Dick’s Sporting Goods sales, earnings tops Street amid gun controversy
Dick’s Sporting Goods posted a strong first quarter performance despite the predictions of guns rights advocates who said the chain’s restrictions on the sales of firearms would impact its business.
Dick’s net income totaled $60.09 million, or 59 cents per share, in the quarter ended May 5, up from $58.19 million in the year-ago period and topping analysts estimates of 45 cents per share.
Sales rose 4.6% to $1.91 billion, exceeding estimates of $1.88 billion. Online sales rose 24%.
Same-store sales fell 2.55%, a greater drop than expected. Cold spring weather led to a delayed start to outdoor activities, according to Dick’s.
Following the school shooting in Parkland, Florida, in February, Dick’s announced it would stop selling assault-style weapons, and would restrict gun and magazine sales to those younger than 21.
On the chain’s quarterly earnings call, Dick’s chairman and CEO Edward Stack said the benefits of the firearms restrictions outweighed the drawbacks. He said that consumers who support the policy have become customers even as hunting sales declined.
“There’s definitely been some benefits from people who have joined us because of the policy,” Stack said.
Dick’s increased its full-year forecast to between $2.92 and $3.12 per share, up from the previously anticipated $2.80 to $3.00 per share.
“Product newness, strength in our private brands and a more refined assortment led to a much healthier business, with fewer promotions and cleaner inventory throughout the quarter,” said Stack. “We believe these benefits will continue as we further optimize our assortments. We are also continuing to see the results of investments in our digital experience, and we will continue to invest as we build the best omni-channel experience for all athletes.”
In the first quarter, the company opened eight new Dick’s stores. As of May 5, it operated 724 namesake stores in 47 states, 94 Golf Galaxy stores in 32 states, and 35 Field & Stream stores in 16 states.