Press Release

DICK'S Sporting Goods Reports Third Quarter Results

- Consolidated non-GAAP earnings per diluted share increased 10% to $0.45, up from $0.41 last year

- Consolidated same store sales for the third quarter increased 0.4%

- Company repurchased $150 million of common stock and also declared a $0.1375 per share quarterly dividend

Company Release - 11/17/2015 7:30 AM ET

PITTSBURGH, Nov. 17, 2015 /PRNewswire/ -- DICK'S Sporting Goods, Inc. (NYSE: DKS), the largest U.S. based full-line omni-channel sporting goods retailer, today reported sales and earnings results for the third quarter ended October 31, 2015.

Third Quarter Results

The Company reported consolidated net income for the third quarter ended October 31, 2015 of $47.2 million, or $0.41 per diluted share. The Company reported consolidated net income for the third quarter ended November 1, 2014 of $49.2 million, or $0.41 per diluted share. Excluding a litigation settlement charge in the current year, net income was $51.9 million, or $0.45 per diluted share compared to the Company's expectations provided on August 18, 2015 of $0.45 to 0.48 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 Reconciliations."

Net sales for the third quarter of 2015 increased 7.6% to approximately $1.6 billion. Consolidated same store sales increased 0.4%, compared to the Company's guidance of an increase of 1 to 3%. Same store sales for DICK'S Sporting Goods increased 0.7%, while Golf Galaxy decreased 2.9%. Third quarter 2014 consolidated same store sales increased 1.1%.

"Our positive same store sales for the quarter reflected a strong back-to-school selling season tempered by slowing trends later in the quarter. Strength in athletic footwear, accessories and athletic apparel was moderated by the impact of record warm weather in more seasonal categories," said Edward W. Stack, Chairman and CEO. "With strong operational discipline, we generated earnings per share within our guided range." 

Mr. Stack continued, "As we look to the fourth quarter, we anticipate a more promotional environment. Our focus will be to actively manage our inventory levels, while continuing to take the appropriate actions to win share and strengthen our business for the long term." 

Omni-channel Development

eCommerce penetration for the third quarter of 2015 was 8.0% of total net sales, compared to 7.3% during the third quarter of 2014.

In the third quarter, the Company opened 27 new DICK'S Sporting Goods stores and seven new Field & Stream stores.  The Company also relocated five DICK'S Sporting Goods stores and remodeled two DICK'S Sporting Goods stores. Additionally, the Company closed one DICK'S Sporting Goods store. As of October 31, 2015, the Company operated 645 DICK'S Sporting Goods stores in 47 states, with approximately 34.4 million square feet, 75 Golf Galaxy stores in 29 states, with approximately 1.4 million square feet, and 19 Field & Stream stores in nine states, with approximately 1.0 million square feet.

Store count, square footage and new stores are listed in a table later in the release under the heading "Store Count and Square Footage."

In the beginning of the fourth quarter, the Company opened one new DICK'S Sporting Goods store and relocated one DICK'S Sporting Goods store, completing its 2015 store development program.

During fiscal 2015, the Company opened a total of 44 new DICK'S Sporting Goods stores and nine new Field & Stream stores. The Company also relocated seven DICK'S Sporting Goods stores and one Golf Galaxy store and remodeled two DICK'S Sporting Goods stores. Additionally, the Company closed one DICK'S Sporting Goods store and three Golf Galaxy stores.

Balance Sheet

The Company ended the third quarter of 2015 with approximately $74 million in cash and cash equivalents and approximately $342 million in outstanding borrowings under its revolving credit facility. Over the course of the last 12 months, the Company continued to invest in omni-channel growth, while returning over $360 million to shareholders through share repurchases and quarterly dividends. The Company expects to end fiscal 2015 with no outstanding borrowings under the revolving credit facility.

Total inventory increased 13.1% at the end of the third quarter of 2015 as compared to the end of the third quarter of 2014. The Company is working with its vendors to reduce its exposure to slow-selling merchandise by returning product, canceling orders and securing markdown allowances. 

Year-to-Date Results

The Company reported consolidated net income for the 39 weeks ended October 31, 2015 of $201.4 million, or $1.71 per diluted share. For the 39 weeks ended November 1, 2014, the Company reported consolidated net income of $188.7 million, or $1.55 per diluted share.

The Company reported consolidated non-GAAP net income for the 39 weeks ended October 31, 2015 of $206.1 million, or $1.75 per diluted share. For the 39 weeks ended November 1, 2014, the Company reported consolidated non-GAAP net income of $192.2 million, or a $1.58 per diluted share. The GAAP to non-GAAP reconciliations are included in a table later in the release under the heading "Non-GAAP Net Income and Earnings Per Share Reconciliations."

Net sales for the 39 weeks ended October 31, 2015 increased 8.1% from last year's period to approximately $5.0 billion, reflecting the opening of new stores and a 0.9% increase in consolidated same store sales.

Capital Allocation

During the third quarter of 2015, the Company repurchased approximately 3.2 million shares of its common stock at an average cost of $46.93 per share, for a total cost of $150 million. During the current fiscal year, the Company has repurchased approximately 5.8 million shares of its common stock at an average cost of $51.51 per share, for a total cost of $300 million. Since starting its $1 billion share repurchase authorization at the beginning of fiscal 2013, the Company has repurchased over $755 million of common stock, and has approximately $245 million remaining under the authorization.

On November 12, 2015, the Company's Board of Directors authorized and declared a quarterly dividend in the amount of $0.1375 per share on the Company's Common Stock and Class B Common Stock. The dividend is payable in cash on December 31, 2015 to stockholders of record at the close of business on December 11, 2015.

Current 2015 Outlook

The Company's current outlook for 2015 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. 

  • Full Year 2015
           
    • Based on an estimated 117 million diluted shares outstanding, the Company currently anticipates reporting consolidated non-GAAP earnings per diluted share in the range of $2.85 to 3.00, excluding a litigation settlement charge. The Company's consolidated earnings per diluted share guidance contemplates the $300 million of share repurchases executed in 2015. For the 52 weeks ended January 31, 2015, the Company reported consolidated earnings per diluted share of $2.84. Consolidated non-GAAP earnings per diluted share for the 52 weeks ended January 31, 2015 were $2.87, excluding a gain on the sale of an asset and golf restructuring charges.
           
    • Consolidated same store sales are currently expected to be approximately flat to an increase of 1%, compared to a 2.4% increase in fiscal 2014.
           
  • Fourth Quarter 2015
           
    • Based on an estimated 115 million diluted shares outstanding, the Company currently anticipates reporting consolidated earnings per diluted share in the range of $1.10 to 1.25 in the fourth quarter of 2015, compared to consolidated earnings per diluted share of $1.30 in the fourth quarter of 2014.
             
    • Consolidated same store sales are currently expected to be in the range of negative 2.0% to positive 1.0% in the fourth quarter of 2015, as compared to a 3.4% increase in the fourth quarter of 2014.
             
  • Capital Expenditures
           
    • In 2015, the Company anticipates capital expenditures to be approximately $245 million on a net basis and approximately $365 million on a gross basis. In 2014, capital expenditures were $247 million on a net basis and $349 million on a gross basis.

Conference Call Info

The Company will host a conference call today at 10:00 a.m. Eastern Time to discuss the third quarter results. Investors will have the opportunity to listen to the earnings conference call over the internet through the Company's website located at investors.DICKS.com. To listen to the live call, please go to the website at least fifteen minutes early to register, download and install any necessary audio software.

In addition to the webcast, the call can be accessed by dialing (877) 443-5743 (domestic callers) or (412) 902-6617 (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 approximately 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 10075009. The dial-in replay will be available for approximately 30 days following the live call.

Forward-Looking Statements Involving Known and Unknown Risks and Uncertainties

This release contains forward-looking statements within the meaning of the securities laws. These forward-looking statements are subject to risks and uncertainties and change based on various important factors, many of which may be beyond our control. Our future performance and actual results may differ materially from those expressed or implied in such forward-looking statements. Forward-looking statements should not be relied upon by investors as a prediction of actual results. Forward-looking statements include statements regarding, among other things, the Company's future performance, control of our inventory, making the right strategic investments, capital expenditures and outstanding borrowings in future periods.

Factors that could cause actual results to differ materially from those expressed or implied in any forward-looking statements include, but are not limited to: the weather; the promotional holiday retail environment; changes in consumer discretionary spending; competition amongst retailers in the categories we sell; changes in consumer demand or shopping patterns and our ability to identify new trends; limitations on the availability of attractive retail store sites; omni-channel growth and our development of an eCommerce platform; unauthorized disclosure of sensitive or confidential customer information; risks relating to our private brand offerings and new retail concepts; disruptions with our eCommerce service provider or our information systems; factors affecting our vendors, including supply chain and currency risks; talent needs and the loss of Edward W. Stack, our Chairman and Chief Executive Officer; disruptions of our information systems; developments with sports leagues, professional athletes or sports superstars; weather-related disruptions and seasonality of our business; and risks associated with being a controlled company.

For additional information on these and other factors that could affect our actual results, see our risk factors, which may be amended from time to time, set forth in our filings with the SEC, including our most recent Annual Report filed with the Securities and Exchange Commission on March 27, 2015. The Company disclaims and does not undertake any obligation to update or revise any forward-looking statement in this press release, except as required by applicable law or regulation. Forward-looking statements included in this release are made as of the date of this release.

About DICK'S Sporting Goods, Inc.

Founded in 1948, DICK'S Sporting Goods, Inc. is a leading omni-channel sporting goods retailer offering an extensive assortment of authentic, high-quality sports equipment, apparel, footwear and accessories. As of October 31, 2015, the Company operated 645 DICK'S Sporting Goods locations across the United States, serving and inspiring athletes and outdoor enthusiasts to achieve their personal best through a blend of dedicated associates, in-store services and unique specialty shop-in-shops dedicated to Team Sports, Athletic Apparel, Golf, Lodge/Outdoor, Fitness and Footwear.

Headquartered in Pittsburgh, PA, DICK'S also owns and operates Golf Galaxy, Field & Stream, True Runner and Chelsea Collective specialty stores. DICK'S offers its products through a content-rich eCommerce platform that is integrated with its store network and provides customers with the convenience and expertise of a 24-hour storefront. For more information, visit the Press Room or Investor Relations pages at DICKS.com.

Contacts:
Investor Relations:
Anne-Marie Megela, Vice President – Treasury Services and Investor Relations, or
Nathaniel A. Gilch, Director of Investor Relations
DICK'S Sporting Goods, Inc.
[email protected]
(724) 273-3400

Media Relations:
(724) 273-5552 or [email protected]

 

DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

(In thousands, except per share data)




13 Weeks Ended



October 31,
2015


% of
Sales


November 1,
2014


% of
Sales(1)










Net sales


$

1,642,627



100.00

%


$

1,526,675



100.00

%

Cost of goods sold, including occupancy and 
     distribution costs


1,154,251



70.27



1,074,703



70.40











GROSS PROFIT


488,376



29.73



451,972



29.60











Selling, general and administrative expenses


395,015



24.05



357,708



23.43


Pre-opening expenses


16,280



0.99



14,334



0.94











INCOME FROM OPERATIONS


77,081



4.69



79,930



5.24











Interest expense


1,076



0.07



858



0.06


Other expense (income)


1,185



0.07



(486)



(0.03)











INCOME BEFORE INCOME TAXES


74,820



4.55



79,558



5.21











Provision for income taxes


27,605



1.68



30,347



1.99











NET INCOME


$

47,215



2.87

%


$

49,211



3.22

%










EARNINGS PER COMMON SHARE:









Basic


$

0.41





$

0.42




Diluted


$

0.41





$

0.41













WEIGHTED AVERAGE COMMON SHARES 
    OUTSTANDING:









Basic


114,978





118,142




Diluted


116,506





120,002













Cash dividend declared per share


$

0.1375





$

0.1250













(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)




39 Weeks Ended



October 31,
2015


% of
Sales(1)


November 1,
2014


% of
Sales(1)










Net sales


$

5,030,914



100.00

%


$

4,654,473



100.00

%

Cost of goods sold, including occupancy and 
     distribution costs


3,519,993



69.97



3,259,063



70.02











GROSS PROFIT


1,510,921



30.03



1,395,410



29.98











Selling, general and administrative expenses


1,151,686



22.89



1,063,351



22.85


Pre-opening expenses


31,836



0.63



28,480



0.61











INCOME FROM OPERATIONS


327,399



6.51



303,579



6.52











Interest expense


2,550



0.05



2,230



0.05


Other income


(812)



(0.02)



(4,863)



(0.10)











INCOME BEFORE INCOME TAXES


325,661



6.47



306,212



6.58











Provision for income taxes


124,262



2.47



117,550



2.53











NET INCOME


$

201,399



4.00

%


$

188,662



4.05

%










EARNINGS PER COMMON SHARE:









Basic


$

1.73





$

1.58




Diluted


$

1.71





$

1.55













WEIGHTED AVERAGE COMMON SHARES 
    OUTSTANDING:









Basic


116,101





119,743




Diluted


117,739





121,734













Cash dividends declared per share


$

0.4125





$

0.3750













(1) Column does not add due to rounding

 

 

DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS - UNAUDITED

(Dollars in thousands)




October 31,
2015


November 1,
2014


January 31,
2015

ASSETS







CURRENT ASSETS:







Cash and cash equivalents


$

73,799



$

77,933



$

221,679


Accounts receivable, net


96,406



87,944



80,292


Income taxes receivable


8,719



10,361



14,293


Inventories, net


1,997,105



1,765,119



1,390,767


Prepaid expenses and other current assets


107,755



92,375



91,767


Deferred income taxes


47,789



42,133



51,586


Total current assets


2,331,573



2,075,865



1,850,384









Property and equipment, net


1,341,166



1,195,274



1,203,382


Intangible assets, net


109,827



111,195



110,162


Goodwill


200,594



200,594



200,594


Other assets:







Deferred income taxes


1,355



2,209



1,862


Other


73,912



70,395



69,814


Total other assets


75,267



72,604



71,676


TOTAL ASSETS


$

4,058,427



$

3,655,532



$

3,436,198









LIABILITIES AND STOCKHOLDERS' EQUITY







CURRENT LIABILITIES:







Accounts payable


$

941,973



$

826,945



$

614,511


Accrued expenses


345,052



307,708



283,828


Deferred revenue and other liabilities


133,593



123,665



172,259


Income taxes payable






47,698


Current portion of other long-term debt and leasing 
    obligations


575



461



537


Total current liabilities


1,421,193



1,258,779



1,118,833


LONG-TERM LIABILITIES:







Revolving credit borrowings


342,400



280,500




Other long-term debt and leasing obligations


5,477



6,108



5,913


Deferred income taxes


29,078



23,584



44,494


Deferred revenue and other liabilities


536,973



422,407



434,733


Total long-term liabilities


913,928



732,599



485,140


COMMITMENTS AND CONTINGENCIES







STOCKHOLDERS' EQUITY:







Common stock


883



925



932


Class B common stock


249



249



249


Additional paid-in capital


1,053,748



987,892



1,015,404


Retained earnings


1,623,962



1,330,542



1,471,182


Accumulated other comprehensive (loss) income


(125)



15



(73)


Treasury stock, at cost


(955,411)



(655,469)



(655,469)


Total stockholders' equity


1,723,306



1,664,154



1,832,225


TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY


$

4,058,427



$

3,655,532



$

3,436,198









 

 

DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED

(Dollars in thousands)




39 Weeks Ended



October 31,
2015


November 1,
2014

CASH FLOWS FROM OPERATING ACTIVITIES:





Net income


$

201,399



$

188,662


Adjustments to reconcile net income to net cash provided by operating activities





Depreciation and amortization


136,683



131,000


Deferred income taxes


(11,112)



(18,063)


Stock-based compensation


21,687



19,430


Excess tax benefit from exercise of stock options


(6,308)



(6,560)


Gain on sale of asset




(14,428)


Other non-cash items


442



435


Changes in assets and liabilities:





Accounts receivable


(22,556)



(14,146)


Inventories


(606,338)



(533,054)


Prepaid expenses and other assets


(18,685)



(12,870)


Accounts payable


324,832



290,216


Accrued expenses


38,817



25,532


Income taxes payable / receivable


(36,424)



(16,362)


Deferred construction allowances


118,647



87,898


Deferred revenue and other liabilities


(25,215)



(24,933)


Net cash provided by operating activities


115,869



102,757


CASH FLOWS FROM INVESTING ACTIVITIES:





Capital expenditures


(273,962)



(271,257)


Proceeds from sale of other assets




74,534


Deposits and purchases of other assets


(2,406)



(26,780)


Net cash used in investing activities


(276,368)



(223,503)


CASH FLOWS FROM FINANCING ACTIVITIES:





Revolving credit borrowings


1,019,100



1,057,600


Revolving credit repayments


(676,700)



(777,100)


Payments on other long-term debt and leasing obligations


(398)



(806)


Construction allowance receipts





Proceeds from exercise of stock options


18,668



10,671


Excess tax benefit from exercise of stock options


6,309



6,588


Minimum tax withholding requirements


(7,703)



(7,722)


Cash paid for treasury stock


(300,000)



(200,000)


Cash dividends paid to stockholders


(49,235)



(46,564)


Increase (decrease) in bank overdraft


2,630



(25,710)


Net cash provided by financing activities


12,671



16,957


EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS


(52)



(9)


NET DECREASE IN CASH AND CASH EQUIVALENTS


(147,880)



(103,798)


CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD


221,679



181,731


CASH AND CASH EQUIVALENTS, END OF PERIOD


$

73,799



$

77,933


 

 

Store Count and Square Footage


The stores that opened during the third quarter of 2015 are as follows:


Store


Market


Concept

Valparaiso, IN


Valparaiso


DICK'S Sporting Goods

Bismarck, ND


Bismarck


DICK'S Sporting Goods

Uniontown, PA


Uniontown


DICK'S Sporting Goods

Chambersburg, PA


Hagerstown


DICK'S Sporting Goods

Euless, TX


Dallas


DICK'S Sporting Goods

Chicago (Lincoln Park), IL


Chicago


DICK'S Sporting Goods

Tuscaloosa, AL


Tuscaloosa


DICK'S Sporting Goods

Tucson, AZ


Tucson


DICK'S Sporting Goods

Cullman, AL


Cullman


DICK'S Sporting Goods

Chillicothe, OH


Columbus


DICK'S Sporting Goods

Wooster, OH


Wooster


DICK'S Sporting Goods

Janesville, WI


Janesville


DICK'S Sporting Goods

Grand Island, NE


Grand Island


DICK'S Sporting Goods

Salisbury, NC


Charlotte


DICK'S Sporting Goods

Leesburg, VA


Washington, DC


DICK'S Sporting Goods

Salem, NH


Nashua


DICK'S Sporting Goods

Brownsville, TX


Brownsville


DICK'S Sporting Goods

North Haven, CT


New Haven


DICK'S Sporting Goods

Joliet, IL


Chicago


DICK'S Sporting Goods

Council Bluffs, IA


Omaha


DICK'S Sporting Goods

Oshkosh, WI


Green Bay


DICK'S Sporting Goods

Marysville, WA


Burlington


DICK'S Sporting Goods

Muskogee, OK


Muskogee


DICK'S Sporting Goods

Sevierville, TN


Knoxville


DICK'S Sporting Goods

Cerritos, CA


Huntington Beach


DICK'S Sporting Goods

Las Vegas, NV


Las Vegas


DICK'S Sporting Goods

Glendale, CA


Huntington Beach


DICK'S Sporting Goods

Hoover, AL


Birmingham


Field & Stream

North Charleston, SC


Charleston


Field & Stream

Polaris, OH


Columbus


Field & Stream (1)

Greensboro, NC


Greensboro


Field & Stream

Asheville, NC


Asheville


Field & Stream

Champaign, IL


Champaign


Field & Stream (1)

West Harrisburg, PA


Harrisburg


Field & Stream



The following represents a reconciliation of beginning and ending stores and square footage for the periods indicated:


Store Count:




Fiscal 2015


Fiscal 2014



DICK'S
Sporting
Goods
(1)


Specialty Store
Concepts
(1) (2)


Total


DICK'S
Sporting
Goods


Specialty Store
Concepts
(2)


Total

Beginning stores


603



91



694



558



84



642


Q1 New stores


9



1



10



8





8


Q2 New stores


7



1



8



8



1



9


Q3 New stores


27



9



36



24



8



32


Ending stores


646



102



748



598



93



691















Closed stores


1



3



4



1





1


Ending stores


645



99



744



597



93



690















Remodeled stores


2





2



5





5


Relocated stores


6



1



7



5



2



7




















Square Footage:





(in millions)
















DICK'S
Sporting
Goods
(1)


Specialty Store
Concepts
(1) (2)


Total

Q1 2014     






30.6



1.5



32.1


Q2 2014






30.9



1.6



32.5


Q3 2014






32.0



2.0



34.0


Q4 2014






32.3



1.9



34.2


Q1 2015






32.7



2.0



34.7


Q2 2015






33.1



2.0



35.1


Q3 2015






34.4



2.4



36.8




(1)

All-American Sports Centers, which include both a DICK'S Sporting Goods store and a Field & Stream store at one location, are reflected in both the DICK'S Sporting Goods and Specialty Store Concepts reconciliation. As of October 31, 2015, the Company operated four All-American Sports Centers.



(2)

Includes the Company's Golf Galaxy, Field & Stream, and other specialty store concepts.

 

Non-GAAP Financial Measures

In addition to reporting the Company's financial results in accordance with generally accepted accounting principles ("GAAP"), the Company believes that certain non-GAAP financial information provides users of the Company's financial information with additional useful information in evaluating operating performance between reporting periods. These measures should be viewed as supplementing, and not as an alternative or substitute for, the Company's financial results prepared in accordance with GAAP. The methods used by the Company to calculate its non-GAAP financial measures may differ significantly from methods used by other companies to compute similar measures. As a result, any non-GAAP financial measures presented herein may not be comparable to similar measures provided by other companies. A reconciliation of the Company's non-GAAP measures to the most directly comparable GAAP financial measures are provided below and on the Company's website at investors.DICKS.com.

Non-GAAP Net Income and Earnings Per Share Reconciliations:

(in thousands, except per share data):




Fiscal 2015



13 Weeks Ended October 31, 2015










As Reported


Litigation
Settlement
Charge


Non-GAAP Total

Net sales


$

1,642,627



$



$

1,642,627


Cost of goods sold, including occupancy and 
     distribution costs


1,154,251





1,154,251









GROSS PROFIT


488,376





488,376









Selling, general and administrative expenses


395,015



(7,884)



387,131


Pre-opening expenses


16,280





16,280









INCOME FROM OPERATIONS


77,081



7,884



84,965









Interest expense


1,076





1,076


Other expense


1,185





1,185









INCOME BEFORE INCOME TAXES


74,820



7,884



82,704









Provision for income taxes


27,605



3,154



30,759









NET INCOME


$

47,215



$

4,730



$

51,945









EARNINGS PER COMMON SHARE:







Basic


$

0.41





$

0.45


Diluted


$

0.41





$

0.45









WEIGHTED AVERAGE COMMON SHARES 
    OUTSTANDING:







Basic


114,978





114,978


Diluted


116,506





116,506



During the third quarter of 2015, the Company recorded a pre-tax litigation settlement charge of $7.9 million. The provision for income taxes was calculated at 40%, which approximates the Company's blended tax rate.

 

 



Fiscal 2015



39 Weeks Ended October 31, 2015










As Reported


Litigation
Settlement
Charge


Non-GAAP
Total

Net sales


$

5,030,914



$



$

5,030,914


Cost of goods sold, including occupancy and 
     distribution costs


3,519,993





3,519,993









GROSS PROFIT


1,510,921





1,510,921









Selling, general and administrative expenses


1,151,686



(7,884)



1,143,802


Pre-opening expenses


31,836





31,836









INCOME FROM OPERATIONS


327,399



7,884



335,283









Interest expense


2,550





2,550


Other income


(812)





(812)









INCOME BEFORE INCOME TAXES


325,661



7,884



333,545









Provision for income taxes


124,262



3,154



127,416









NET INCOME


$

201,399



$

4,730



$

206,129









EARNINGS PER COMMON SHARE:







Basic


$

1.73





$

1.78


Diluted


$

1.71





$

1.75









WEIGHTED AVERAGE COMMON SHARES 
    OUTSTANDING:







Basic


116,101





116,101


Diluted


117,739





117,739



During the third quarter of 2015, the Company recorded a pre-tax litigation settlement charge of $7.9 million. The provision for income taxes was calculated at 40%, which approximates the Company's blended tax rate.

 

 



Fiscal 2014



39 Weeks Ended November 1, 2014












As Reported


Gain on Sale
of Asset


Golf
Restructuring
Charges


Non-GAAP
Total

Net sales


$

4,654,473



$



$



$

4,654,473


Cost of goods sold, including occupancy and 
     distribution costs


3,259,063





(2,405)



3,256,658











GROSS PROFIT


1,395,410





2,405



1,397,815











Selling, general and administrative expenses


1,063,351



14,428



(17,960)



1,059,819


Pre-opening expenses


28,480







28,480











INCOME FROM OPERATIONS


303,579



(14,428)



20,365



309,516











Interest expense


2,230







2,230


Other income


(4,863)







(4,863)











INCOME BEFORE INCOME TAXES


306,212



(14,428)



20,365



312,149











Provision for income taxes


117,550



(5,771)



8,146



119,925











NET INCOME


$

188,662



$

(8,657)



$

12,219



$

192,224











EARNINGS PER COMMON SHARE:









Basic


$

1.58







$

1.61


Diluted


$

1.55







$

1.58











WEIGHTED AVERAGE COMMON SHARES 
    OUTSTANDING:









Basic


119,743







119,743


Diluted


121,734







121,734



During the first quarter of 2014, the Company recorded a pre-tax $14.4 million gain on sale of a Gulfstream G650 corporate aircraft. During the second quarter of 2014, the Company recorded pre-tax restructuring charges of $20.4 million including a $14.3 million non-cash impairment of trademarks and store assets, severance charges of $3.7 million resulting from the elimination of specific staff in the golf area of its DICK'S stores and consolidation of DICK'S golf and Golf Galaxy corporate and administrative functions, and a $2.4 million write-down of excess golf inventories. The provision for income taxes for the aforementioned adjustments were calculated at 40%, which approximates the Company's blended tax rate.

 

 



Fiscal 2014



52 Weeks Ended January 31, 2015












As Reported


Gain on Sale
of Asset


Golf
Restructuring
Charges


Non-GAAP
Total

Net sales


$

6,814,479



$



$



$

6,814,479


Cost of goods sold, including occupancy and 
     distribution costs


4,727,813





(2,405)



4,725,408











GROSS PROFIT


2,086,666





2,405



2,089,071











Selling, general and administrative expenses


1,502,089



14,428



(17,960)



1,498,557


Pre-opening expenses


30,518







30,518











INCOME FROM OPERATIONS


554,059



(14,428)



20,365



559,996











Interest expense


3,215







3,215


Other income


(5,170)







(5,170)











INCOME BEFORE INCOME TAXES


556,014



(14,428)



20,365



561,951











Provision for income taxes


211,816



(5,771)



8,146



214,191











NET INCOME


$

344,198



$

(8,657)



$

12,219



$

347,760











EARNINGS PER COMMON SHARE:









Basic


$

2.89







$

2.92


Diluted


$

2.84







$

2.87











WEIGHTED AVERAGE COMMON SHARES 
    OUTSTANDING:









Basic


119,244







119,244


Diluted


121,238







121,238



During the first quarter of 2014, the Company recorded a pre-tax $14.4 million gain on sale of a Gulfstream G650 corporate aircraft. During the second quarter of 2014, the Company recorded pre-tax restructuring charges of $20.4 million including a $14.3 million non-cash impairment of trademarks and store assets, severance charges of $3.7 million resulting from the elimination of specific staff in the golf area of its DICK'S stores and consolidation of DICK'S golf and Golf Galaxy corporate and administrative functions, and a $2.4 million write-down of excess golf inventories. The provision for income taxes for the aforementioned adjustments were calculated at 40%, which approximates the Company's blended 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, capital investments and certain non-recurring, infrequent or unusual items.




13 Weeks Ended



October 31,
2015


November 1,
2014



(dollars in thousands)

Net income


$

47,215



$

49,211


Provision for income taxes


27,605



30,347


Interest expense


1,076



858


Depreciation and amortization


46,087



41,229


EBITDA


$

121,983



$

121,645


Add: Litigation settlement charge


7,884




Adjusted EBITDA, as defined


$

129,867



$

121,645







% increase in adjusted EBITDA


7

%






39 Weeks Ended



October 31,
2015


November 1,
2014



(dollars in thousands)

Net income


$

201,399



$

188,662


Provision for income taxes


124,262



117,550


Interest expense


2,550



2,230


Depreciation and amortization


136,683



131,000


EBITDA


$

464,894



$

439,442


Add: Litigation settlement charge


7,884




Less: Gain on sale of asset




(14,428)


Add: Golf restructuring charges




6,043


Adjusted EBITDA, as defined


$

472,778



$

431,057







% increase in adjusted EBITDA


10

%




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.




39 Weeks Ended



October 31,
2015


November 1,
2014



(dollars in thousands)

Gross capital expenditures


$

(273,962)



$

(271,257)


Proceeds from sale-leaseback transactions





Deferred construction allowances


118,647



87,898


Construction allowance receipts





Net capital expenditures


$

(155,315)



$

(183,359)


 

 

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/dicks-sporting-goods-reports-third-quarter-results-300179810.html

SOURCE DICK'S Sporting Goods, Inc.