First-quarter profit narrowed at Big 5 Sporting Goods Corp. as rising gas prices and falling consumer confidence meant fewer shoppers made it to the malls.
For the period ended April 3, the California-based retailer earned a net income of $2.8 million, or 13 cents a share, a significant decline from $5 million, or 23 cents, in the same period a year ago.
While net sales logged an anemic 1 percent increase to $221.1 million, same-store sales fell by the same amount over the comparable period. At the same time, expenses as a percentage of revenue rose to 30.4 percent, from 28.8 percent in the previous corresponding period, denting the bottom line.
“Our sales results … reflect continued macroeconomic weakness in our markets,” said Steven Miller, the firm’s chairman, president and CEO. “Sales were negatively impacted by a decrease in customer traffic, as we believe many of our consumers reduced purchases of discretionary items in response to the challenging economic environment, characterized by rising gas prices and high unemployment.”
He added that “sales trends in the second quarter to date remain challenging as we believe that our consumer continues to be highly sensitive to the adverse economic conditions prevalent in our markets, which are concentrated in the western U.S.”
The firm now expects second-quarter comps to be either flat or negative in the low single-digit range. Earnings per share are forecast to be between 6 cents and 14 cents, down from 22 cents in the second quarter of fiscal 2010.
Big 5 Sporting Goods ended the period with 22 percent more cash, or $6.5 million, than it had a year earlier, and long-term debt of $51.8 million.