Dick's Sporting Goods Reports Fourth Quarter and Full Year 2012 Results
Dick's Sporting Goods Reports Fourth Quarter and Full Year 2012 Results
-- Consolidated earnings per diluted share increased 17% to $1.03 per diluted
share in the fourth quarter of 2012 compared to earnings per diluted share of
$0.88 in the fourth quarter of 2011
-- Full year consolidated non-GAAP earnings per diluted share increased 25% to
$2.53 from 2011 consolidated non-GAAP earnings per diluted share of $2.02
-- Company to make significant growth investments in 2013 for the long-term
benefit of the business and its shareholders
-- Company announces $1 billion five-year share repurchase program
PR Newswire
PITTSBURGH, March 11, 2013
PITTSBURGH, March 11, 2013 /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 fourth quarter and full year ended February
2, 2013.
Fourth Quarter Results (14 weeks compared to 13 weeks last year)
The Company reported consolidated net income for the 14 weeks ended February
2, 2013 of $129.7 million, or $1.03 per diluted share, compared to the
Company's expectations provided on November 13, 2012 of $1.03 to 1.05 per
diluted share. The fourth quarter includes approximately $0.03 per diluted
share for the 14^th week. For the fourth quarter ended January 28, 2012, the
Company reported consolidated net income of $111.1 million, or $0.88 per
diluted share.
Net sales for the 14-week quarter of 2012 increased by 12.0% to $1.8 billion,
driven by the growth of our store network, a 1.2% increase in consolidated
same store sales on a 13-week to 13-week basis, and the inclusion of the 14^th
week of sales. The 1.2% consolidated same store sales increase consisted of a
2.2% decrease at Dick's Sporting Goods stores, a 1.3% increase at Golf Galaxy
and a 54.2% increase in the eCommerce business. By chain, including eCommerce
business, Dick's Sporting Goods same store sales increased 1.2% and Golf
Galaxy same store sales increased 1.3%.
"In the fourth quarter, we experienced continued momentum in athletic footwear
and apparel along with strong sales in hunting that exceeded our expectations.
These increases were partially offset by lower-than-anticipated sales in
outerwear and cold weather accessories, as well as a significant decline in
the fitness category," said Edward W. Stack, Chairman and CEO. "As a result of
the unusually warm weather conditions, including during peak selling periods
in December, we significantly reduced our inventory levels of cold
weather merchandise to align with lower consumer demand and avoid carrying
over excess inventory after a second year in a row of warm weather. While this
was a prudent move that enabled us to effectively manage inventory and protect
our margins, it did limit our ability to capture sales in January when
temperatures dropped and snowfall increased."
Mr. Stack continued, "In fitness, the significant comp decline was a result of
lower large-equipment sales like treadmills and ellipticals. We understand the
issues that contributed to the sales decline and are taking action to correct
them."
New Stores
In 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. 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 fourth quarter, the Company operated 518 Dick's Sporting
Goods stores in 44 states, with approximately 28.2 million square feet and 81
Golf Galaxy stores in 30 states, with approximately 1.4 million square feet.
Balance Sheet
The Company ended fiscal 2012 with $345 million in cash and cash equivalents
as compared to $734 million at the end of fiscal 2011, and did not have any
outstanding borrowings under its $500 million revolving credit facility. Over
the course of the past twelve months, the Company utilized capital to fund its
$200 million 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, build a distribution
center and fund its $246 million special dividend.
Inventory per square foot was 0.7% higher at the end of the fourth quarter of
2012 as compared to the end of the fourth quarter of 2011.
Full Year 2012 Results (53 weeks compared to 52 weeks last year)
The Company reported consolidated non-GAAP net income for the 53 weeks ended
February 2, 2013 of $318.3 million, or $2.53 per diluted share, excluding an
impairment charge and including approximately $0.03 per diluted share for the
53^rd week. For the 52 weeks ended January 28, 2012, the Company reported
consolidated non-GAAP net income of $253.9 million, or $2.02 per diluted
share.
On a GAAP basis, the Company reported consolidated net income for the 53 weeks
ended February 2, 2013 of $290.7 million, or $2.31 per diluted share. For the
52 weeks ended January 28, 2012, the Company reported consolidated net income
of $263.9 million, or $2.10 per diluted share. The GAAP to non-GAAP
reconciliation is included in a table later in the release under the heading
"Non-GAAP Net Income and Earnings Per Share Reconciliation."
Net sales for the 53 weeks ended February 2, 2013 increased 12.0% from last
year's 52-week period to $5.8 billion primarily due to a 4.3% increase in
consolidated same store sales on a 52-week to 52-week comparable basis and the
growth of the Company's store network.
"In 2012, we made several important investments for the future, including
adding locations, acquiring established brands, developing and testing retail
concepts, further building omni-channel capabilities, and creating new
marketing strategies," said Mr. Stack. "All of these investments have
strengthened our foundation and position us for continued growth. We're
optimistic about our outlook for the coming year and excited about our
long-term prospects for the future."
2013 Growth Investments
The Company will make meaningful investments for the long-term benefit of the
business and its shareholders. In 2013, these growth investments include:
o Strengthening its omni-channel platform, including investments in advanced
mobile capabilities, the piloting of pick-up in-store, and growth of the
eCommerce team,
o Remodeling existing stores,
o Implementing new systems, and
o Developing new concepts.
In total, the Company expects these investments to have a $0.12 impact on
earnings per diluted share in 2013. The Company's guidance takes these
investments into consideration.
Current 2013 Outlook
The Company's current outlook for 2013 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 2013 – (52 Week Year) Comparisons to Fiscal 2012 – (53 Week
Year)
o Based on an estimated 126 million diluted shares outstanding, the
Company currently anticipates reporting consolidated earnings per
diluted share of approximately $2.84 to 2.86. For the 53 weeks ended
February 2, 2013, the Company reported consolidated non-GAAP earnings
per diluted share of $2.53, excluding an impairment charge and
including approximately $0.03 per diluted share for the 53^rd week.
On a GAAP basis, the Company reported consolidated earnings per
diluted share of $2.31 in 2012.
o Consolidated same store sales are currently expected to increase
approximately 2 to 3% on a 52-week to 52-week comparative basis,
compared to a 4.3% increase in fiscal 2012.
o The Company expects to open approximately 40 new Dick's Sporting
Goods stores, relocate one Dick's Sporting Goods store and complete
four full and 75 partial remodels of Dick's Sporting Goods stores in
2013. The Company also expects to open one new Golf Galaxy store and
relocate one Golf Galaxy store in 2013, both of which will be in the
new, larger format.
o The Company expects to open approximately two new True Runner stores
and approximately two new Field & Stream stores in 2013.
o First Quarter 2013
o Based on an estimated 126 million diluted shares outstanding,the
Company currently anticipates reporting consolidated earnings per
diluted share of approximately $0.47 to 0.49 in the first quarter of
2013, compared to first quarter 2012 earnings per diluted share of
$0.45.
o Consolidated same store sales adjusted for the shifted calendar due
to the 53^rd week in 2012 are currently expected to be approximately
negative 2% to negative 1% in the first quarter of 2013, or
approximately flat to 1% not adjusted, as compared to an 8.4%
increase in the first quarter of 2012.
o The Company expects to open approximately two Dick's Sporting Goods
stores in the first quarter of 2013.
o Capital Expenditures
o In 2013, the Company anticipates capital expenditures to be
approximately $299 million on a gross basis and approximately $258
million on a net basis.
Dividend
As previously announced on February 19, 2013, 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 March 29, 2013 to stockholders of record at the close of
business on March 8, 2013.
Share Repurchase Program
The Company announced today that its Board of Directors authorized a share
repurchase program of up to $1 billion of the Company's common stock over the
next five years. The Company currently expects to finance the repurchases from
cash on hand and if necessary, availability under its credit facility. The
Company's guidance takes into consideration expected share repurchase activity
sufficient to at least offset the dilutive effect of the issuance of shares
expected from stock-based awards. The repurchases, which may be made in
privately-negotiated transactions or in the open market as permitted by
Securities Exchange Act Rule 10b-18, including pursuant to a Securities
Exchange Act Rule 10b5-1 repurchase plan, could begin immediately and may
occur from time-to-time in the future. The Company may suspend or discontinue
this repurchase program at any time.
Conference Call Info
The Company will be hosting a conference call today at 10:00 a.m. eastern time
to discuss the fourth quarter and full year 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 10025203. 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 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 2013 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: ongoing economic and financial
uncertainties may cause a decline in consumer spending; changes in the general
economic and business conditions and in the specialty retail or sporting goods
industry in particular; competition in the sporting goods industry; changes in
consumer demand; limitations on the availability of attractive store
locations; unauthorized disclosure of sensitive or confidential customer
information; risks relating to our private brand offerings; access adequate
capital; changing laws and regulations affecting our business including the
regulation of firearms and ammunition; factors affecting our vendors;
litigation risks; foreign trade issues and currency exchange rate
fluctuations; the loss of our key executives, especially Edward W. Stack, our
Chairman and Chief Executive Officer; protection of our intellectual property;
disruptions with our eCommerce services provider or of our information
systems; disruption at our distribution facilities; developments with sports
leagues, professional athletes or sports superstars; weather and seasonality
of our business; regional risks; risk associated with strategic investments or
acquisitions; labor needs; risks associated with being a controlled company;
our anti-takeover provisions; our current intention to issue quarterly cash
dividends; and our share repurchase activity, if any.
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 or assess the impact
of all such risk factors. Forward-looking statements included in this release
are made as of the date of this release. We do not assume any obligation and
do not intend to update any forward-looking statements, whether as a result of
new information, future developments or otherwise, 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 sports and fitness
specialty omni-channel retailer offering a broad assortment of high quality,
competitively-priced 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 February 2, 2013, the Company operated 518 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)
14 Weeks Ended 13 Weeks Ended
February 2, % of January 28, % of
2013 Sales ^(1) 2012 Sales
Net sales $ 1,805,302 100.00% $ 1,611,556 100.00%
Cost of goods sold,
including
occupancy and 1,216,650 67.39 1,098,785 68.18
distribution costs
GROSS PROFIT 588,652 32.61 512,771 31.82
Selling, general and
administrative 375,781 20.82 326,570 20.26
expenses
Pre-opening expenses 1,765 0.10 1,876 0.12
INCOME FROM OPERATIONS 211,106 11.69 184,325 11.44
Interest expense 725 0.04 3,365 0.21
Other income (1,632) (0.09) (951) (0.06)
INCOME BEFORE INCOME 212,013 11.74 181,911 11.29
TAXES
Provision for income 82,264 4.56 70,835 4.40
taxes
NET INCOME $ 129,749 7.19% $ 111,076 6.89%
EARNINGS PER COMMON
SHARE:
Basic $ 1.06 $ 0.92
Diluted $ 1.03 $ 0.88
WEIGHTED AVERAGE COMMON
SHARES
OUTSTANDING:
Basic 122,875 120,928
Diluted 126,409 126,316
Cash dividends declared $ 2.125 $ 0.50
per share
^(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)
53 Weeks Ended 52 Weeks Ended
February 2, % of January 28, % of
2013 Sales^(1) 2012 Sales
Net sales $ 5,836,119 100.00% $ 5,211,802 100.00%
Cost of goods sold, including
occupancy and distribution 3,998,956 68.52 3,616,921 69.40
costs
GROSS PROFIT 1,837,163 31.48 1,594,881 30.60
Selling, general and
administrative 1,297,413 22.23 1,148,268 22.03
expenses
Pre-opening expenses 16,076 0.28 14,593 0.28
INCOME FROM OPERATIONS 523,674 8.97 432,020 8.29
Impairment of
available-for-sale 32,370 0.55 - -
investments
Gain on sale of investment - - (13,900) (0.27)
Interest expense 6,034 0.10 13,868 0.27
Other (income) expense (4,555) (0.08) 26 0.00
INCOME BEFORE INCOME TAXES 489,825 8.39 432,026 8.29
Provision for income taxes 199,116 3.41 168,120 3.23
NET INCOME $ 290,709 4.98% $ 263,906 5.06%
EARNINGS PER COMMON SHARE:
Basic $ $
2.39 2.19
Diluted $ $
2.31 2.10
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING:
Basic 121,629 120,232
Diluted 125,995 125,768
Cash dividends declared per $ $
share 2.50 0.50
^(1)Column does not add due to rounding
DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - UNAUDITED
(Dollars in thousands)
February 2, January 28,
2013 2012
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 345,214 $ 734,402
Accounts receivable, net 34,625 38,338
Income taxes receivable 15,737 4,113
Inventories, net 1,096,186 1,014,997
Prepaid expenses and other current assets 73,838 64,213
Deferred income taxes 30,289 12,330
Total current assets 1,595,889 1,868,393
Property and equipment, net 840,135 775,896
Construction in progress - leased facilities - 2,138
Intangible assets, net 98,903 50,490
Goodwill 200,594 200,594
Other assets:
Deferred income taxes 4,382 12,566
Other 147,904 86,375
Total other assets 152,286 98,941
TOTAL ASSETS $ 2,887,807 $ 2,996,452
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 507,247 $ 510,398
Accrued expenses 269,900 264,073
Deferred revenue and other liabilities 146,362 128,765
Income taxes payable 68,746 29,484
Current portion of other long-term debt and
leasing obligations 8,513 7,426
Total current liabilities 1,000,768 940,146
LONG-TERM LIABILITIES:
Other long-term debt and leasing obligations 7,762 151,596
Non-cash obligations for construction
in progress - leased facilities - 2,138
Deferred income taxes 7,413 -
Deferred revenue and other liabilities 284,540 269,827
Total long-term liabilities 299,715 423,561
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock 981 964
Class B common stock 249 250
Additional paid-in capital 874,236 699,766
Retained earnings 911,704 932,871
Accumulated other comprehensive income 112 118
Treasury stock (199,958) (1,224)
Total stockholders' equity 1,587,324 1,632,745
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,887,807 $ 2,996,452
DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED
(Dollars in thousands)
Fiscal Year Ended
February 2, January 28,
2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 290,709 $ 263,906
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 125,096 116,581
Impairment of available-for-sale 32,370 -
investments
Deferred income taxes (2,362) 25,152
Stock-based compensation 32,181 23,919
Excess tax benefit from exercise of stock (64,767) (20,768)
options
Tax benefit from exercise of stock options 4,864 664
Other non-cash items 372 1,382
Gain on sale of investment - (13,900)
Changes in assets and liabilities:
Accounts receivable (4,328) (3,350)
Inventories (81,189) (118,102)
Prepaid expenses and other assets (8,693) (9,174)
Accounts payable (13,588) 73,950
Accrued expenses (5,576) (21,410)
Income taxes payable / receivable 92,352 54,923
Deferred construction allowances 28,691 26,678
Deferred revenue and other liabilities 12,152 9,970
Net cash provided by operating activities 438,284 410,421
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (219,026) (201,807)
Purchase of JJB Sports convertible notes (31,986) -
and equity securities
Proceeds from sale of investment - 14,140
Proceeds from sale-leaseback transactions 3,406 21,126
Deposits and purchases of other assets (76,748) (33,075)
Net cash used in investing activities (324,354) (199,616)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on other long-term debt and (145,322) (995)
leasing obligations
Construction allowance receipts - -
Proceeds from exercise of stock options 78,285 33,098
Excess tax benefit from exercise of stock 64,767 20,768
options
Minimum tax withholding requirements (5,518) (3,575)
Cash paid for treasury stock (198,774) (1,224)
Cash dividends paid to stockholders (306,972) (60,460)
Increase (decrease) in bank overdraft 10,422 (10,063)
Net cash used in financing activities (503,112) (22,451)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND
CASH
EQUIVALENTS (6) (4)
NET (DECREASE) INCREASE IN CASH AND CASH (389,188) 188,350
EQUIVALENTS
CASH AND CASH EQUIVALENTS, BEGINNING OF 734,402 546,052
PERIOD
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 345,214 $ 734,402
Supplemental disclosure of cash flow
information:
Construction in progress - leased $ - $ 2,138
facilities
Accrued property and equipment $ 23,772 $ 6,199
Accrued deposits and purchases of other $ 15,000 $ -
assets
Cash paid for interest $ 5,352 $ 12,488
Cash paid for income taxes $ 117,387 $ 84,749
Store Count and Square Footage
The stores that opened during the fourth quarter of 2012 are as follows:
DICK'S
Store Market
Monroe, LA Monroe, LA
North Oklahoma City, OK Oklahoma City, OK
Moore, OK Oklahoma City, OK
Oklahoma City (Westgate), OK Oklahoma City, OK
Midwest City, OK Oklahoma City, OK
Jefferson City, MO Jefferson City, MO
Spokane, WA Spokane, WA
The following represents a reconciliation of beginning and ending stores and
square footage for the periods indicated ^(1):
Fiscal 2012 Fiscal 2011
Dick's Sporting Golf Dick's Golf
Goods Galaxy Total Sporting Galaxy Total
Goods
Beginning stores 480 81 561 444 81 525
Q1 New 6 - 6 3 - 3
Q2 New 4 - 4 8 - 8
Q3 New 21 - 21 19 - 19
Q4 New 7 - 7 6 - 6
Ending stores 518 81 599 480 81 561
Remodeled stores - - - 14 - 14
Relocated stores 5 1 6 - 1 1
Square Footage:
(in millions)
Dick's Sporting Golf Total
Goods 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
Q4 2012 28.2 1.4 29.6
^(1)Store Count and Square Footage amounts do not include our True
Runner Stores
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; calculations of consolidated and
Dick's Sporting Goods new store productivity; and same store sales results
adjusted to conform to the Company's future presentation. 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 per share data):
Fiscal 2012
53 Weeks Ended February 2, 2013
As Impairment of Non-GAAP
Reported Investments Total
Net sales $ 5,836,119 $ $ 5,836,119
-
Cost of goods sold,
including occupancy and 3,998,956 - 3,998,956
distribution costs
GROSS PROFIT 1,837,163 - 1,837,163
Selling, general and 1,297,413 - 1,297,413
administrative expenses
Pre-opening expenses 16,076 - 16,076
INCOME FROM OPERATIONS 523,674 - 523,674
Impairment of
available-for-sale 32,370 (32,370) -
investments
Interest expense 6,034 - 6,034
Other income (4,555) - (4,555)
INCOME BEFORE INCOME TAXES 489,825 32,370 522,195
Provision for income taxes 199,116 4,734 203,850
NET INCOME $ 290,709 $ 27,636 $ 318,345
EARNINGS PER COMMON SHARE:
Basic $ $
2.39 2.62
Diluted $ $
2.31 2.53
WEIGHTED AVERAGE COMMON
SHARES
OUTSTANDING:
Basic 121,629 121,629
Diluted 125,995 125,995
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 not to realize as a result of the impairment of its investment in
JJB Sports.
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 1,148,268 - 2,148 1,150,416
administrative
expenses
Pre-opening 14,593 - - 14,593
expenses
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 432,026 (13,900) (2,148) 415,978
INCOME TAXES
Provision for 168,120 (5,162) (859) 162,099
income 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 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 effective 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.
14 Weeks Ended 13 Weeks Ended
February 2, January 28,
2013 2012
(dollars in thousands)
Net income $ $
129,749 111,076
Provision for income taxes 82,264 70,835
Interest expense 725 3,365
Depreciation and amortization 36,469 32,965
EBITDA $ $
249,207 218,241
% increase in EBITDA 14%
53 Weeks Ended 52 Weeks Ended
February 2, January 28,
2013 2012
(dollars in thousands)
Net income $ $
290,709 263,906
Provision for income taxes 199,116 168,120
Interest expense 6,034 13,868
Depreciation and amortization 125,096 116,581
EBITDA $ $
620,955 562,475
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 $ $
653,325 546,427
% increase in Adjusted EBITDA 20%
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.
Fiscal Year Ended
February 2, January 28,
2013 2012
(dollars in thousands)
Gross capital expenditures $ (219,026) $ (201,807)
Proceeds from sale-leaseback transactions 3,406 21,126
Deferred construction allowances 28,691 26,678
Construction allowance receipts - -
Net capital expenditures $ (186,929) $ (154,003)
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
Quarter Ended Quarter Ended
February 2, January 28, February 2, January 28,
2013^(2) 2012 2013^(2) 2012
Sales % increase for the 7.4% 4.7%
period
Same store sales %
increase 1.2% -2.2%
(decrease) for the
period
New store sales % 6.2% 6.8%
increase (A)^(1)
Store square footage
(000's):
Beginning of period 29,202 27,315 27,853 25,975
End of period 29,588 27,596 28,202 26,256
Average for the period 29,395 27,456 28,028 26,116
Average square footage %
increase for the period 7.1% 7.3%
(B)
New store productivity 87.6% 93.5%
(A)/(B)^(1)
^(1)Amounts do not recalculate due to rounding.
^(2)Calculated on a 13-week to 13-week basis.
Fiscal 2012 Same Store Sales Reconciliation to Fiscal 2013 Presentation
The following table presents the Company's same store sales results for fiscal
2012, adjusted to conform to the Company's future presentation. Beginning in
fiscal 2013, the Company will report same store sales for Dick's Sporting
Goods stores with its eCommerce sales. The Company will also report total
eCommerce penetration, including both Dick's Sporting Goods and Golf Galaxy
eCommerce sales. Future disclosure of fiscal 2012 same store sales will
reflect the following presentation.
Quarter Ended Year Ended
April 28, July 28, October 27, February 2, February
2012 2012 2012 2013^(1) 2,
2013^(2)
Dick's Sporting Goods 8.0% 3.7% 5.3% 1.2% 4.2%
Golf Galaxy 12.6% 4.4% 2.3% 1.3% 5.5%
Consolidated 8.4% 3.8% 5.1% 1.2% 4.3%
eCommerce penetration 3.7% 3.9% 4.4% 8.6% 5.4%
to total sales
^(1)Same store sales calculated on a 13-week to 13-week basis.
^(2)Same store sales calculated on a 52-week to 52-week basis.
SOURCE Dick's Sporting Goods, Inc.
Website: http://www.dickssportinggoods.com
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