 was for earnings per diluted share of at least $0.60 – 0.61. The operating results of Golf Galaxy are included in the current period results and the results for Chick's are included from its November 30, 2007 acquisition date.
Net sales for the 13 weeks increased 18% to $1,212.6 million due to the
opening of new stores, the inclusion of Golf Galaxy in this year's
quarterly results (which will be included in Dick's Sporting Goods
comparable store sales calculation beginning in Q1 2008), and a comparable store sales increase of 2.7% on a 13-week to 13-week comparable basis (or an increase of 3.4%, adjusting for the shifted retail calendar). Comparable store sales for Golf Galaxy on a 13-week to 13-week proforma basis decreased 8.8%, or 9.8% after adjusting for the shifted retail calendar.
“We are pleased to have delivered 4th quarter sales and earnings in
excess of our guidance, culminating a year in which our business generated a 30% EPS increase. We also made two acquisitions, continued to capture market share in new and existing markets, expanded our merchandise margin, and improved our operating efficiency,” said Edward W. Stack, Chairman and CEO.
In the fourth quarter, the company opened four Golf Galaxy stores, one
each in Baltimore, MD; Fairfax, VA; Phoenix, AZ and Washington DC. In
addition, Golf Galaxy closed two stores, one each in Memphis, TN and
Pittsburgh, PA. As of February 2, 2008, the Company operated 340 Dick's Sporting Goods stores in 36 states, with approximately 19.0 million square feet, 79 Golf Galaxy stores in 29 states, with approximately 1.3 million square feet, and 15 Chick's Sporting Goods stores in California, with approximately 0.8 million square feet.
Full Year Results (52 weeks compared to 53 weeks last year)
Net income for the 52 weeks ended February 2, 2008 increased 38% to
$155.0 million and earnings per diluted share increased 30% to $1.33, as compared to prior year 53 week net income of $112.6 million, or $1.02 per diluted share. The operating results of Golf Galaxy and Chick's have been included in the results from their respective acquisition dates.
Net sales for the 52 weeks increased 25% to $3,888.4 million as
compared to the 53 weeks ended February 3, 2007, while comparable store sales at Dick's stores on a 52-week to 52-week basis increased 2.4%, compared to a 6.0% increase last year. The increase in sales this year was also attributable to the opening of new stores and the inclusion of Golf Galaxy and Chick's in this year's results. Comparable store sales for Golf Galaxy on a proforma basis were flat for the year.
Current 2008 Outlook
The company's current outlook for 2008 is based on current expectations and includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act as described later in this release. Although the Company believes that comments reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct.
“We are cautiously optimistic about our business prospects in 2008,”
said Stack, Chairman & CEO. “This year we will add approximately
46 Dick's stores, 10 Golf Galaxy stores, and will open a new distribution
center in Atlanta to support our continued growth. We will continue to
build our private brand strategy with partnerships with Nike ACG, adidas
baseball, Reebok apparel and our newest brand Maxfli. Even with all of
these key initiatives we can't ignore the uncertain macro economic
environment we are all currently facing.”
— Full Year 2008
— Based on an estimated 121 million diluted shares outstanding the company anticipates reporting consolidated earnings per diluted share of approximately $1.49 – 1.54. This represents an approximate 12 – 16% increase over earnings per diluted share for the full year 2007 of $1.33.
— Comparable store sales, which include Dick's Sporting Goods and Golf Galaxy stores, are expected to be approximately flat to an increase of 1%. The Golf Galaxy stores are included in the comparable store sales calculation beginning in the first quarter of 2008. The comparable store sales calculation excludes the Chick's Sporting Goods stores.
— The Company expects to open approximately 46 new Dick's Sporting Goods stores, ten new Golf Galaxy stores and relocate one Dick's store in 2008.
— First Quarter 2008
— Based on an estimated 119 million diluted shares outstanding, the company anticipates reporting consolidated earnings per diluted share of approximately $0.16 – 0.19, as compared to first quarter 2007 earnings per diluted share of $0.19.
— Comparable store sales, which include Dick's and Golf Galaxy stores, are expected to decrease approximately 1 – 4%. The comparable store sales calculation excludes the Chick's Sporting Goods stores.
— The Company expects to open approximately eight new Dick's stores and four new Golf Galaxy stores in the first quarter.
Dick attributed the increase in revenue to the opening of new stores, the inclusion of Golf Galaxy in this year's quarterly results, and a same-store sales increase of 2.7% for the 13-week period.