Exhibit 99.1
|
|
PRESS RELEASE
|
Dick’s Sporting Goods Reports Second Quarter Results; Exceeds Earnings Expectations
· Consolidated non-GAAP earnings per diluted share increased 21% to $0.52 per diluted share in the second quarter of 2011 from $0.43 per diluted share in the second quarter of 2010
· Consolidated same store sales increased 2.5% in the second quarter of 2011
· Company raises full year estimated non-GAAP earnings range from $1.91 to 1.93 per diluted share to a range of $1.94 to 1.96 per diluted share
· Company ended the second quarter of 2011 with $626 million in cash, without any outstanding borrowings under its credit facility
PITTSBURGH, Pa., August 16, 2011 - Dick’s Sporting Goods, Inc. (NYSE: DKS) today reported sales and earnings results for the second quarter ended July 30, 2011.
Second Quarter Results
The Company reported consolidated non-GAAP net income for the second quarter ended July 30, 2011 of $65.1 million, or $0.52 per diluted share, excluding a $0.07 per diluted share impact from a gain on sale of investment. The second quarter consolidated non-GAAP earnings per diluted share exceeded estimated earnings expectations provided on May 17, 2011 of $0.47 - 0.49 per diluted share.
On a GAAP basis, the Company reported consolidated net income for the second quarter ended July 30, 2011 of $73.8 million, or $0.59 per diluted share. The GAAP to non-GAAP reconciliations are included in a table later in the release under the heading “Non-GAAP Net Income and Earnings Per Share Reconciliation.” For the second quarter ended July 31, 2010, the Company reported consolidated net income of $51.5 million, or $0.43 per diluted share.
Net sales for the second quarter of 2011 increased by 6.6% to $1.3 billion due primarily to a 2.5% increase in consolidated same store sales and the opening of new stores. The 2.5% consolidated same store sales increase consisted of a 1.7% increase at Dick’s Sporting Goods stores, a 4.0% increase at Golf Galaxy stores and a 31.9% increase in its e-commerce business.
“In the second quarter, we delivered profitable growth that exceeded our earnings projections while continuing to strengthen our balance sheet. While top line sales started slow in the quarter, June and July comps accelerated at a pace above our quarterly target of approximately 3%,” said Edward W. Stack, Chairman and CEO. “We also made marked progress in developing all of our growth drivers by adding productive, profitable stores; building our e-commerce business; and expanding our overall margin rates. As a result, we are well positioned to continue to meaningfully grow our business.”
New Stores
In the second quarter, the Company opened eight Dick’s Sporting Goods stores. These stores are listed in a table later in the release under the heading “Store Count and Square Footage.”
As of July 30, 2011, the Company operated 455 Dick’s Sporting Goods stores in 42 states, with approximately 25.1 million square feet and 81 Golf Galaxy stores in 30 states, with approximately 1.3 million square feet.
Balance Sheet
The Company ended the second quarter of 2011 with $626 million in cash and cash equivalents and did not have any outstanding borrowings under its $440 million credit facility. At the end of the second quarter of 2010, the Company had $278 million in cash and cash equivalents and did not have any outstanding borrowings under its credit facility.
The inventory per square foot was 0.9% lower at the end of the second quarter 2011 as compared to the end of the second quarter of 2010.
Year-to-Date Results
The Company reported consolidated non-GAAP net income for the 26 weeks ended July 30, 2011 of $102.6 million, or $0.82 per diluted share. On a GAAP basis, the Company reported consolidated net income for the 26 weeks ended July 30, 2011 of $111.3 million, or $0.89 per diluted share. For the 26 weeks ended July 31, 2010, the Company reported consolidated net income of $77.7 million, or $0.64 per diluted share.
Net sales for the first half of 2011 increased 6.5% from the first half of 2010 to $2.4 billion primarily due to a consolidated same store sales increase of 2.3% 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 $1.94 – 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 1 - 2% compared to a 7.2% increase last year.
· The Company currently expects to open approximately 36 new Dick’s Sporting Goods stores, remodel 14 Dick’s Sporting Goods stores, and relocate one Golf Galaxy store in 2011.
· Third Quarter 2011
· Based on an estimated 126 million diluted shares outstanding, the Company currently anticipates reporting consolidated earnings per diluted share of approximately $0.24 - 0.26 in the third quarter of 2011. In the third quarter of 2010, the Company reported consolidated non-GAAP earnings per diluted share of $0.22.
· Consolidated same store sales are currently expected to increase approximately 1 - 2% compared to a 5.1% increase in the third quarter last year.
· The Company expects to open approximately 18 new Dick’s Sporting Goods stores in the third quarter of 2011.
· 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.
“While some may view our top line guidance as being conservative, we believe that the current instability in many global markets and the uncertainty in the domestic macro economic environment, warrant a cautious outlook,” stated Mr. Stack. “With our proven ability to execute on our margin expansion opportunities and to manage inventory and expenses, we’ve maintained our earnings expectations for the second half of the year.”
Conference Call Info
The Company will be hosting a conference call today at 10:00 a.m. eastern time to discuss the second quarter results. Investors will have the opportunity to listen to the earnings conference call over the internet through the Company’s web site located at http://www.dickssportinggoods.com/investors. To listen to the live call, please go to the web site at least fifteen minutes early to register and download and install any necessary audio software.
In addition to the web cast, the call can be accessed by dialing (800) 591-6944 (domestic callers) or (617) 614-4910 (international callers) and entering confirmation code 59292096.
For those who cannot listen to the live web cast, it will be archived on the Company’s web site for 30 days. In addition, a dial-in replay of the call will be available. To listen to the replay, investors should dial (888) 286-8010 (domestic callers) or (617) 801-6888 (international callers) and enter confirmation code 68951016. The dial-in replay will be available for 30 days following the live call.
Forward-Looking Statements Involving Known and Unknown Risks and Uncertainties
Except for historical information contained herein, the statements in this release or otherwise made by our management in connection with the subject matter of this release are forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) and involve risks and uncertainties and are subject to change based on various important factors, many of which may be beyond our control. Our future performance and financial results may differ materially from those included in any such forward-looking statements and such forward-looking statements should not be relied upon by investors as a prediction of actual results. You can identify these statements as those that may predict, forecast, indicate or imply future results, performance or advancements and by forward-looking words such as “believe”, “anticipate”, “expect”, “estimate”, “predict”, “intend”, “plan”, “project”, “goal”, “will”, “will be”, “will continue”, “will result”, “could”, “may”, “might” or other words with similar meanings. Forward-looking statements include, among other things, statements about our future expectations regarding growth, revenues, earnings, profitability, spending, margins, costs, liquidity, store openings and operations, inventory, private brand products, our actions, plans or strategies.
The following factors, among others, in some cases have affected and in the future could affect our financial performance and actual results, and could cause actual results for fiscal 2011 and beyond to differ materially from those expressed or implied in any forward-looking statements included in this release or otherwise made by our management: continuation of the recent economic and financial downturn and other changes in macroeconomic factors or market conditions that impact consumer spending; changes in the general economic and business conditions and in the specialty retail or sporting goods industry in particular; fluctuations in our quarterly operating results or same store sales; volatility in our stock price; our ability to access adequate capital; competition in the sporting
goods industry; limitations on the availability of attractive store locations; inability to manage our growth, open new stores on a timely basis or expand successfully in new and existing markets; changes in consumer demand; unauthorized disclosure of sensitive, personal or confidential information; disruptions in our or our vendors’ supply chains; factors affecting our vendors, including potential increases in the costs of products, their ability to maintain their inventory and production levels and their ability or willingness to provide us with sufficient quantities of products at acceptable prices; factors that could negatively affect our private brand offerings; risks and costs relating to product liability claims, product recalls and the regulation of and other hazards associated with certain products we sell; the loss of our key executives; costs and risks associated with increased or changing laws and regulations affecting our business; our ability to secure and protect our intellectual property; risks relating to operating as a multi-channel retailer, including the impact of rapid technological change, internet security and privacy issues and the threat of systems failure or inadequacy; problems with our current management information systems or software; disruption at our distribution facilities; the seasonality of our business; regional risks because our stores are generally concentrated in the eastern half of the United States; costs and risks related to litigation or other claims against us; costs and uncertainties associated with pursuing strategic acquisitions; our ability to meet our labor needs; currency exchange rate fluctuations; risks associated with our Chief Executive Officer and his relatives’ controlling interest in the Company; the impact of foreign instability and conflict; our anti-takeover provisions, which could prevent or delay a change in control of the Company; and impairment in the carrying value of goodwill or other acquired intangibles.
Known and unknown risks and uncertainties are more fully described in the Company’s Annual Report on Form 10-K for the year ended January 29, 2011 as filed with the Securities and Exchange Commission (“SEC”) on March 18, 2011 and in other reports filed with the SEC. In addition, we operate in a highly competitive and rapidly changing environment; therefore, new risk factors can arise, and it is not possible for management to predict all such risk factors, nor to assess the impact of all such risk factors on our business or the extent to which any individual risk factor, or combination of risk factors, may cause results to differ materially from those contained in any forward-looking statement. We do not assume any obligation and do not intend to update any forward-looking statements except as may be required by the securities laws.
About Dick’s Sporting Goods, Inc.
Dick’s Sporting Goods, Inc. is an authentic full-line sporting goods retailer offering a broad assortment of brand name sporting goods equipment, apparel and footwear in a specialty store environment. The Company also owns and operates Golf Galaxy, LLC, a golf specialty retailer. As of July 30, 2011, the Company operated 455 Dick’s Sporting Goods stores in 42 states, 81 Golf Galaxy stores in 30 states and e-commerce web sites and catalog operations for both Dick’s Sporting Goods and Golf Galaxy. Dick’s Sporting Goods, Inc. news releases are available at http://www.dickssportinggoods.com/investors. The Company’s web site is not part of this release.
Contact:
Timothy E. Kullman, EVP — Finance, Administration, and Chief Financial Officer or
Anne-Marie Megela, Director, Investor Relations
(724) 273-3400
investors@dcsg.com
DICK’S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
(In thousands, except per share data)
|
|
|
13 Weeks Ended |
|
|
|
|
July 30,
2011 |
|
% of
Sales (1) |
|
July 31,
2010 |
|
% of
Sales |
|
|
Net sales |
|
$ |
1,306,695 |
|
100.00 |
% |
$ |
1,226,063 |
|
100.00 |
% |
|
Cost of goods sold, including occupancy and distribution costs |
|
905,620 |
|
69.31 |
|
865,918 |
|
70.63 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
|
401,075 |
|
30.69 |
|
360,145 |
|
29.37 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
285,729 |
|
21.87 |
|
271,372 |
|
22.13 |
|
|
Pre-opening expenses |
|
3,655 |
|
0.28 |
|
715 |
|
0.06 |
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME FROM OPERATIONS |
|
111,691 |
|
8.55 |
|
88,058 |
|
7.18 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on sale of investment |
|
(13,900 |
) |
(1.06 |
) |
— |
|
— |
|
|
Interest expense |
|
3,480 |
|
0.27 |
|
3,502 |
|
0.29 |
|
|
Other expense |
|
517 |
|
0.04 |
|
646 |
|
0.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME BEFORE INCOME TAXES |
|
121,594 |
|
9.31 |
|
83,910 |
|
6.84 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
47,746 |
|
3.65 |
|
32,394 |
|
2.64 |
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME |
|
$ |
73,848 |
|
5.65 |
% |
$ |
51,516 |
|
4.20 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER COMMON SHARE: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.61 |
|
|
|
$ |
0.44 |
|
|
|
|
Diluted |
|
$ |
0.59 |
|
|
|
$ |
0.43 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
120,207 |
|
|
|
115,815 |
|
|
|
|
Diluted |
|
125,836 |
|
|
|
121,039 |
|
|
|
(1) Column does not add due to rounding
DICK’S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
(In thousands, except per share data)
|
|
|
26 Weeks Ended |
|
|
|
|
July 30,
2011 |
|
% of
Sales (1) |
|
July 31,
2010 |
|
% of
Sales |
|
|
Net sales |
|
$ |
2,420,544 |
|
100.00 |
% |
$ |
2,273,595 |
|
100.00 |
% |
|
Cost of goods sold, including occupancy and distribution costs |
|
1,689,026 |
|
69.78 |
|
1,611,229 |
|
70.87 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
|
731,518 |
|
30.22 |
|
662,366 |
|
29.13 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
549,465 |
|
22.70 |
|
524,521 |
|
23.07 |
|
|
Pre-opening expenses |
|
5,921 |
|
0.24 |
|
2,795 |
|
0.12 |
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME FROM OPERATIONS |
|
176,132 |
|
7.28 |
|
135,050 |
|
5.94 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on sale of investment |
|
(13,900 |
) |
(0.57 |
) |
— |
|
— |
|
|
Interest expense |
|
6,964 |
|
0.29 |
|
7,010 |
|
0.31 |
|
|
Other income |
|
(591 |
) |
(0.02 |
) |
(43 |
) |
(0.00 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
INCOME BEFORE INCOME TAXES |
|
183,659 |
|
7.59 |
|
128,083 |
|
5.63 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
72,313 |
|
2.99 |
|
50,358 |
|
2.21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME |
|
$ |
111,346 |
|
4.60 |
% |
$ |
77,725 |
|
3.42 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER COMMON SHARE: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.93 |
|
|
|
$ |
0.67 |
|
|
|
|
Diluted |
|
$ |
0.89 |
|
|
|
$ |
0.64 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
119,784 |
|
|
|
115,485 |
|
|
|
|
Diluted |
|
125,602 |
|
|
|
120,713 |
|
|
|
(1) Column does not add due to rounding
DICK’S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - UNAUDITED
(Dollars in thousands)
|
|
|
July 30, |
|
July 31, |
|
January 29, |
|
|
|
|
2011 |
|
2010 |
|
2011 |
|
|
|
|
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
626,415 |
|
$ |
278,169 |
|
$ |
546,052 |
|
|
Accounts receivable, net |
|
55,587 |
|
45,462 |
|
34,978 |
|
|
Income taxes receivable |
|
1,652 |
|
6,982 |
|
9,050 |
|
|
Inventories, net |
|
1,026,861 |
|
985,799 |
|
896,895 |
|
|
Prepaid expenses and other current assets |
|
63,159 |
|
61,060 |
|
58,394 |
|
|
Deferred income taxes |
|
13,651 |
|
7,528 |
|
18,961 |
|
|
Total current assets |
|
1,787,325 |
|
1,385,000 |
|
1,564,330 |
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net |
|
737,484 |
|
677,779 |
|
684,886 |
|
|
Intangible assets, net |
|
51,098 |
|
47,585 |
|
51,070 |
|
|
Goodwill |
|
200,594 |
|
200,594 |
|
200,594 |
|
|
Other assets: |
|
|
|
|
|
|
|
|
Deferred income taxes |
|
28,004 |
|
72,261 |
|
27,157 |
|
|
Investments |
|
1,015 |
|
10,765 |
|
10,789 |
|
|
Other |
|
57,863 |
|
40,620 |
|
58,710 |
|
|
Total other assets |
|
86,882 |
|
123,646 |
|
96,656 |
|
|
TOTAL ASSETS |
|
$ |
2,863,383 |
|
$ |
2,434,604 |
|
$ |
2,597,536 |
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
553,108 |
|
$ |
532,007 |
|
$ |
446,511 |
|
|
Accrued expenses |
|
284,457 |
|
252,814 |
|
279,284 |
|
|
Deferred revenue and other liabilities |
|
92,595 |
|
83,983 |
|
121,753 |
|
|
Income taxes payable |
|
23,915 |
|
7,089 |
|
— |
|
|
Current portion of other long-term debt and leasing obligations |
|
995 |
|
978 |
|
995 |
|
|
Total current liabilities |
|
955,070 |
|
876,871 |
|
848,543 |
|
|
LONG-TERM LIABILITIES: |
|
|
|
|
|
|
|
|
Other long-term debt and leasing obligations |
|
139,359 |
|
140,807 |
|
139,846 |
|
|
Deferred revenue and other liabilities |
|
258,804 |
|
228,199 |
|
245,566 |
|
|
Total long-term liabilities |
|
398,163 |
|
369,006 |
|
385,412 |
|
|
COMMITMENTS AND CONTINGENCIES |
|
|
|
|
|
|
|
|
STOCKHOLDERS’ EQUITY: |
|
|
|
|
|
|
|
|
Common stock |
|
954 |
|
908 |
|
938 |
|
|
Class B common stock |
|
250 |
|
250 |
|
250 |
|
|
Additional paid-in capital |
|
666,981 |
|
554,741 |
|
625,184 |
|
|
Retained earnings |
|
841,814 |
|
626,116 |
|
730,468 |
|
|
Accumulated other comprehensive income |
|
151 |
|
6,712 |
|
6,741 |
|
|
Total stockholders’ equity |
|
1,510,150 |
|
1,188,727 |
|
1,363,581 |
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
$ |
2,863,383 |
|
$ |
2,434,604 |
|
$ |
2,597,536 |
|
DICK’S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED
(Dollars in thousands)
|
|
|
26 Weeks Ended |
|
|
|
|
July 30, |
|
July 31, |
|
|
|
|
2011 |
|
2010 |
|
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
Net income |
|
$ |
111,346 |
|
$ |
77,725 |
|
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
55,316 |
|
52,153 |
|
|
Deferred income taxes |
|
8,393 |
|
(13,907 |
) |
|
Stock-based compensation |
|
13,326 |
|
12,511 |
|
|
Excess tax benefit from exercise of stock options |
|
(12,795 |
) |
(6,220 |
) |
|
Tax benefit from exercise of stock options |
|
231 |
|
446 |
|
|
Other non-cash items |
|
761 |
|
774 |
|
|
Gain on sale of investment |
|
(13,900 |
) |
— |
|
|
Changes in assets and liabilities: |
|
|
|
|
|
|
Accounts receivable |
|
(13,180 |
) |
(3,696 |
) |
|
Inventories |
|
(129,966 |
) |
(90,023 |
) |
|
Prepaid expenses and other assets |
|
(5,415 |
) |
(6,453 |
) |
|
Accounts payable |
|
103,656 |
|
74,009 |
|
|
Accrued expenses |
|
(16,363 |
) |
(15,212 |
) |
|
Income taxes payable/receivable |
|
44,030 |
|
5,608 |
|
|
Deferred construction allowances |
|
12,687 |
|
4,815 |
|
|
Deferred revenue and other liabilities |
|
(32,149 |
) |
(25,859 |
) |
|
Net cash provided by operating activities |
|
125,978 |
|
66,671 |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
Capital expenditures |
|
(85,600 |
) |
(61,611 |
) |
|
Proceeds from sale of investment |
|
14,140 |
|
— |
|
|
Proceeds from sale-leaseback transactions |
|
3,073 |
|
5,874 |
|
|
Deposits and purchases of other assets |
|
(8,045 |
) |
— |
|
|
Net cash used in investing activities |
|
(76,432 |
) |
(55,737 |
) |
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
Payments on other long-term debt and leasing obligations |
|
(487 |
) |
(458 |
) |
|
Construction allowance receipts |
|
— |
|
— |
|
|
Proceeds from exercise of stock options |
|
18,994 |
|
9,225 |
|
|
Excess tax benefit from exercise of stock options |
|
12,795 |
|
6,220 |
|
|
Repurchase of common stock |
|
(3,455 |
) |
— |
|
|
Increase in bank overdraft |
|
2,941 |
|
26,632 |
|
|
Net cash provided by financing activities |
|
30,788 |
|
41,619 |
|
|
|
|
|
|
|
|
|
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS |
|
29 |
|
5 |
|
|
NET INCREASE IN CASH AND CASH EQUIVALENTS |
|
80,363 |
|
52,558 |
|
|
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD |
|
546,052 |
|
225,611 |
|
|
CASH AND CASH EQUIVALENTS, END OF PERIOD |
|
$ |
626,415 |
|
$ |
278,169 |
|
|
|
|
|
|
|
|
|
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
Accrued property and equipment |
|
$ |
21,536 |
|
$ |
21,612 |
|
|
Cash paid for interest |
|
$ |
6,205 |
|
$ |
6,155 |
|
|
Cash paid for income taxes |
|
$ |
19,173 |
|
$ |
58,053 |
|
Store Count and Square Footage
The stores that opened during the second quarter of 2011 are as follows:
|
DICK’S |
|
Store |
|
Market |
|
Modesto, CA |
|
Modesto |
|
Daphne, AL |
|
Mobile |
|
Pocatello, ID |
|
Pocatello |
|
Fresno, CA |
|
Fresno |
|
Nashua, NH |
|
Nashua |
|
Coon Rapids, MN |
|
Minneapolis |
|
Staten Island, NY |
|
New York Metro |
|
Manhattan, KS |
|
Manhattan |
The following represents a reconciliation of beginning and ending stores and square footage for the periods indicated:
|
|
|
Fiscal 2011 |
|
Fiscal 2010 |
|
|
|
|
Dick's |
|
|
|
|
|
Dick's |
|
|
|
|
|
|
|
|
Sporting |
|
Golf |
|
|
|
Sporting |
|
Golf |
|
|
|
|
|
|
Goods |
|
Galaxy |
|
Total |
|
Goods |
|
Galaxy |
|
Total |
|
|
Beginning stores |
|
444 |
|
81 |
|
525 |
|
419 |
|
91 |
|
510 |
|
|
Q1 New |
|
3 |
|
— |
|
3 |
|
5 |
|
— |
|
5 |
|
|
Q2 New |
|
8 |
|
— |
|
8 |
|
1 |
|
— |
|
1 |
|
|
Ending stores |
|
455 |
|
81 |
|
536 |
|
425 |
|
91 |
|
516 |
|
|
Closed stores |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
|
Ending stores |
|
455 |
|
81 |
|
536 |
|
425 |
|
91 |
|
516 |
|
|
Remodeled stores |
|
1 |
|
— |
|
1 |
|
3 |
|
— |
|
3 |
|
|
Relocated stores |
|
— |
|
1 |
|
1 |
|
— |
|
— |
|
— |
|
Square Footage:
(in millions)
|
|
|
Dick's
Sporting
Goods |
|
Golf
Galaxy |
|
Total |
|
|
Q1 2010 |
|
23.6 |
|
1.5 |
|
25.1 |
|
|
Q2 2010 |
|
23.7 |
|
1.5 |
|
25.2 |
|
|
Q3 2010 |
|
24.3 |
|
1.3 |
|
25.6 |
|
|
Q4 2010 |
|
24.6 |
|
1.3 |
|
25.9 |
|
|
Q1 2011 |
|
24.7 |
|
1.3 |
|
26.0 |
|
|
Q2 2011 |
|
25.1 |
|
1.3 |
|
26.4 |
|
Non-GAAP Financial Measures
In addition to reporting the Company’s financial results in accordance with generally accepted accounting principles (“GAAP”), the Company provides information regarding net income and earnings per diluted share adjusted for gain on sale of investment; earnings before interest, taxes and depreciation, adjusted to exclude certain significant gains and losses (“Adjusted EBITDA”); a reconciliation from the Company’s gross capital expenditures, net of tenant allowances; and calculations of consolidated and Dick’s Sporting Goods new store productivity. These measures are considered non-GAAP and are not preferable to GAAP financial information; however, the Company believes this information provides additional measures of performance that the Company’s management, analysts and investors can use to compare core, operating results between reporting periods. These non-GAAP measures are provided below and on the Company’s website at http://www.dickssportinggoods.com/investors.
Non-GAAP Net Income and Earnings Per Share Reconciliation
(in thousands, except per share data):
|
|
|
13 Weeks Ended July 30, 2011 |
|
|
|
|
As |
|
Gain on Sale |
|
Non-GAAP |
|
|
|
|
Reported |
|
of Investment |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
$ |
1,306,695 |
|
$ |
— |
|
$ |
1,306,695 |
|
|
Cost of goods sold, including occupancy and distribution costs |
|
905,620 |
|
— |
|
905,620 |
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
|
401,075 |
|
— |
|
401,075 |
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
285,729 |
|
— |
|
285,729 |
|
|
Pre-opening expenses |
|
3,655 |
|
— |
|
3,655 |
|
|
|
|
|
|
|
|
|
|
|
INCOME FROM OPERATIONS |
|
111,691 |
|
— |
|
111,691 |
|
|
|
|
|
|
|
|
|
|
|
Gain on sale of investment |
|
(13,900 |
) |
13,900 |
|
— |
|
|
Interest expense |
|
3,480 |
|
— |
|
3,480 |
|
|
Other expense |
|
517 |
|
— |
|
517 |
|
|
|
|
|
|
|
|
|
|
|
INCOME BEFORE INCOME TAXES |
|
121,594 |
|
(13,900 |
) |
107,694 |
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
47,746 |
|
(5,162 |
) |
42,584 |
|
|
|
|
|
|
|
|
|
|
|
NET INCOME |
|
$ |
73,848 |
|
$ |
(8,738 |
) |
$ |
65,110 |
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER COMMON SHARE: |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.61 |
|
|
|
$ |
0.54 |
|
|
Diluted |
|
$ |
0.59 |
|
|
|
$ |
0.52 |
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: |
|
|
|
|
|
|
|
|
Basic |
|
120,207 |
|
|
|
120,207 |
|
|
Diluted |
|
125,836 |
|
|
|
125,836 |
|
During the second quarter of 2011, the Company recorded a pre-tax gain of $13.9 million relating to the sale of available-for-sale securities.
Non-GAAP Net Income and Earnings Per Share Reconciliation
(in thousands, except per share data):
|
|
|
26 Weeks Ended July 30, 2011 |
|
|
|
|
As |
|
Gain on Sale |
|
Non-GAAP |
|
|
|
|
Reported |
|
of Investment |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
$ |
2,420,544 |
|
$ |
— |
|
$ |
2,420,544 |
|
|
Cost of goods sold, including occupancy and distribution costs |
|
1,689,026 |
|
— |
|
1,689,026 |
|
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
|
731,518 |
|
— |
|
731,518 |
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
549,465 |
|
— |
|
549,465 |
|
|
Pre-opening expenses |
|
5,921 |
|
— |
|
5,921 |
|
|
|
|
|
|
|
|
|
|
|
INCOME FROM OPERATIONS |
|
176,132 |
|
— |
|
176,132 |
|
|
|
|
|
|
|
|
|
|
|
Gain on sale of investment |
|
(13,900 |
) |
13,900 |
|
— |
|
|
Interest expense |
|
6,964 |
|
— |
|
6,964 |
|
|
Other income |
|
(591 |
) |
— |
|
(591 |
) |
|
|
|
|
|
|
|
|
|
|
INCOME BEFORE INCOME TAXES |
|
183,659 |
|
(13,900 |
) |
169,759 |
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
72,313 |
|
(5,162 |
) |
67,151 |
|
|
|
|
|
|
|
|
|
|
|
NET INCOME |
|
$ |
111,346 |
|
$ |
(8,738 |
) |
$ |
102,608 |
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER COMMON SHARE: |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.93 |
|
|
|
$ |
0.86 |
|
|
Diluted |
|
$ |
0.89 |
|
|
|
$ |
0.82 |
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: |
|
|
|
|
|
|
|
|
Basic |
|
119,784 |
|
|
|
119,784 |
|
|
Diluted |
|
125,602 |
|
|
|
125,602 |
|
During the second quarter of 2011, the Company recorded a pre-tax gain of $13.9 million relating to the sale of available-for-sale securities.
Adjusted EBITDA
Adjusted EBITDA should not be considered as an alternative to net income or any other generally accepted accounting principles measure of performance or liquidity. Adjusted EBITDA, as the Company has calculated it, may not be comparable to similarly titled measures reported by other companies. Adjusted EBITDA is a key metric used by the Company that provides a measurement of profitability that eliminates the effect of changes resulting from financing decisions, tax regulations, and capital investments.
|
|
|
13 Weeks Ended |
|
|
|
|
July 30, |
|
July 31, |
|
|
|
|
2011 |
|
2010 |
|
|
|
|
(dollars in thousands) |
|
|
Net income |
|
$ |
73,848 |
|
$ |
51,516 |
|
|
Provision for income taxes |
|
47,746 |
|
32,394 |
|
|
Interest expense |
|
3,480 |
|
3,502 |
|
|
Depreciation and amortization |
|
27,880 |
|
26,287 |
|
|
EBITDA |
|
$ |
152,954 |
|
$ |
113,699 |
|
|
Less: Gain on sale of investment |
|
(13,900 |
) |
— |
|
|
Adjusted EBITDA, as defined |
|
$ |
139,054 |
|
$ |
113,699 |
|
|
|
|
|
|
|
|
|
% increase in Adjusted EBITDA |
|
22 |
% |
|
|
|
|
|
26 Weeks Ended |
|
|
|
|
July 30, |
|
July 31, |
|
|
|
|
2011 |
|
2010 |
|
|
|
|
(dollars in thousands) |
|
|
Net income |
|
$ |
111,346 |
|
$ |
77,725 |
|
|
Provision for income taxes |
|
72,313 |
|
50,358 |
|
|
Interest expense |
|
6,964 |
|
7,010 |
|
|
Depreciation and amortization |
|
55,316 |
|
52,153 |
|
|
EBITDA |
|
$ |
245,939 |
|
$ |
187,246 |
|
|
Less: Gain on sale of investment |
|
(13,900 |
) |
— |
|
|
Adjusted EBITDA, as defined |
|
$ |
232,039 |
|
$ |
187,246 |
|
|
|
|
|
|
|
|
|
% increase in Adjusted EBITDA |
|
24 |
% |
|
|
|
|
|
|
|
|
|
Reconciliation of Gross Capital Expenditures to Net Capital Expenditures
The following table represents a reconciliation of the Company’s gross capital expenditures to its capital expenditures, net of tenant allowances.
|
|
|
26 Weeks Ended |
|
|
|
|
July 30, |
|
July 31, |
|
|
|
|
2011 |
|
2010 |
|
|
|
|
(dollars in thousands) |
|
|
Gross capital expenditures |
|
$ |
(85,600 |
) |
$ |
(61,611 |
) |
|
Proceeds from sale-leaseback transactions |
|
3,073 |
|
5,874 |
|
|
Changes in deferred construction allowances |
|
12,687 |
|
4,815 |
|
|
Construction allowance receipts |
|
— |
|
— |
|
|
Net capital expenditures |
|
$ |
(69,840 |
) |
$ |
(50,922 |
) |
|
|
|
|
|
|
|
New Store Productivity Calculation
The following calculations represent: (1) the new store productivity calculation on a consolidated basis; and (2) the new store productivity calculation for Dick’s Sporting Goods for the quarter ended July 30, 2011. Golf Galaxy stores and the Company’s e-commerce business are excluded from the Dick’s Sporting Goods only calculation. New store productivity compares the sales increase for all stores not included in the same store sales calculation with the increase in store square footage.
|
|
|
Consolidated |
|
Dick’s Sporting Goods Only |
|
|
|
|
13 Weeks Ended |
|
13 Weeks Ended |
|
|
|
|
July 30, |
|
July 31, |
|
July 30, |
|
July 31, |
|
|
|
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales % increase for the period |
|
6.6 |
% |
|
|
6.9 |
% |
|
|
|
Same store sales % increase for the period |
|
2.5 |
% |
|
|
1.7 |
% |
|
|
|
New store sales % increase (A) (1) |
|
4.0 |
% |
|
|
5.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Store square footage (000’s): |
|
|
|
|
|
|
|
|
|
|
Beginning of period |
|
26,054 |
|
25,091 |
|
24,722 |
|
23,612 |
|
|
End of period |
|
26,462 |
|
25,168 |
|
25,122 |
|
23,689 |
|
|
Average for the period |
|
26,258 |
|
25,130 |
|
24,922 |
|
23,651 |
|
|
Average square footage % increase for the period (B) |
|
4.5 |
% |
|
|
5.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New store productivity (A)/(B) (1) |
|
90.2 |
% |
|
|
95.0 |
% |
|
|
(1) - Amounts do not recalculate due to rounding.