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Dick’s Sporting Goods reports Q1 earnings on track but same-store sales fall short

Published May 16, 2017

PITTSBURGH, Penn. (BRAIN) — Dick’s Sporting Goods has posted its sales and earnings for the first quarter of 2017, which ended April 29. The company reported a consolidated net income of $58.2 million, or $0.52 per diluted share for the period, in line with the company’s first-quarter expectations of $0.48 to 0.53 per share. Dick’s net sales for Q1 increased 9.9 percent to about $1.8 billion.

But Dick’s consolidated same-store sales missed company guidance, and this news sent shares tumbling 9.6 percent in Tuesday’s pre-market trading. Dick’s reported that same-store sales increased 2.4 percent, lower than the expected 3 to 4 percent growth for the period. First quarter 2016 consolidated same-store sales increased 0.5 percent.

The sporting goods retailer reported earnings of $0.54 per share adjusted on sales of $1.83 billion for the first quarter and non-GAAP earnings of $60.3 million for the first quarter. These results do not include the costs incurred to convert former Sports Authority stores into Dick’s locations. 

"In the first quarter, we generated non-GAAP earnings per diluted share near the high end of our guidance. Despite a challenging retail environment, we realized growth across each of our three primary categories of hardlines, apparel and footwear, and were pleased with the performance of our newly relaunched e-commerce site," said Edward W. Stack, Dick’s chairman and CEO. "We remain optimistic as we drive profitable growth on our new e-commerce platform, make marked progress on our new merchandising strategy and continue to capture market share."

"Looking ahead, we continue to evaluate and adjust our business model, and are taking actions to reduce our expense structure in order to fund and develop our longer-term strategic initiatives," Stack added.

Dick’s launched its new e-commerce platform at the start of Q1, and reported that sales have increased 11 percent. It also reported that e-commerce sales accounted for 9.3 percent of its total sales for the quarter.

The company also opened 15 new Dick’s stores in the first quarter. Looking ahead to Q2, Dick’s anticipates same-store sales will increase 2 to 3 percent. The company also recently conducted a corporate reorganization to streamline operations and reduce expenses. It expects to open 13 new stores in Q2, including some former Sports Authority stores it will convert into Dick’s locations.

Dick’s currently operates 691 stores in 47 states and sells bikes from GT, Mongoose, Schwinn, Diamondback and others.

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