DICK’S Sporting Goods (DKS) Q4 2013 earnings summary

Executive summary

• Fiscal 2012 sales rose 12% to $5.836B; consolidated same-store sales increased 4.3% on a 52-week comparable basis, with growth across stores and eCommerce.

• Adjusted diluted EPS advanced 25% to $2.53 on 53 weeks; on a 52-week basis, adjusted EPS rose 24% to $2.50 vs. $2.02.

• Expanded the store network, omni-channel fulfillment, private brands and distribution capacity; ended the year with $345M cash and no revolving-credit borrowings.

Financial highlights

• Net sales were $5,836.1M vs. $5,211.8M; reported net income was $290.7M vs. $263.9M, and diluted EPS was $2.31 vs. $2.10.

• Gross profit rose 15% to $1,837.2M; operating income increased $91.7M to $523.7M.

• Adjusted net income was $318.3M vs. $253.9M; adjusted diluted EPS was $2.53 vs. $2.02, excluding the JJB impairment and prior-year items as applicable.

• Operating cash flow was $438.3M vs. $410.4M; gross capital expenditures were $219.0M vs. $201.8M.

Outlook and guidance

• FY2013 capital expenditures, net of construction allowances and sale-leaseback proceeds, expected at ~$258M, with increased investment in omni-channel, systems, concepts and stores.

• Plans called for ~40 new stores and one relocation, one new Golf Galaxy and one relocation, plus two True Runner and two Field & Stream openings.

• Planned 2013 store work included four full remodels, 75 partial remodels and installation of shared-service footwear decks in all new and fully remodeled stores.

• Expected operating cash flows and credit availability to cover FY2013 capital needs; additional opportunities or faster expansion could require funding.