- Comparable Store Sales Increase
0.7%, with Continued High Single-Digit Comps in Footwear
- Company Opens First Store in
California
- Company Updates Guidance
Hibbett Sports, Inc. (NASDAQ/GS: HIBB), an athletic specialty
retailer, today announced results for the third quarter ended
October 29, 2016.
Third Quarter Results
Net sales for the 13-week period ended October 29, 2016,
increased 3.8% to $237.0 million compared with $228.3 million for
the 13-week period ended October 31, 2015. Comparable store sales
increased 0.7%.
Gross profit was 35.4% of net sales for the 13-week period ended
October 29, 2016, compared with 36.1% for the 13-week period ended
October 31, 2015. The decrease was mainly due to markdowns taken to
reduce inventory, a negative effect of product mix resulting from
soft sales in seasonal apparel, and de-leverage of logistics and
store occupancy expenses associated with lower comparable store
sales.
Store operating, selling and administrative expenses were 23.6%
of net sales for the 13-week period ended October 29, 2016,
compared with 21.1% of net sales for the 13-week period ended
October 31, 2015. These expenses were higher as a percentage
of net sales partially due to a low comparable store sales
increase. Additionally, the Company incurred increased expenses
related to investments in its omni-channel initiative and higher
expenses related to employee benefit costs, credit card fees, and
store maintenance.
Net income for the 13-week period ended October 29, 2016, was
$14.6 million compared with $18.7 million for the 13-week period
ended October 31, 2015. Earnings per diluted share was $0.66 for
the 13-week period ended October 29, 2016, compared with $0.79 for
the 13-week period ended October 31, 2015.
Jeff Rosenthal, President and Chief Executive Officer, stated,
"We were pleased with our back-to-school sales and continue to see
high single-digit comps in our footwear category. Sales softened in
September and October as apparel sales became more challenging,
principally in our colder-weather categories. Gross margin rate
declined due to a mix shift to footwear as a result of softness in
seasonal apparel sales. As expected, expenses were higher in the
quarter due to investments in our ongoing omni-channel initiative,
but we also experienced higher expenses in other areas against a
favorable third quarter last year.
"At the end of the quarter, we opened our first store in
California and are excited about the growth opportunity for this
state in the future," Rosenthal continued. "Additionally, we are
pleased with the progress we are making on our omni-channel
initiative and expect to see benefits from our new POS system and
store-to-home capability in the first half of Fiscal 2018."
For the quarter, Hibbett opened 13 new stores, expanded two high
performing stores and closed five underperforming stores, bringing
the store base to 1,067 in 34 states as of October 29, 2016.
Fiscal Year to Date Results
Net sales for the 39-week period ended October 29, 2016,
increased 4.1% to $726.0 million compared with $697.4 million for
the 39-week period ended October 31, 2015. Comparable store sales
increased 1.0%.
Gross profit was 35.4% of net sales for the 39-week period ended
October 29, 2016, compared with 35.5% for the 39-week period ended
October 31, 2015.
Store operating, selling and administrative expenses were 22.8%
of net sales for the 39-week period ended October 29, 2016,
compared with 21.5% of net sales for the 39-week period ended
October 31, 2015.
Net income for the 39-week period ended October 29, 2016, was
$49.0 million compared with $53.1 million for the 39-week period
ended October 31, 2015. Earnings per diluted share was $2.18 for
the 39-week period ended October 29, 2016, compared with $2.17 for
the 39-week period ended October 31, 2015.
Liquidity and Stock Repurchases
Hibbett ended the third quarter of Fiscal 2017 with $41.2
million of available cash and cash equivalents on the unaudited
consolidated balance sheet, no bank debt outstanding and full
availability under its $80.0 million unsecured credit
facilities.
During the third quarter, the Company repurchased 53,519 shares
of its common stock for a total expenditure of $1.9 million.
Approximately $269.3 million of the total authorization remained
for future stock repurchases as of October 29, 2016.
Fiscal 2017 Outlook
The Company is updating its guidance for the 52 weeks ending
January 28, 2017, to earnings per diluted share in the range of
$2.82 to $2.88 from a previously reported range of $2.93 to $3.02.
Additionally, merchandise margin is expected to be relatively flat
compared with a previously reported expectation of flat to slightly
positive versus the prior year.
Investor Conference Call and Simulcast
Hibbett Sports, Inc. will conduct a conference call at 10:00
a.m. ET on Friday, November 18, 2016, to discuss third quarter
Fiscal 2017 results. The number to call for the live interactive
teleconference is (212) 231-2905. A replay of the conference call
will be available until November 25, 2016, by dialing (402)
977-9140 and entering the passcode, 21818613.
The Company will also provide an online Web simulcast and
rebroadcast of its third quarter Fiscal 2017 conference call. The
live broadcast of Hibbett's quarterly conference call will be
available online at www.hibbett.com under Investor Relations on
November 18, 2016, beginning at 10:00 a.m. ET. The online replay
will follow shortly after the call and be available for replay for
30 days.
Hibbett Sports, Inc. operates athletic specialty stores in small
to mid-sized markets, predominately in the South, Southwest,
Mid-Atlantic and Midwest regions of the United States. The
Company's primary store format is Hibbett Sports, a
5,000-square-foot store located in strip centers and enclosed
malls.
A WARNING ABOUT FORWARD LOOKING STATEMENTS: Certain matters
discussed in this press release are "forward looking statements" as
that term is used in the Private Securities Litigation Reform Act
of 1995. Forward looking statements address future events,
developments or results and typically use words such as believe,
anticipate, expect, intend, plan, forecast, guidance, outlook, or
estimate. For example, our forward looking statements include
statements regarding earnings per diluted share, sales trends,
merchandise margin rates, impact of the omni-channel initiative and
store openings and growth opportunities. Such statements are
subject to risks and uncertainties that could cause actual results
to differ materially, including economic conditions, industry
trends, merchandise trends, vendor relationships, customer demand,
and competition. For a discussion of these factors, as well as
others which could affect our business, you should carefully review
our Annual Report and other reports filed from time to time with
the Securities and Exchange Commission, including the "Risk
Factors," "Business" and "MD&A" sections in our Annual Report
on Form 10-K filed on March 28, 2016 and in our Quarterly Report on
Form 10-Q filed on June 7, 2016 and September 9, 2016. In light of
these risks and uncertainties, the future events, developments or
results described by our forward looking statements in this
document could be materially and adversely different from those we
discuss or imply. We are not obligated to release publicly any
revisions to any forward looking statements contained in this press
release to reflect events or circumstances occurring after the date
of this report and you should not expect us to do so.
HIBBETT SPORTS, INC. AND SUBSIDIARIES Unaudited
Condensed Consolidated Statements of Operations (Dollars in
thousands, except per share amounts)
Thirteen Weeks Ended Thirty-Nine
Weeks Ended
October 29, 2016
October 31, 2015
October 29, 2016
October 31, 2015
Net sales $ 237,006 $ 228,301 $ 726,031 $ 697,385
Cost of goods sold, including wholesale,
logistics and store occupancy costs
153,181 145,949 468,947 450,140 Gross
profit 83,825 82,352 257,084 247,245 Store operating, selling and
administrative expenses 55,853 48,255 165,415 150,206 Depreciation
and amortization 4,799 4,238 14,036
12,656 Operating income 23,173 29,859 77,633 84,383 Interest
expense, net 60 67 187 201 Income
before provision for income taxes 23,113 29,792 77,446 84,182
Provision for income taxes 8,509 11,115 28,426
31,065 Net income $ 14,604 $ 18,677 $ 49,020 $ 53,117
Net income per common share: Basic earnings per share $ 0.66 $ 0.79
$ 2.19 $ 2.18 Diluted earnings per share $ 0.66 $ 0.79 $ 2.18 $
2.17 Weighted average shares outstanding: Basic
21,989 23,607 22,350 24,333 Diluted
22,186 23,777 22,525 24,519
HIBBETT SPORTS, INC. AND SUBSIDIARIES Unaudited Condensed
Consolidated Balance Sheets (In thousands)
October 29, 2016
January 30, 2016
Assets Cash and cash equivalents $ 41,195 $ 32,274
Inventories, net 292,461 283,099 Other current assets 16,557
14,995 Total current assets 350,213 330,368 Property and
equipment, net 106,601 101,389 Other assets 10,087
10,615 Total assets $ 466,901 $ 442,372
Liabilities and
Stockholders' Investment Accounts payable $ 85,710 $ 88,456
Short-term capital leases 545 478 Accrued expenses 20,877
16,256 Total current liabilities 107,132 105,190 Non-current
liabilities 27,596 26,336 Stockholders' investment 332,173
310,846 Total liabilities and stockholders' investment $
466,901 $ 442,372
HIBBETT SPORTS, INC. AND
SUBSIDIARIES Supplemental Information (Unaudited)
Thirteen Weeks Ended
Thirty-Nine Weeks Ended
October 29, 2016
October 31, 2015
October 29, 2016
October 31, 2015
Sales
Information
Net sales increase 3.8 % 4.6 % 4.1 % 3.5 % Comparable store sales
increase (decrease) 0.7 % 0.6 % 1.0 % -0.5 %
Store Count
Information
Beginning of period 1,059 1,014 1,044 988 New stores opened 13 20
44 51 Stores closed (5 ) (3 ) (21 ) (8
) End of period 1,067 1,031
1,067 1,031 Stores expanded 2 1 4 8
Estimated square footage at end of period
(in thousands)
6,090 5,893
Balance Sheet
Information
Average inventory per store $ 274,097 $ 268,611
Share Repurchase
Activity
Shares 53,519 1,341,170 911,356 2,137,389 Cost (in thousands) $
1,941 $ 50,542 $ 31,634 $ 87,944
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version on businesswire.com: http://www.businesswire.com/news/home/20161118005091/en/
Hibbett Sports, Inc.Scott J. Bowman, 205-942-4292Senior Vice
President & Chief Financial Officer
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