Big 5 Sporting Goods Corporation Announces Fiscal 2014 First Quarter Results

Big 5 Sporting Goods Corporation Announces Fiscal 2014 First Quarter Results    *Achieves First Quarter Earnings per Diluted Share of $0.09    *Declares Quarterly Cash Dividend of $0.10 per Share  EL SEGUNDO, Calif., April 29, 2014 (GLOBE NEWSWIRE) -- Big 5 Sporting Goods Corporation (Nasdaq:BGFV), a leading sporting goods retailer, today reported financial results for the fiscal 2014 first quarter ended March 30, 2014.  For the fiscal 2014 first quarter, net sales were $231.3 million, compared to net sales of $246.3 million for the first quarter of fiscal 2013. Same store sales declined 7.9% for the first quarter of fiscal 2014. For comparison purposes, the Company's same store sales increased 10.5% for the first quarter of fiscal 2013 over the first quarter of the prior year. Sales results for the first quarter of fiscal 2014 reflect the anticipated reduction in demand for firearms, ammunition and related products, as well as weak sales of winter-related products due to unseasonably warm and dry conditions in most of the Company's western markets. Additionally, sales results in the fiscal 2014 first quarter reflect a small benefit over the prior year from the calendar shift of the Easter holiday, during which the Company's stores are closed, out of the first quarter and into the second quarter this year.  Gross profit for the fiscal 2014 first quarter was $72.7 million, compared to $80.5 million in the first quarter of the prior year. The Company's gross profit margin was 31.4% in the fiscal 2014 first quarter versus 32.7% in the first quarter of the prior year, reflecting a decrease in merchandise margins of 28 basis points and an increase in store occupancy costs as a percentage of net sales. For comparison purposes, merchandise margins in the first quarter last year increased by 113 basis points versus the first quarter of fiscal 2012.  Selling and administrative expense as a percentage of net sales increased to 29.8% in the fiscal 2014 first quarter from 27.6% in the first quarter of the prior year, due primarily to lower sales levels.  Net income for the first quarter of fiscal 2014 was $2.1 million, or $0.09 per diluted share, including expenses associated with the development of the Company's new e-commerce platform of $0.01 per diluted share, compared to net income of $7.5 million, or $0.34 per diluted share, for the first quarter of fiscal 2013.  "As expected, our first quarter results declined when compared to a very strong performance during the prior year, due largely to substantially reduced demand for firearms and ammunition products and soft sales of winter products resulting from warm and dry conditions in most of our western markets throughout the winter season," said Steven G. Miller, the Company's Chairman, President and Chief Executive Officer. "We were encouraged by the strength of our non-firearm and non-winter-related product categories during the quarter. Excluding sales of firearms, ammunition, firearm accessories and winter-related products, the Company's same store sales increased in the solid low single-digit range for the period. While current sales trends are somewhat difficult to read given the later timing of Easter this year, sales in the second quarter to-date have been challenged by lower than expected demand for firearms and ammunition products compared to the prior year, as well as what appears to be some softness in our overall consumer environment. That being said, we feel well positioned from a merchandise and promotional perspective for the key selling period during the quarter, which includes Memorial Day, Father's Day and the start of the summer season."  Quarterly Cash Dividend  The Company's Board of Directors has declared a quarterly cash dividend of $0.10 per diluted share, which will be paid on June 13, 2014 to stockholders of record as of May 30, 2014.  Share Repurchases  During the fiscal 2014 first quarter, pursuant to its share repurchase program, the Company repurchased 28,512 shares of its common stock for a total expenditure of $0.4 million. As of March 30, 2014, the Company had $9.2 million available for future share repurchases under its $20.0 million share repurchase program.  Guidance  For the fiscal 2014 second quarter, the Company expects same store sales comparisons in the low negative to low positive single-digit range and earnings per diluted share in the range of $0.12 to $0.20. This guidance reflects the continued softness in demand for firearms, ammunition and related products and the negative effect of the calendar shift of the Easter holiday, during which the Company's stores are closed, out of the first quarter and into the second quarter this year. In addition, second quarter guidance includes approximately $0.01 per diluted share in anticipated expenses associated with the development of the Company's e-commerce platform. For comparative purposes, the Company's same store sales increased 4.4% and earnings per diluted share were $0.28 for the second quarter of fiscal 2013.  Store Openings  During the first quarter of fiscal 2014, the Company closed four stores, two of which were part of relocations, and ended the quarter with 425 stores in operation. During the fiscal 2014 second quarter, the Company anticipates opening two new stores. For the fiscal 2014 full year, the Company currently anticipates opening approximately 12 to 15 net new stores.  Conference Call Information  The Company will host a conference call and audio webcast today, April 29, 2014, at 2:00 p.m. Pacific (5:00 p.m. EDT) to discuss financial results for the first quarter of fiscal 2014. To access the conference call, participants in North America should dial (888) 503-8169, and international participants should dial (719) 325-2429. Participants are encouraged to dial in to the conference call ten minutes prior to the scheduled start time. The call will also be broadcast live over the Internet and accessible through the Investor Relations section of the Company's website at www.big5sportinggoods.com. Visitors to the website should select the "Investor Relations" link to access the webcast. The webcast will be archived and accessible on the same website for 30 days following the call. A telephone replay will be available through May 6, 2014 by calling (877) 870-5176 to access the playback; passcode is 3362038.  About Big 5 Sporting Goods Corporation  Big 5 is a leading sporting goods retailer in the western United States, operating 425 stores in 12 states under the "Big 5 Sporting Goods" name as of the fiscal quarter ended March 30, 2014. Big 5 provides a full-line product offering in a traditional sporting goods store format that averages 11,000 square feet. Big 5's product mix includes athletic shoes, apparel and accessories, as well as a broad selection of outdoor and athletic equipment for team sports, fitness, camping, hunting, fishing, tennis, golf, snowboarding and roller sports.  Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties and other factors that may cause Big 5's actual results in current or future periods to differ materially from forecasted results. Those risks and uncertainties include, among other things, continued or worsening weakness in the consumer spending environment and the U.S. financial and credit markets, fluctuations in consumer holiday spending patterns, breach of data security or other unauthorized disclosure of sensitive personal or confidential information, the competitive environment in the sporting goods industry in general and in Big 5's specific market areas, inflation, product availability and growth opportunities, changes in the current market for (or regulation of) firearms, ammunition and certain related accessories, seasonal fluctuations, weather conditions, changes in cost of goods, operating expense fluctuations, higher than expected costs related to the development of an e-commerce platform, delay in completing the e-commerce platform, lower than expected profitability of the e-commerce platform or cannibalization of sales from Big 5's existing store base which could occur as a result of operating the e-commerce platform, litigation risks, disruption in product flow, changes in interest rates, credit availability, higher expense associated with sources of credit resulting from uncertainty in financial markets and economic conditions in general. Those and other risks and uncertainties are more fully described in Big 5's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for fiscal 2013. Big 5 conducts its business in a highly competitive and rapidly changing environment. Accordingly, new risk factors may arise. It is not possible for management to predict all such risk factors, nor to assess the impact of all such risk factors on Big 5's business or the extent to which any individual risk factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. Big 5 undertakes no obligation to revise or update any forward-looking statement that may be made from time to time by it or on its behalf.                             FINANCIAL TABLES FOLLOW  BIG 5 SPORTING GOODS CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands, except share amounts)                                                                                                                                                                                                                                              March 30, 2014 December 29,                                                                 2013 ASSETS                                                                                                                         Current assets:                                                 Cash                                             $5,902       $9,400 Accounts receivable, net of allowances of $85    9,860          16,301 and $105, respectively Merchandise inventories, net                     294,071        300,952 Prepaid expenses                                 14,690         6,356 Deferred income taxes                            10,153         12,000 Total current assets                             334,676        345,009                                                                Property and equipment, net                      73,564         75,608 Deferred income taxes                            13,348         13,564 Other assets, net of accumulated amortization of 3,192          3,274 $935 and $891, respectively Goodwill                                         4,433          4,433 Total assets                                     $429,213     $441,888                                                                LIABILITIES AND STOCKHOLDERS' EQUITY                                                                                           Current liabilities:                                            Accounts payable                                 $96,334      $104,826 Accrued expenses                                 56,598         69,923 Current portion of capital lease obligations     1,386          1,567 Total current liabilities                        154,318        176,316                                                                Deferred rent, less current portion              20,220         21,078 Capital lease obligations, less current portion  1,429          1,595 Long-term debt                                   54,219         43,018 Other long-term liabilities                      9,468          9,111 Total liabilities                                239,654        251,118                                                                Commitments and contingencies                                                                                                  Stockholders' equity:                                           Common stock, $0.01 par value, authorized 50,000,000 shares; issued 24,441,150 and         244            244 24,339,537 shares, respectively; outstanding 22,370,802 and 22,297,701 shares, respectively Additional paid-in capital                       109,285        109,901 Retained earnings                                106,395        106,565 Less:Treasury stock, at cost; 2,070,348 and     (26,365)       (25,940) 2,041,836 shares, respectively Total stockholders' equity                       189,559        190,770 Total liabilities and stockholders' equity       $429,213     $441,888                                                                BIG 5 SPORTING GOODS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except per share data)                                                                                                                                                                               13 Weeks Ended                                                 March 30, 2014 March 31, 2013                                                                                                                               Net sales                                        $231,263     $246,266                                                                Cost of sales                                    158,585       165,791                                                                Gross profit                                     72,678        80,475                                                                Selling and administrative expense               68,904        67,928                                                                Operating income                                 3,774         12,547                                                                Interest expense                                 434           453                                                                Income before income taxes                       3,340          12,094                                                                Income taxes                                     1,280         4,580                                                                Net income                                       $2,060       $7,514                                                                Earnings per share:                                             Basic                                            $0.09        $0.35                                                                Diluted                                          $0.09        $0.34                                                                Dividends per share                              $0.10        $0.10                                                                Weighted-average shares of common stock                         outstanding: Basic                                            21,980        21,453                                                                Diluted                                          22,231        21,822  CONTACT: Big 5 Sporting Goods Corporation          Barry Emerson          Sr. Vice President and Chief Financial Officer          (310) 536-0611                   ICR, Inc.          John Mills          Senior Managing Director          (310) 954-1105  
Press spacebar to pause and continue. Press esc to stop.