Dick's Sporting Q4 Profit Meets View, Sales Top; Provides Weak Outlook

(RTTNews) - Sporting goods retailer Dick's Sporting Goods, Inc. (DKS) reported Tuesday a profit for the fourth quarter that grew from last year, reflecting relatively strong holiday sales.

Earnings per share matched analysts' expectations and quarterly revenues topped their estimates. However, the company provided earnings guidance for the first quarter and full-year 2014, both below Street view.

"We generated strong results in our fourth quarter, with record earnings per share of $1.11, above the upper end of the guidance range we provided in our third quarter press release, as our sales and merchandise margin exceeded our expectations," Chairman and CEO Edward Stack said in a statement.

The Pittsburgh, Pennsylvania-based company reported net income of $138.64 million or $1.11 per share for the fourth-quarter, higher than $129.75 million or $1.03 per share in the prior-year quarter, which included about $0.03 per share for the 14th week.

On average, 27 analysts polled by Thomson Reuters estimated the company to report earnings of $1.11 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter increased 7.9 percent to $1.95 billion from $1.81 billion in the same quarter last year, and topped twenty-three Wall Street analysts' consensus estimate of $1.94 billion by a whisker. Net sales grew 12.5 percent on a on a 13-week basis.

The sales growth was attributable to consolidated same store sales growth, the opening of new stores, as well as strong e-commerce sales, which was 12.5 percent of total sales.

Consolidated same store sales increased 6.3 percent, with DICK'S Sporting Goods increasing 6.8 percent, while Golf Galaxy decreased 9.4 percent.

Adjusted for the additional 14th week in the year-ago quarter, consolidated same store sales increased 7.3 percent on a 13-week basis, with DICK'S Sporting Goods increasing 7.9 percent, while Golf Galaxy decreased 11.7 percent.

During the fourth quarter, the company opened six new DICK'S Sporting Goods stores, one new True Runner store and closed three underperforming Golf Galaxy stores, while also remodeling one DICK'S Sporting Goods store.

Looking ahead to the first quarter, Dick's Sporting continues to anticipate earnings in a range of $0.51 to $0.53 per share, on projected consolidated same store sales increase of 3 to 4 percent. Analysts expect the company to report earnings of $0.54 per share on revenues of $1.47 billion for the quarter.

For fiscal 2014, the company currently expects earnings in a range of $3.03 to $3.08 per share, on projected consolidated same store sales growth of 3 to 4 percent. Street is currently looking for full-year 2014 earnings of $3.11 per share on annual revenues of $6.85 billion.

"As we look to 2014, we believe our robust and growing omni-channel network and exciting merchandising opportunities will support double-digit growth in earnings," Stack added.

DKS closed Monday's regular trading session at $54.33, up $0.51 on a volume of 2.26 million shares. In the past 52-week period, the stock has been trading in a range of $45.44 to $58.87.