Cabela’s Tops Estimates in Q3

Third-quarter income surged at Cabela’s Inc., which also topped estimates.

The Sidney, Neb.-based firm earned $33.3 million, or 47 cents a share, up 69 percent from $19.7 million, or 29 cents, in the same period a year ago. Analysts were looking for 44 cents a share as polled by Yahoo Finance.

Revenue for the period advanced 5 percent to $678.6 million, despite comparable-store sales slipping almost 2 percent during the quarter.

Margins improved across the board: Merchandise gross margin increased 140 basis points; retail operating margin jumped 270 basis points, and direct segment operating margin grew 320 basis points.

“Our new next-generation stores continue to perform extremely well, thus increasing our confidence to accelerate future retail expansion in the U.S. and Canada,” Tommy Millner, Cabela’s CEO, said in a statement.

“Additionally, the next-generation stores have meaningfully higher return on capital than our legacy stores. Accordingly, we expect to accelerate retail expansion in the U.S. and Canada in 2013 beyond the 2012 level of five stores. This would increase retail square footage by approximately 10 percent in both 2012 and 2013,” Millner added.

The firm expects 2011 EPS to exceed current expectations, and that 2012 EPS will grow at a low double-digit rate.

Cabela’s ended the quarter with cash and cash equivalents of $81.1 million and $338.7 million in long-term debt.

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