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Dick's Sporting Goods' CEO Discusses Q2 2012 Results - Earnings Call Transcript

Stocks in this article: DKS

For a summary of risk factors that could cause results to differ materially from those expressed in the forward-looking statements, please refer to our periodic reports filed with the SEC including the company’s annual report on Form 10(k) for the year ended January 28, 2012. We disclaim any obligation and do not intend to update these statements except as required by the Securities law.

We’ve also included some non-GAAP financial measures in our discussion today. Our presentation of the most directly comparable financial measures calculated in occurrence with generally accepted accounting principles, and a related reconciliation can be found on the Investor Relations portion of our website at www.dickssportinggoods.com.

Leading our call today will be Ed Stack, Chairman and Chief Executive Officer. Ed will review our Q2 financial and operating results, our guidance, and discuss our growth strategy. Following this, Joe Schmidt, our President and Chief Operating Officer, will outline our store and ecommerce development programs. After Joe’s comments, Tim Kullman, our Executive Vice President of Finance and Administration and Chief Financial Officer will provide greater detail regarding our financial results. I will now turn it over to Ed Stack.

Ed Stack

Thank you, Anne-Marie, and I’d like to thank all of you for joining us today. For Q2 we generated record results that exceeded expectations. On a non-GAAP basis, earnings per diluted share increased 25% to $0.65 as a result of a 10% increase in sales and an operating margin expansion of 82 basis points. We’re using the strength of our balance sheet to invest in our business with new stores, continuing developing our online channel capabilities and supporting our private brand, including the recent purchase of the Field & Stream brand and a broad range of outdoor categories.

The 10% sales increase in Q2 was driven by the growth of our store network, by a 3.8% increase in consolidated same-store sales which was on top of a 2.5% increase in Q2 of last year. Same-store sales in Q2 2012 for Dick’s Sporting Goods were up 2.9%, Golf Galaxy up 4.4%, and ecommerce sales were up 34.6%. The comp growth at Dick’s stores was broad-based with all three major categories – hard lines, apparel and footwear – comping positively.

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