Dick's Sporting Goods, Inc. reported net sales for the third quarter ended Oct. 29 increased by 9.3% to $1.2 billion due primarily to a 4.1% increase in consolidated same store sales and the opening of new stores. Same store sales rose 3.8% at Dick's Sporting Goods stores, 2.4% at Golf Galaxy stores and a 16.8% at its e-commerce business

The 4.1% consolidated same store sales increase consisted of a 3.8% increase at Dick's Sporting Goods stores, a 2.4% increase at Golf Galaxy stores and a 16.8% increase in its e-commerce business.
 
The retailer reported consolidated non-GAAP net income for the third quarter ended Oct. 29, 2011 of $40.2 million, or 32 cents per diluted share, exceeding previous expectations provided on Aug. 16, 2011 of 24 to 26 cents per diluted share. That compared to consolidated non-GAAP net income of $26.7 million, or 22 cents per diluted share for the third quarter ended Oct. 30, 2010 .
On a GAAP basis, DKIS reported consolidated net income for the third quarter ended Oct. 29, 2011 of $41.5 million, or 33 cents per diluted share. GAAP results include an after-tax increase to net income of $1.3 million, or 1 cent per diluted share, resulting from a partial reversal of litigation settlement costs previously accrued during the fourth quarter of fiscal 2010. For the third quarter ended Oct. 30, 2010, the company reported consolidated net income of $16.9 million, or 14 cents per diluted share, which included an 8 cent per diluted share impact from Golf Galaxy store closure costs.
 
“In the third quarter, we generated sales and earnings meaningfully above our expectations while increasing our margins and further strengthening our balance sheet,” said Edward W. Stack , Chairman and CEO. “As a result of the solid third quarter performance and our expectations for the fourth quarter, we have raised our full-year guidance.”
New Stores
As of Oct. 29, 2011 , the company operated 474 Dick's Sporting Goods stores in 42 states, with approximately 26.0 million square feet and 81 Golf Galaxy stores in 30 states, with approximately 1.3 million square feet.
Balance Sheet
The company ended the third quarter of 2011 with $483 million in cash and cash equivalents and did not have any outstanding borrowings under its $440 million credit facility. At the end of the third quarter of 2010, the company had $159 million in cash and cash equivalents and did not have any outstanding borrowings under its credit facility.
Inventory per square foot was 0.1% higher at the end of the third quarter 2011 as compared to the end of the third quarter of 2010.
 
Year-to-Date Results
The company reported consolidated non-GAAP net income for the 39 weeks ended Oct. 29, 2011 of $142.8 million, or $1.14 per diluted share. Non-GAAP earnings exclude a gain on sale of investment and the favorable impact of lower litigation settlement costs. For the 39 weeks ended Oct. 30, 2010, the company reported consolidated non-GAAP net income of $104.4 million, or 86 cents per diluted share, which excluded the impact from Golf Galaxy store closure costs.
On a GAAP basis, the company reported consolidated net income for the 39 weeks ended Oct. 29, 2011 of $152.8 million, or $1.22 per diluted share compared to net income for the 39 weeks ended Oct. 30, 2010 of $94.6 million, or 78 cents per diluted share. Net sales for the 39 weeks ended Oct. 29, 2011 increased 7.4% from last year's period to $3.6 billion primarily due to a consolidated same store sales increase of 2.9% and the opening of new stores.
 
Current 2011 Outlook
The company's current outlook for 2011 is based on current expectations and includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as described later in this release. Although the company believes that the expectations and other comments reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations or comments will prove to be correct.
Full Year 2011
Based on an estimated 126 million diluted shares outstanding, the company currently anticipates reporting consolidated non-GAAP earnings per diluted share of approximately $2.01 to $2.03, excluding a gain on sale of investments and the favorable impact of lower litigation settlement costs. This is an increase from previous expectations of non-GAAP earnings per diluted share of $1.94 to 1.96, excluding a gain on sale of investments.
 
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 2% compared to a 7.2% increase last year and at the high end of the company's previous expectation of consolidated same store sales increase of 1 to 2%.
The company has completed its 2011 store development program by opening 36 new Dick's Sporting Goods stores, remodeling 14 Dick's Sporting Goods stores and relocating one Golf Galaxy store this year.

Fourth Quarter 2011
Based on an estimated 127 million diluted shares outstanding, the company currently anticipates reporting consolidated earnings per diluted share of approximately 87 to 89 cents in the fourth quarter of 2011. In the fourth quarter of 2010, the company reported consolidated non-GAAP earnings per diluted share of 76 cents , excluding litigation settlement costs. On a GAAP basis, the company reported consolidated earnings per diluted share of $0.71 in the fourth quarter of 2010.

Consolidated same store sales are currently expected to be flat to an increase of 1% compared to a 9.3% increase in the fourth quarter last year. 
 
The company opened six new Dick's Sporting Goods stores at the beginning of the fourth quarter of 2011, completing its 2011 store development program.

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.