Hibbett Sporting Goods, Inc. reported an 11.0% increase in net sales for the second quarter to $104.4 million from $94.0 million for the same period last year. Comparable store sales increased 0.6% during the same period. Net income for the second quarter decreased 17.3% to $4.0 million compared with $4.9 million in the second fiscal quarter of last year. Earnings per diluted share were 12 cents compared with 14 cents per diluted share in the prior year. As compared to prior year proforma net income of $4.7 million, or 14 cents per diluted share, net income for the second fiscal quarter decreased 14.7% and earnings per diluted share decreased 9.5%.
Net sales for the 26-week period ended July 29, 2006, increased 10.7% to $231.3 million compared with $208.8 million for the 26-week period ended July 30, 2005. Comparable store sales increased 0.4% in the first half of fiscal 2007. Net income for the first half of fiscal 2007 decreased 0.1% to $15.5 million compared with $15.6 million in the first half of fiscal 2006. Earnings per diluted share were $0.47 compared with $0.45 per diluted share in the prior year. As compared to prior year proforma net income of $15.0 million, or $0.43 per diluted share, net income for the first half of fiscal 2007 increased 3.4% and earnings per diluted share increased 8.6%.
Hibbett opened 15 new stores and closed 3 stores during the second quarter, bringing the store base to 572 stores. Hibbett also opened its first store in Arizona in the second quarter giving the Company a presence in 23 states. In fiscal 2007, the Company plans to open approximately 82 to 88 new stores, while closing approximately 10 to 12 stores. For the third quarter, the Company expects to open 20 to 25 stores while closing approximately 2 stores.
Mickey Newsome, Chairman and Chief Executive Officer, stated, “Consistent with our announcement earlier this month, our sales results reflected a shift in sales during the last two weeks of the second quarter into the third quarter that was nearly twice what we expected. The state of Georgia moved its tax-free shopping holidays from late July to early August, while Alabama, Tennessee and Virginia introduced tax-free holidays for the first time in early August.”
“As we move forward into the second half of the year, we are encouraged by the strength of our comparable store sales during the first eighteen days of the third quarter, which are up approximately 12%. Given the importance of the month of August to our business, we believe this performance positions us well for the balance of the quarter. We expect a comparable store sales increase of 2% to 3% for the third quarter as we account for the tougher sales comparisons in the back half of the quarter due to the strong, post-storm sales experienced along the Gulf Coast following Hurricane Katrina last year.”
Fiscal 2007 Outlook
For the third quarter ending October 28, 2006, the Company expects to report earnings per diluted share of approximately 26 cents to 29 cents (which includes approximately one cent of equity award expense per diluted share) and a comparable store sales increase of 2% to 3%. Guidance for fiscal 2007 remains unchanged at approximately $1.08 to $1.12 per diluted share (which includes 7 cents to 9 cents of equity award expense per diluted share) and a comparable store sales increase in the 2% to 3% range.
HIBBETT SPORTING GOODS, INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Operations
(Dollars in thousands, except per share amounts)
Thirteen Weeks Twenty-Six Weeks
Ended Ended
------------------ ------------------
July 29, July 30, July 29, July 30,
2006 2005 2006 2005
-------- -------- -------- --------
Net sales $104,363 $ 94,024 $231,277 $208,848
Cost of goods sold, including
distribution center and store
occupancy costs 71,671 64,442 154,445 139,727
-------- -------- -------- --------
Gross profit 32,692 29,582 76,832 69,121
Store operating, selling, and
administrative expenses 23,517 19,847 46,827 40,128
Depreciation and amortization 2,750 2,494 5,455 4,948
-------- -------- -------- --------
Operating income 6,425 7,241 24,550 24,045
Interest income, net 111 297 432 616
-------- -------- -------- --------
Income before provision
for income taxes 6,536 7,538 24,982 24,661
Provision for income taxes 2,516 2,679 9,439 9,100
-------- -------- -------- --------
Net income $ 4,020 $ 4,859 $ 15,543 $ 15,561
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Net Income per common share:
Basic earnings per share $ 0.12 $ 0.14 $ 0.48 $ 0.46
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Diluted earnings per
share $ 0.12 $ 0.14 $ 0.47 $ 0.45
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Weighted average shares
outstanding:
Basic 32,205 34,206 32,341 34,085
======== ======== ======== ========
Diluted 32,656 35,135 32,894 34,946
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