Hibbett Reports First Quarter Fiscal 2018 Results
Hibbett Sports, Inc. (NASDAQ/GS: HIBB):
First Quarter EPS of $0.97 in Line with Recent Business Update
Comparable Store Sales Decrease 4.9% in First Quarter
Updates Fiscal 2018 Outlook
Hibbett Sports, Inc. (NASDAQ/GS: HIBB), an athletic specialty retailer,
today announced results for the first quarter ended April 29, 2017.
First Quarter Results
Net sales for the 13-week period ended April 29, 2017, decreased 2.3% to
$275.7 million compared with $282.1 million for the 13-week period ended
April 30, 2016. Comparable store sales decreased 4.9%.
Gross profit was 35.6% of net sales for the 13-week period ended April
29, 2017, compared with 37.2% for the 13-week period ended April 30,
2016. The decrease was mainly due to markdowns taken to liquidate excess
and aged inventory, and de-leverage of logistics and store occupancy
expenses associated with lower comparable store sales.
Store operating, selling and administrative expenses were 21.2% of net
sales for the 13-week period ended April 29, 2017, compared with 19.9%
of net sales for the 13-week period ended April 30, 2016. The increase
was mainly due to de-leverage associated with lower comparable store
sales and continued investments in the Companys omni-channel initiative.
Net income for the 13-week period ended April 29, 2017, was $20.9
million compared with $27.9 million for the 13-week period ended April
30, 2016. Earnings per diluted share was $0.97 for the 13-week period
ended April 29, 2017, compared with $1.22 for the 13-week period ended
April 30, 2016.
Jeff Rosenthal, President and Chief Executive Officer, stated, "After a
double-digit decline in comparable store sales in February, trends
improved in March and April with comparable store sales in the positive
low to mid-single-digit range. However, the sales shortfall in February
was not fully offset, which led to a 4.9% decline in comparable store
sales for the quarter. Footwear continued to perform well with
comparable store sales in the positive low single-digit range, but
apparel and equipment posted negative comparable store sales. Gross
margin was also negatively affected due to markdowns taken to manage
inventory, although this enabled us to reduce inventory to levels below
last year. Given the softer sales environment, we were able to keep
tight controls on expenses, which helped overall profitability.
"During the quarter, we implemented our store-to-home capability in all
stores, and we are encouraged by the early results," Rosenthal
continued. "We expect to see increased benefits from this initiative
going forward, as it gives our stores a great tool to improve sales and
to enhance the customer experience. Additionally, we are excited about
the continued progress on our e-commerce initiative and remain on track
to launch this capability in the third quarter."
For the quarter, Hibbett opened 13 new stores, expanded four high
performing stores and closed nine underperforming stores, bringing the
store base to 1,082 in 35 states as of April 29, 2017.
Liquidity and Stock Repurchases
Hibbett ended the first quarter of Fiscal 2018 with $75.9 million of
available cash and cash equivalents on the consolidated balance sheet,
no bank debt outstanding and full availability under its $80.0 million
unsecured credit facilities.
During the first quarter, the Company repurchased 748,134 shares of
common stock for a total expenditure of $22.3 million. Approximately
$236.2 million of the total authorization remained for future stock
repurchases as of April 29, 2017.
Fiscal 2018 Outlook
The Company is updating its guidance for Fiscal 2018 with the following
Earnings per diluted share in the range of $2.35 to $2.55 (as reported
in the recent business update), which compares with previous guidance
of $2.65 to $2.85.
Comparable store sales in the range of negative 1.0% to positive 1.0%,
which compares with previous guidance of an increase in the low
A reduction in gross margin rate of 55-75 basis points, which compares
with previous guidance of a relatively flat gross margin rate compared
with Fiscal 2017.
Investor Conference Call and Simulcast
Hibbett Sports, Inc. will conduct a conference call at 10:00 a.m. ET on
Thursday, May 18, 2017, to discuss first quarter Fiscal 2018 results.
The number to call for the live interactive teleconference is (212)
231-2909. A replay of the conference call will be available until May
25, 2017, by dialing (402) 977-9140 and entering the passcode, 21850159.
The Company will also provide an online Web simulcast and rebroadcast of
its first quarter Fiscal 2018 conference call. The live broadcast of
Hibbetts quarterly conference call will be available online at www.hibbett.com
under Investor Relations on May 18, 2017, 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 Companys 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, comparable store sales, product gross margin
rates and merchandising initiatives. 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, 2017. 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)
Cost of goods sold, wholesale and logistics facility and store
Store operating, selling and administrative expenses
Depreciation and amortization
Interest expense, net
Income before provision for income taxes
Provision for income taxes
Net income per common share:
Basic earnings per share
Diluted earnings per share
Weighted average shares outstanding:
HIBBETT SPORTS, INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Balance Sheets
Cash and cash equivalents
Other current assets
Total current assets
Property and equipment, net
Liabilities and Stockholders Investment
Short-term capital leases
Total current liabilities
Total liabilities and stockholders investment
HIBBETT SPORTS, INC. AND SUBSIDIARIES
Net sales (decrease) increase
Comparable store sales (decrease) increase
Beginning of period
Estimated square footage at end of period (in thousands)
Balance Sheet Information
Average inventory per store
Cost (in thousands)
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SOURCE: Hibbett Sports, Inc.
Scott J. Bowman, 205-942-4292
Senior Vice President & Chief Financial Officer