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Dick's Sporting Goods Reports Third Quarter Results; Exceeds Expectations



  Dick's Sporting Goods Reports Third Quarter Results; Exceeds Expectations

- Consolidated earnings per diluted share increased 25% to $0.40 per diluted
share in the third quarter of 2012 compared to non-GAAP earnings per diluted
share of $0.32 in the third quarter of 2011

- Consolidated same store sales increased 5.1% in the third quarter of 2012

- Company raises full year estimated consolidated non-GAAP earnings range from
$2.47 to 2.51 per diluted share to $2.53 to 2.55 per diluted share

- Board authorizes quarterly dividend of $0.125 per share

PR Newswire

PITTSBURGH, Nov. 13, 2012

PITTSBURGH, Nov. 13, 2012 /PRNewswire/ -- Dick's Sporting Goods, Inc. (NYSE:
DKS), the largest U.S.-based full-line sporting goods retailer, today reported
sales and earnings results for the third quarter ended October 27, 2012.

Third Quarter Results

The Company reported consolidated net income for the third quarter ended
October 27, 2012 of $50.1 million, or $0.40 per diluted share, exceeding the
Company's earnings expectations provided on August 14, 2012 of $0.36 per
diluted share. For the third quarter ended October 29, 2011, the Company
reported consolidated non-GAAP net income of $40.2 million, or $0.32 per
diluted share, excluding the favorable impact of lower litigation settlement
costs. On a GAAP basis, the Company reported consolidated net income for the
third quarter ended October 29, 2011 of $41.5 million, or $0.33 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
Reconciliations."

Net sales for the third quarter of 2012 increased by 11.2% to $1.3 billion due
primarily to a 5.1% increase in consolidated same store sales and the growth
of the Company's store network. The 5.1% consolidated same store sales
increase consisted of a 3.9% increase at Dick's Sporting Goods stores, a 2.3%
increase at Golf Galaxy and a 46.7% increase in the eCommerce business.

"We generated record results in the third quarter, exceeding our original
sales and earnings expectations," said Edward W. Stack, Chairman and CEO. "By
growing our store base, partnering with our brands, aggressively building out
our omni-channel capabilities and executing our strategic marketing plan, we
are driving continued profitable growth."

New Stores

In the third quarter, the Company opened 21 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 the end of the third quarter, the Company operated 511 Dick's Sporting
Goods stores in 44 states, with approximately 27.9 million square feet and 81
Golf Galaxy stores in 30 states, with approximately 1.3 million square feet.

In the beginning of the fourth quarter, the Company opened seven new Dick's
Sporting Goods stores, relocated one Dick's Sporting Goods store and
repositioned one Golf Galaxy store.

The Company has now completed its 2012 store development program, opening a
total of 38 new Dick's Sporting Goods stores, relocating five Dick's Sporting
Goods stores and repositioning one Golf Galaxy store. 

Balance Sheet

The Company ended the third quarter of 2012 with $294 million in cash and cash
equivalents and did not have any outstanding borrowings under its $500 million
revolving credit facility. At the end of the third quarter of 2011, the
Company had $483 million in cash and cash equivalents and did not have any
outstanding borrowings under its credit facility. Over the course of the past
twelve months, the Company has utilized capital to fund its share repurchase
program, pay quarterly dividends, purchase its store support center, invest in
JJB Sports, acquire intellectual property rights to the Top-Flite and Field &
Stream brands, and build a distribution center.

The inventory per square foot was 4.0% higher at the end of the third quarter
of 2012 as compared to the end of the third quarter of 2011.

Year-to-Date Results

The Company reported consolidated non-GAAP net income for the 39 weeks ended
October 27, 2012 of $188.6 million, or $1.50 per diluted share.  For the 39
weeks ended October 29, 2011, the Company reported consolidated non-GAAP net
income of $142.8 million, or $1.14 per diluted share.

On a GAAP basis, the Company reported consolidated net income for the 39 weeks
ended October 27, 2012 of $161.0 million, or $1.28 per diluted share. For the
39 weeks ended October 29, 2011, the Company reported consolidated net income
of $152.8 million, or $1.22 per diluted share. 

Net sales for the 39 weeks ended October 27, 2012 increased 12.0% from last
year's period to $4.0 billion primarily due to a 5.6% increase in consolidated
same store sales and the growth of the Company's store network.

Dividend

On November 7, 2012, the Company's Board of Directors authorized and declared
a quarterly dividend in the amount of $0.125 per share on the Company's Common
Stock and Class B Common Stock. The dividend is payable in cash on December
28, 2012 to stockholders of record at the close of business on November 30,
2012. 

Current 2012 Outlook

The Company's current outlook for 2012 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.

  o Full Year 2012 – (53 Week Year) Comparisons to Fiscal 2011 – (52 Week
    Year) 

       o Based on an estimated 126 million diluted shares outstanding, the
         Company currently anticipates reporting consolidated non-GAAP
         earnings per diluted share of approximately $2.53 to 2.55, excluding
         an impairment charge and including approximately $0.03 per diluted
         share for the 53^rd week.  On a 52-week basis, non-GAAP earnings per
         diluted share are expected to be $2.50 to 2.52.  For the 52 weeks
         ended January 28, 2012, the Company reported consolidated non-GAAP
         earnings per diluted share of $2.02, excluding a gain on sale of
         investment and the favorable impact of lower litigation settlement
         costs. On a GAAP basis, the Company reported consolidated earnings
         per diluted share of $2.10 in 2011.
       o Consolidated same store sales are currently expected to increase
         approximately 5% on a 52-week to 52-week comparative basis, compared
         to a 2.0% increase in fiscal 2011.

  o Fourth Quarter 2012 – (14 Week Quarter) Comparisons to Fourth Quarter 2011
    – (13 Week Quarter)

       o Based on an estimated 127 million diluted shares outstanding,the
         Company currently anticipates reporting consolidated earnings per
         diluted share of approximately $1.03 to 1.05 in the fourth quarter of
         2012 compared to our prior expectation of $1.01 to 1.05.  The fourth
         quarter guidance includes approximately $0.03 per diluted share for
         the 14^th week.  On a 13-week basis, earnings per diluted share are
         expected to be $1.00 to 1.02.  In the fourth quarter of 2011, the
         Company reported consolidated earnings per diluted share of $0.88.
       o Consolidated same store sales are currently expected to increase
         approximately 4% compared to a 0.1% increase in the fourth quarter
         last year.

  o Capital Expenditures

       o In 2012, the Company anticipates capital expenditures to be
         approximately $235 million on a gross basis and approximately $190
         million on a net basis.

Conference Call Info

The Company will be hosting a conference call today at 10:00 a.m. eastern time
to discuss the third quarter results. Investors will have the opportunity to
listen to the earnings conference call over the internet through the Company's
website located at http://www.dickssportinggoods.com/investors. To listen to
the live call, please go to the website at least fifteen minutes early to
register and download and install any necessary audio software. 

In addition to the webcast, the call can be accessed by dialing (866) 652-5200
(domestic callers) or (412) 317-6060 (international callers) and requesting
the "Dick's Sporting Goods Earnings Call."

For those who cannot listen to the live webcast, it will be archived on the
Company's website for 30 days. In addition, a dial-in replay of the call will
be available. To listen to the replay, investors should dial (877) 344-7529
(domestic callers) or (412) 317-0088 (international callers) and enter
confirmation code 10019854. 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
includes statements regarding, among other things, our continued profitable
growth. 

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 2012 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 ongoing
economic and financial downturn that may cause a continued decline in consumer
spending and other changes in macroeconomic factors or market conditions that
impact consumer spending or shopping patterns, particularly for the types of
merchandise that we sell; 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;
our relationships with our vendors; 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 the products we sell, including product liability claims, and the
availability of recourse to third parties, including our insurance policies,
product recalls and the regulation of and other hazards associated with
certain products we sell, such as hunting rifles and ammunition; the loss of
our key executives, especially Edward W. Stack, our Chairman and Chief
Executive Officer; costs and risks associated with increased or changing laws
and regulations affecting our business; our ability to secure and protect our
trademarks, patents and other intellectual property; risks relating to
operating as an omni-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 investments or 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; impairment in the carrying value of goodwill or
other acquired intangibles; and our current intention to issue quarterly cash
dividends.

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 28, 2012 as
filed with the Securities and Exchange Commission ("SEC") on March 16, 2012
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 October 27, 2012, the Company operated 511 Dick's Sporting Goods stores
in 44 states, 81 Golf Galaxy stores in 30 states and eCommerce websites and
catalog operations for 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 website is not
part of this release.

Contact:

Timothy E. Kullman, EVP – Finance, Administration, and Chief Financial Officer
or
Anne-Marie Megela, Director, Investor Relations
Dick's Sporting Goods   
investors@dcsg.com 
(724) 273-3400

 

 

DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
(In thousands, except per share data)
                       13 Weeks Ended
                       October 27,     % of        October 29,      % of
                       2012            Sales ^(1)  2011             Sales ^(1)
Net sales              $   1,312,072   100.00%     $    1,179,702   100.00%
Cost of goods sold,
including occupancy
and distribution costs 905,948         69.05       829,111          70.28
GROSS PROFIT           406,124         30.95       350,591          29.72
Selling, general and
administrative         314,637         23.98       272,233          23.08
expenses
Pre-opening expenses   9,294           0.71        6,796            0.58
INCOME FROM OPERATIONS 82,193          6.26        71,562           6.07
Interest expense       860             0.07        3,540            0.30
Other (income) expense (1,113)         (0.08)      1,568            0.13
INCOME BEFORE INCOME   82,446          6.28        66,454           5.63
TAXES
Provision for income   32,307          2.46        24,970           2.12
taxes
NET INCOME             $       50,139  3.82%       $        41,484  3.52%
EARNINGS PER COMMON
SHARE:
Basic                  $                           $          
                       0.41                         0.34
Diluted                $                           $          
                       0.40                         0.33
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING:
Basic                  122,103                     120,432
Diluted                125,938                     125,552
Cash dividend declared $                           $              
per share              0.125                         -
^(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)
                           39 Weeks Ended
                           October 27,      % of     October 29,    % of
                           2012             Sales    2011           Sales ^(1)
Net sales                  $  4,030,818     100.00%  $   3,600,246  100.00%
Cost of goods sold,
including occupancy
and distribution costs     2,782,306        69.03    2,518,137      69.94
GROSS PROFIT               1,248,512        30.97    1,082,109      30.06
Selling, general and       921,631          22.86    821,698        22.82
administrative expenses
Pre-opening expenses       14,311           0.36     12,717         0.35
INCOME FROM OPERATIONS     312,570          7.75     247,694        6.88
Impairment of
available-for-sale         32,370           0.80     -              -
investments
Gain on sale of investment -                -        (13,900)       (0.39)
Interest expense           5,309            0.13     10,504         0.29
Other (income) expense     (2,923)          (0.07)   977            0.03
INCOME BEFORE INCOME TAXES 277,814          6.89     250,113        6.95
Provision for income taxes 116,855          2.90     97,283         2.70
NET INCOME                 $     160,959    3.99%    $              4.24%
                                                      152,830
EARNINGS PER COMMON SHARE:
Basic                      $                         $          
                           1.33                       1.27
Diluted                    $                         $          
                           1.28                       1.22
WEIGHTED AVERAGE COMMON
SHARES
OUTSTANDING:
Basic                      121,181                   120,000
Diluted                    125,825                   125,585
Cash dividend declared per $         0.375           $            
share                                                    -
^(1)Column does not add
due to rounding

 

DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - UNAUDITED
(Dollars in thousands)
                                October 27,     October 29,     January 28,
                                2012            2011            2012
ASSETS
CURRENT ASSETS:
Cash and cash equivalents       $      294,493  $      483,372  $      734,402
Accounts receivable, net        57,212          63,568          38,338
Income taxes receivable         2,779           35,180          4,113
Inventories, net                1,382,684       1,243,152       1,014,997
Prepaid expenses and other      35,367          63,542          64,213
current assets
Deferred income taxes           26,755          14,028          12,330
Total current assets            1,799,290       1,902,842       1,868,393
Property and equipment, net     851,302         745,129         775,896
Construction in progress -      -               -               2,138
leased facilities
Intangible assets, net          99,033          50,755          50,490
Goodwill                        200,594         200,594         200,594
Other assets:
Deferred income taxes           8,269           8,225           12,566
Other                           111,093         67,087          86,375
            Total other assets  119,362         75,312          98,941
TOTAL ASSETS                    $    3,069,581  $    2,974,632  $    2,996,452
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES:
Accounts payable                $      665,608  $      663,091  $      510,398
Accrued expenses                296,232         266,162         264,073
Deferred revenue and other      96,233          86,286          128,765
liabilities
Income taxes payable            -               -               29,484
Current portion of other
long-term debt and
leasing obligations             8,584           995             7,426
Total current liabilities       1,066,657       1,016,534       940,146
LONG-TERM LIABILITIES:
Other long-term debt and        14,157          139,108         151,596
leasing obligations
Non-cash obligations for
construction 
   in progress - leased         -               -               2,138
facilities
Deferred revenue and other      283,835         256,644         269,827
liabilities
Total long-term liabilities     297,992         395,752         423,561
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock                    977             957             964
Class B common stock            250             250             250
Additional paid-in capital      855,881         677,716         699,766
Retained earnings               1,047,668       883,298         932,871
Accumulated other               114             125             118
comprehensive income
Treasury stock                  (199,958)       -               (1,224)
Total stockholders' equity      1,704,932       1,562,346       1,632,745
TOTAL LIABILITIES AND           $    3,069,581  $    2,974,632  $    2,996,452
STOCKHOLDERS' EQUITY

DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED
(Dollars in thousands)
                                                39 Weeks Ended
                                                October 27,   October 29,
                                                2012          2011
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income                                    $  160,959    $  152,830
  Adjustments to reconcile net income   
   to net cash provided by operating
activities:
Depreciation and amortization                   88,627        83,616
Impairment of available-for-sale investments    32,370        -
Deferred income taxes                           (10,128)      27,795
Stock-based compensation                        23,643        19,075
Excess tax benefit from exercise of stock       (61,461)      (15,320)
options
Tax benefit from exercise of stock options      4,761         421
Other non-cash items                            227           1,154
Gain on sale of investment                      -             (13,900)
Changes in assets and liabilities:
Accounts receivable                             (17,374)      (17,908)
Inventories                                     (367,687)     (346,257)
Prepaid expenses and other assets               31,599        (5,858)
Accounts payable                                178,700       204,999
Accrued expenses                                18            (22,821)
Income taxes payable / receivable               33,260        (10,944)
Deferred construction allowances                21,744        21,203
Deferred revenue and other liabilities          (35,922)      (41,921)
Net cash provided by operating activities       83,336        36,164
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures                            (157,448)     (148,038)
Purchase of JJB Sports convertible notes and    (31,986)      -
equity securities
Proceeds from sale of investment                -             14,140
Proceeds from sale-leaseback transactions       -             9,071
Deposits and purchases of other assets          (54,819)      (18,052)
Net cash used in investing activities           (244,253)     (142,879)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on other long-term debt and leasing    (138,856)     (738)
obligations
Construction allowance receipts                 -             -
Proceeds from exercise of stock options         71,683        21,428
Excess tax benefit from exercise of stock       61,461        15,320
options
Minimum tax withholding requirements            (5,329)       (3,559)
Cash paid for treasury stock                    (198,774)     -
Cash dividend paid to stockholders              (45,668)      -
(Decrease) increase in bank overdraft           (23,505)      11,581
Net cash (used in) provided by financing        (278,988)     44,032
activities
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND
CASH
   EQUIVALENTS                                  (4)           3
NET DECREASE IN CASH AND CASH EQUIVALENTS       (439,909)     (62,680)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD  734,402       546,052
CASH AND CASH EQUIVALENTS, END OF PERIOD        $  294,493    $  483,372
Supplemental disclosure of cash flow
information:
Accrued property and equipment                  $    44,568   $      9,699
Accrued deposits and purchases of other assets  $    14,500   $              -
Cash paid for interest                          $      1,402  $      9,351
Cash paid for income taxes                      $  100,939    $    79,204

 

Store Count and Square Footage

The stores that opened during the third quarter of 2012 are as follows:

DICK'S
Store                                  Market
NE Columbia, SC                        Columbia, SC
Bluffton, SC                           Hilton Head, SC
Commack, NY                            Long Island, NY
Oxnard, CA                             Los Angeles, CA
Clovis, CA                             Fresno, CA
Greenville, NC                         Greenville, NC
Midvale, UT                            Salt Lake City, UT
Orem, UT                               Salt Lake City, UT
Visalia, CA                            Fresno, CA
West Nyack, NY                         New York, NY
Las Cruces, NM                         Las Cruces, NM
Huntington Beach, CA                   Los Angeles, CA
San Diego, CA                          San Diego, CA
Harrisonburg, VA                       Harrisonburg, VA            
Hanover, MA                            Boston, MA
Oneonta, NY                            Oneonta, NY
Waterford Lakes, FL                    Orlando, FL
Sanford, FL                            Orlando, FL
Aberdeen, NC                           Southern Pines, NC
Wheaton, MD                            Washington, DC
Salinas, CA                            Salinas, CA

 

The following represents a reconciliation of beginning and ending stores and
square footage for the periods indicated:

               Fiscal 2012                             Fiscal 2011
                                      Golf             Dick's    Golf
               Dick's Sporting Goods  Galaxy   Total   Sporting  Galaxy  Total
                                                       Goods
Beginning      480                    81      561      444       81      525
stores
 Q1 New        6                      -       6        3         -       3
 Q2 New        4                      -       4        8         -       8
 Q3 New        21                     -       21       19        -       19
Ending stores  511                    81      592      474       81      555
Remodeled      -                      -       -        14        -       14
stores
Relocated      4                      -       4        -         1       1
stores
Square
Footage:
(in millions)
               Dick's Sporting Goods  Golf    Total
                                      Galaxy
 Q1 2011       24.7                   1.3     26.0
 Q2 2011       25.1                   1.3     26.4
 Q3 2011       26.0                   1.3     27.3
 Q4 2011       26.3                   1.3     27.6
 Q1 2012       26.5                   1.3     27.8
 Q2 2012       26.7                   1.3     28.0
 Q3 2012       27.9                   1.3     29.2

 

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
certain non-recurring, infrequent or unusual items; 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 Reconciliations

(in thousands, except for per share data):
                           Fiscal 2012
                           39 Weeks Ended October 27, 2012
                           As                Impairment of      Non-GAAP
                           Reported          Investments        Total
Net sales                  $     4,030,818   $                  $    
                                                -               4,030,818
Cost of goods sold,
including occupancy
and distribution costs     2,782,306         -                  2,782,306
GROSS PROFIT               1,248,512         -                  1,248,512
Selling, general and       921,631           -                  921,631
administrative expenses
Pre-opening expenses       14,311            -                  14,311
INCOME FROM OPERATIONS     312,570           -                  312,570
Impairment of
available-for-sale         32,370            (32,370)           -
investments
Interest expense           5,309             -                  5,309
Other income               (2,923)           -                  (2,923)
INCOME BEFORE INCOME TAXES 277,814           32,370             310,184
Provision for income taxes 116,855           4,734              121,589
NET INCOME                 $       160,959   $         27,636   $      
                                                                188,595
EARNINGS PER COMMON SHARE:
Basic                      $                                    $            
                           1.33                                 1.56
Diluted                    $                                    $            
                           1.28                                 1.50
WEIGHTED AVERAGE COMMON
SHARES
OUTSTANDING:
Basic                      121,181                              121,181
Diluted                    125,825                              125,825
During the second quarter of 2012, the Company fully impaired its investment
in JJB Sports and recorded a pre-tax charge of $32.4 million.  The Company
recorded a deferred tax asset valuation allowance of approximately $7.9
million for a portion of the $32.4 million net capital loss carryforward that
it expects to incur as a result of the impairment of its investment in JJB
Sports.

 

                       Fiscal 2011
                       13 Weeks Ended October 29, 2011
                       As                   Litigation          Non-GAAP
                       Reported             Settlement          Total
Net sales              $     1,179,702      $                   $    
                                             -                  1,179,702
Cost of goods sold,
including occupancy
and distribution costs 829,111              -                   829,111
GROSS PROFIT           350,591              -                   350,591
Selling, general and
administrative         272,233              2,148               274,381
expenses
Pre-opening expenses   6,796                -                   6,796
INCOME FROM OPERATIONS 71,562               (2,148)             69,414
Interest expense       3,540                -                   3,540
Other expense          1,568                -                   1,568
INCOME BEFORE INCOME   66,454               (2,148)             64,306
TAXES
Provision for income   24,970               (859)               24,111
taxes
NET INCOME             $         41,484     $         (1,289)   $        
                                                                40,195
EARNINGS PER COMMON
SHARE:
Basic                  $                                        $            
                       0.34                                     0.33
Diluted                $                                        $            
                       0.33                                     0.32
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING:
Basic                  120,432                                  120,432
Diluted                125,552                                  125,552
During the third quarter of 2011, the Company funded claims submitted by class
members of wage and hour class action lawsuits as part of a court approved
settlement.  The settlement funding was $2.1 million lower than the previous
estimate of $10.8 million, recognized in the fourth quarter of 2010.  The
provision for income taxes for the litigation settlement was calculated at
40%, which approximates the Company's blended tax rate.  

 

                      Fiscal 2011
                      39 Weeks Ended October 29, 2011
                      As             Gain on Sale    Litigation    Non-GAAP
                      Reported       of Investment   Settlement    Total
Net sales             $              $               $             $    
                      3,600,246          -                 -       3,600,246
Cost of goods sold,
including occupancy
and distribution      2,518,137      -               -             2,518,137
costs
GROSS PROFIT          1,082,109      -               -             1,082,109
Selling, general and
administrative        821,698        -               2,148         823,846
expenses
Pre-opening expenses  12,717         -               -             12,717
INCOME FROM           247,694        -               (2,148)       245,546
OPERATIONS
Gain on sale of       (13,900)       13,900          -             -
investment
Interest expense      10,504         -               -             10,504
Other expense         977            -               -             977
INCOME BEFORE INCOME  250,113        (13,900)        (2,148)       234,065
TAXES
Provision for income  97,283         (5,162)         (859)         91,262
taxes
NET INCOME            $              $               $             $      
                      152,830        (8,738)         (1,289)       142,803
EARNINGS PER COMMON
SHARE:
Basic                 $                                            $          
                        1.27                                         1.19
Diluted               $                                            $          
                        1.22                                         1.14
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING:
Basic                 120,000                                      120,000
Diluted               125,585                                      125,585
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.  During
the third quarter of 2011, the Company funded claims submitted by class
members of wage and hour class action lawsuits as part of a court approved
settlement.  The settlement funding was $2.1 million lower than the previous
estimate of $10.8 million, recognized in the fourth quarter of 2010.  The
provision for income taxes for the aforementioned adjustments was calculated
at 40%, which approximates the Company's blended tax rate.  

 

                      Fiscal 2011
                      52 Weeks Ended January 28, 2012
                      As             Gain on Sale    Litigation    Non-GAAP
                      Reported       of Investment   Settlement    Total
Net sales             $              $               $             $    
                      5,211,802         -                 -        5,211,802
Cost of goods sold,
including occupancy
and distribution      3,616,921      -               -             3,616,921
costs
GROSS PROFIT          1,594,881      -               -             1,594,881
Selling, general and
administrative        1,148,268      -               2,148         1,150,416
expenses
Pre-opening expenses  14,593         -               -             14,593
INCOME FROM           432,020        -               (2,148)       429,872
OPERATIONS
Gain on sale of       (13,900)       13,900          -             -
investment
Interest expense      13,868         -               -             13,868
Other expense         26             -               -             26
INCOME BEFORE INCOME  432,026        (13,900)        (2,148)       415,978
TAXES
Provision for income  168,120        (5,162)         (859)         162,099
taxes
NET INCOME            $              $               $             $      
                      263,906        (8,738)         (1,289)       253,879
EARNINGS PER COMMON
SHARE:
Basic                 $                                            $          
                        2.19                                         2.11
Diluted               $                                            $          
                        2.10                                         2.02
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING:
Basic                 120,232                                      120,232
Diluted               125,768                                      125,768
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.  During
the third quarter of 2011, the Company funded claims submitted by class
members of a wage and hour class action lawsuit as part of a court approved
settlement.  The settlement funding was $2.1 million lower than the previous
estimate of $10.8 million, recognized in the fourth quarter of 2010. The
provision for income taxes for the aforementioned adjustments was calculated
at 40%, which approximates the Company's blended tax rate.

 

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
                                             October 27,       October 29,
                                             2012              2011
                                             (dollars in thousands)
Net income                                   $                 $        41,484
                                              50,139
Provision for income taxes                   32,307            24,970
Interest expense                             860               3,540
Depreciation and amortization                30,527            28,300
EBITDA                                       $        113,833  $        98,294
Less: Litigation settlement                  -                 (2,148)
Adjusted EBITDA, as defined                  $        113,833  $        96,146
% increase in Adjusted EBITDA                18%
                                             39 Weeks Ended
                                             October 27,       October 29,
                                             2012              2011
                                             (dollars in thousands)
Net income                                   $        160,959  $      152,830
Provision for income taxes                   116,855           97,283
Interest expense                             5,309             10,504
Depreciation and amortization                88,627            83,616
EBITDA                                       $        371,750  $      344,233
Add:   Impairment of available-for-sale      32,370            -
investments
Less:  Gain on sale of investment            -                 (13,900)
Less:  Litigation settlement                 -                 (2,148)
Adjusted EBITDA, as defined                  $        404,120  $      328,185
% increase in Adjusted EBITDA                23%

 

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.

 

                                          39 Weeks Ended
                                          October 27,    October 29,
                                          2012           2011
                                          (dollars in thousands)
Gross capital expenditures                $   (157,448)  $   (148,038)
Proceeds from sale-leaseback transactions -              9,071
Deferred construction allowances          21,744         21,203
Construction allowance receipts           -              -
Net capital expenditures                  $   (135,704)  $   (117,764)

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 only, in each case for the periods
shown.  Golf Galaxy stores and the Company's eCommerce 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
                          October 27,  October 29,  October 27,    October 29,
                          2012         2011         2012           2011
Sales % increase for the  11.2%                     10.7%
period
Same store sales %
increase for              5.1%                      3.9%
   the period
New store sales %         6.1%                      6.7%
increase (A)^(1)
Store square footage
(000's):
Beginning of period       28,054       26,462       26,714         25,122
End of period             29,202       27,315       27,853         25,975
Average for the period    28,628       26,889       27,283         25,549
Average square footage %
increase                  6.5%                      6.8%
   for the period (B)
New store productivity    94.1%                     98.9%
(A)/(B)^(1)
^(1)- Amounts do not recalculate due to rounding.

SOURCE Dick's Sporting Goods, Inc.

Website: http://www.dickssportinggoods.com
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