Dick’s Sporting Goods Posts Quarterly Earnings Beat but Outlook Suggests Slower Sales in 2021

Dick’s Sporting Goods Inc. logged better-than-expected fourth-quarter financial results but provided an outlook that suggested a slowdown in sales for the year ahead.

For the three months ended Jan. 30, the Coraopolis, Penn-based retailer recorded profits of $225 million, or earnings of $2.43 per share, versus the prior year period’s profits of $113.3 million, or earnings of $1.32 per share. Wall Street had predicted earnings of $2.28 per share. Revenues grew 19.8% to $3.13 billion, beating analysts’ estimates of $3.07 billion.

According to the company, the improvement in sales was driven by a 19.3% spike in comps — including a 57% gain in e-commerce, which represented 32% of total sales, compared with 25% in the previous fourth-quarter period.

In a statement, president and CEO Lauren Hobart remarked that Dick’s management was “very pleased” with the quarterly financial results. “The strength of our diverse category portfolio, technology capabilities and advanced omnichannel execution once again helped us capitalize on the favorable shifts in consumer demand across golf, outdoor activities, home fitness and active lifestyle,” she said.

Executive chairman and chief merchandising officer Ed Stack added, “We’ve never had a year quite like 2020. We were challenged in numerous ways, as were so many others, but as an organization we not only survived — we thrived, delivering record-setting sales and earnings.”

For the full year, Dick’s reported profits of $546.2 million, or earnings of $6.12 per share, while the previous period saw profits of $329.1 million, or earnings of $3.69 per share. Revenues increased 9.5% to $9.58 billion. Despite protracted store closures from March to May, it reported a 9.9% surge in consolidated same-store sales, with e-commerce surging 100%. (Online penetration for the 52 weeks made up about 30% of total sales, versus the prior year’s 16%.)

At the end of January, the chain had approximately $1.7 billion in cash and equivalents, with no outstanding borrowings under its roughly $1.85 billion revolving credit facility.

“It’s clear that our strategies over the past several years are working and have set us up for long-term success,” Hobart said. “As we enter 2021, our business has so much momentum, and we have been pleased with our start to the year. Our focus in 2021 will center around enhancing our existing strategies to accelerate our core and enable long-term growth.”

Dick’s also offered an outlook for the upcoming fiscal year: It anticipated earnings of $4.40 through $5.20 per share and revenues in the range between $9.54 billion and $9.94 billion. Comps are forecasted to drop as much as 2% or rise 2%.

As of 8:45 a.m. ET, its stock was down nearly 7% to $71.50.

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