– Delivers 4.5% Comparable Sales Growth –
– Delivers Double-Digit EBT Margin of 13.9% –
Delivered net sales of $3.47 billion, up 7.8% versus the prior year including the expected benefit from the calendar shift of approximately $95 million
Reported earnings per diluted share of $4.37, up 55% versus the prior year
Raises full year 2024 guidance for comparable sales growth to a range of 2.5% to 3.5%, up from 2.0% to 3.0% previously
Raises full year 2024 earnings per diluted share guidance to a range of $13.55 to 13.90, up from $13.35 to 13.75 previously
"Our strong second quarter demonstrated the continued success of our long-term strategies and how DICK'S is truly differentiated within the industry. We are very enthusiastic about the significant growth opportunities ahead of us, including House of Sport and the repositioning of our portfolio. The future of our business is very bright, and I'd like to thank all our teammates for their strong execution in Q2 and for their dedication to DICK'S Sporting Goods."
Ed Stack, Executive Chairman
"We delivered a very strong second quarter. Powered by our compelling omni-channel athlete experience, differentiated product assortment, best-in-class teammate experience and our ability to create deep engagement with the DICK'S brand, we are driving sustained top-line momentum and gaining market share. Our Q2 comps were driven by growth in average ticket and transactions, and with growth in sales, gross margin expansion and SG&A leverage, we delivered EBT margin of nearly 14%. Because of our strong Q2 performance and the confidence we have in our business, we are again raising our full year outlook."
Lauren Hobart, President and Chief Executive Officer
PITTSBURGH, Sept. 4, 2024 /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 second quarter ended August 3, 2024.
Second Quarter Operating Results
(dollars in millions, except per share data)
13 Weeks Ended
Change (1)
August 3, 2024
July 29, 2023
Net sales (2)
$ 3,474
$ 3,224
$ 250
7.8 %
Comparable sales (2) (3)
4.5 %
2.0 %
Income before income taxes (4)
$ 482
$ 326
$ 156
48 %
Income before income taxes (4) (% of net sales)
13.9 %
10.1 %
378 bps
Effective tax rate
24.9 %
25.0 %
(12) bps
Net income
$ 362
$ 244
$ 118
48 %
Earnings per diluted share (2)
$ 4.37
$ 2.82
$ 1.55
55 %
Year-to-Date Operating Results
(dollars in millions, except per share data)
26 Weeks Ended
Change (1)
August 3, 2024
July 29, 2023
Net sales (2)
$ 6,492
$ 6,066
$ 426
7.0 %
Comparable sales (2) (3)
4.9 %
2.7 %
Income before income taxes (4)
$ 825
$ 654
$ 171
26 %
Income before income taxes (4) (% of net sales)
12.7 %
10.8 %
192 bps
Effective tax rate
22.7 %
16.1 %
662 bps
Net income
$ 638
$ 549
$ 89
16 %
Earnings per diluted share (2)
$ 7.67
$ 6.23
$ 1.44
23 %
Balance Sheet
(in millions)
As of
August 3, 2024
As of
July 29, 2023
$
Change (1)
%
Change (1)
Cash and cash equivalents
$ 1,692
$ 1,902
$ (210)
(11) %
Inventories, net
$ 3,178
$ 2,851
$ 327
11 %
Total debt (5)
$ 1,484
$ 1,483
$ 1
— %
Capital Allocation
(in millions)
26 Weeks Ended
$
Change (1)
%
Change (1)
August 3, 2024
July 29, 2023
Share repurchases (6)
$ 164
$ 260
$ (97)
(37) %
Dividends paid (7)
$ 183
$ 189
$ (6)
(3) %
Gross capital expenditures
$ 372
$ 249
$ 124
50 %
Net capital expenditures (8)
$ 326
$ 218
$ 108
50 %
Notes
1.
Column may not recalculate due to rounding.
2.
Due to the 53rd week in fiscal 2023, there is a one-week shift in the fiscal 2024 calendar compared to the prior year, which favorably impacted net sales comparisons for the second quarter by approximately $95 million, or approximately $0.30 per diluted share, and the year-to-date period by approximately $140 million, or approximately $0.45 per diluted share. Comparable sales for fiscal 2024 are calculated by shifting the prior year period by one week to compare similar calendar weeks.
3.
Beginning in fiscal 2024, we revised our method for calculating comparable sales to include GameChanger revenue. Prior year information has been revised to reflect this change for comparability purposes. See additional details as furnished in Exhibit 99.2 of the Company's Current Report on Form 8-K, filed with the SEC on March 14, 2024.
4.
Also referred to by management as earnings before income taxes ("EBT").
5.
The Company had no outstanding borrowings under its revolving credit facility in 2024 and 2023.
6.
During the 26 weeks ended August 3, 2024, the Company repurchased 0.8 million shares of its common stock under its share repurchase program at an average price of $204.40 per share, for a total cost of $163.6 million. The Company has $616.0 million remaining under its authorization as of August 3, 2024.
7.
The Company declared and paid quarterly dividends of $1.10 per share in fiscal 2024 and $1.00 per share in fiscal 2023.
8.
For additional information, see GAAP to non-GAAP reconciliations included in tables later in the release under the heading "GAAP to Non-GAAP Reconciliations."
Quarterly Dividend
On September 3, 2024, the Company's Board of Directors authorized and declared a quarterly dividend in the amount of $1.10 per share on the Company's common stock and Class B common stock. The dividend is payable in cash on October 4, 2024 to stockholders of record at the close of business on September 20, 2024.
Full Year 2024 Outlook
The Company's Full Year Outlook for 2024 is presented below:
Metric
2024 Outlook
Earnings per diluted share
● $13.55 to 13.90
• Based on approximately 83 million diluted shares outstanding
• Based on an effective tax rate of approximately 23%
Net sales
● $13.1 billion to 13.2 billion
Comparable sales
● Growth of 2.5% to 3.5%
Capital expenditures
● Approximately $900 million on a gross basis
● Approximately $800 million on a net basis
Store Count and Square Footage
The following tables summarize store activity for the periods indicated:
26 Weeks Ended August 3, 2024
26 Weeks Ended July 29, 2023
DICK'S Sporting Goods
Specialty Concept Stores (1)
Total (2)
DICK'S Sporting Goods
Specialty Concept Stores (1)
Total (2)
Beginning stores
724
131
855
728
125
853
Q1 New stores
1
3
4
—
—
—
Q2 New stores
2
5
7
—
1
1
Stores acquired
—
—
—
—
12
12
Closed stores
2
3
5
3
3
6
Ending stores
725 (3)
136
861
725
135
860
Relocated stores
5
1
6
10
1
11
Square Footage:
(in millions)
DICK'S Sporting Goods
Specialty Concept Stores (1)
Total (2)(4)
Q1 2023
39.2
3.4
42.6
Q2 2023
39.0
3.4
42.4
Q3 2023
39.2
3.6
42.7
Q4 2023
39.3
3.4
42.7
Q1 2024
39.4
3.5
42.9
Q2 2024
39.6
3.7
43.2
(1)
Includes our Golf Galaxy, Public Lands, Going Going Gone! and other specialty concept stores. As of August 3, 2024, we operated 108 Golf Galaxy stores, 8 Public Lands stores, and 20 Going Going Gone! stores. As of July 29, 2023, we operated 97 Golf Galaxy stores, 7 Public Lands stores, 16 Going Going Gone! stores and other specialty concept stores. In some markets, we operate DICK'S Sporting Goods stores adjacent to our specialty concept stores on the same property with a pass-through for our athletes. We refer to this format as a "combo store" and include combo store openings within both the DICK'S Sporting Goods and specialty concept store reconciliations, as applicable. As of August 3, 2024, the Company operated 19 combo stores.
(2)
Excludes temporary value chain locations, of which the Company operated 32 and 38 as of August 3, 2024 and July 29, 2023, respectively.
(3)
As of August 3, 2024, includes 14 DICK'S House of Sport stores, with two new openings during the first quarter of fiscal 2024, one of which was relocated from a prior store location.
(4)
Column may not recalculate due to rounding.
Non-GAAP Financial Measures
In addition to reporting the Company's financial results in accordance with generally accepted accounting principles ("GAAP"), the Company reports certain financial results that differ from what is reported under GAAP. These non-GAAP financial measures include non-GAAP EBT margin, non-GAAP net income, non-GAAP earnings per diluted share and net capital expenditures, which management believes provides investors with useful supplemental information to evaluate the Company's ongoing operations and to compare with past and future periods. Furthermore, management believes that adjustments related to its deferred compensation plans enables investors to better understand its selling, general and administrative expense trends excluding non-cash changes in our deferred compensation plan investment fair values from market fluctuations that are offset within other income. Management also uses these non-GAAP measures internally for forecasting, budgeting, and measuring its operating performance. 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.
Forward-Looking Statements Involving Known and Unknown Risks and Uncertainties
This release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified as those that may predict, forecast, indicate or imply future results or performance and by forward-looking words such as "believe", "anticipate", "expect", "estimate", "predict", "intend", "plan", "project", "goal", "will", "will be", "will continue", "will result", "could", "may", "might" or any variations of such words or other words with similar meanings. These statements are subject to risks and uncertainties and change based on various important factors, many of which may be beyond the Company's control. The Company's 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, including 2024 outlook for earnings, sales, and capital expenditures; our growth opportunities, including sales and earnings through positive comps, higher gross margin and SG&A leverage; the repositioning of our real estate portfolio; access to differentiated products; execution of our core strategies; demand from our athletes; expected share repurchases; the expected increased dividend on an annualized basis; and the health and positioning of our inventory.
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: macroeconomic conditions, inflation, elevated interest rates and recessionary pressures, adverse changes in consumer disposable income, reinstatement of student loan payments, consumer confidence and perception of economic conditions, including the instability in the banking sector, geopolitical conflicts (including the conflicts in Ukraine and the Middle East) and the threat or outbreak of further conflicts, terrorism or public unrest and changes in consumer discretionary spending; changes in the competitive market and competition amongst retailers and increasing direct competition from vendors; fluctuations in product costs and availability; international risks and costs, including foreign trade issues, currency exchange rate fluctuations, shipment delays and supply chain disruptions and political instability; changes in consumer demand or shopping patterns and the ability to identify new trends and have the right trending products in stores and online; our investments in vertical brand offerings and new specialty concept stores; our investments in GameChanger, our sports technology platform; reputational harm or negative reactions from customers, vendors and stockholders regarding Company policy changes or advocacy efforts related to social and political issues; investments in strategic plans and initiatives not producing the anticipated benefits within the expected time-frame or at all; an ability to execute our real estate strategy and risks associated with the brick and mortar retail store model; risks related to our distribution and fulfillment network; unauthorized disclosure of sensitive or confidential customer information or disruptions or other problems with our information systems, including our eCommerce platform; our ability to hire and retain quality teammates, including store managers and sales associates, increasing labor costs or the loss of key personnel; weather-related risks and seasonality of certain categories of the Company's operations; our ability to protect against inventory shrink; the ability of suppliers, distributors and manufacturers to provide us with sufficient quantities of quality product in a timely fashion; changes in existing tax, labor, foreign trade and other laws and regulations, including those imposing new taxes, surcharges, and tariffs, and compliance with such laws and regulations; product safety and labeling concerns; various types of litigation and other claims and sufficient insurance with respect thereto; our ability to protect our intellectual property rights or claims of infringement by third parties; the performance of professional sports teams and other factors relating to professional sports leagues and key athletes; and the availability of adequate capital; the issuance of quarterly cash dividends and our repurchase activity, if any; and obligations and other provisions related to our indebtedness.
For additional information on these and other factors that could affect the Company's actual results, see the risk factors set forth in the Company's filings with the Securities and Exchange Commission ("SEC"), including the most recent Annual Report on Form 10-K, filed with the SEC on March 28, 2024. 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.
Conference Call Info
The Company will host a conference call today at 8:00 a.m. Eastern Time to discuss the second 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 ...
