PITTSBURGH (BRAIN) — Dick's Sporting Goods net sales increased 53% year-over-year in the second quarter, boosted in part from its acquisition of Foot Locker last September.
Net sales for the quarter ending Aug. 1 were $5.6 billion, compared with $3.6 billion at the same time last year. Foot Locker net sales for the second quarter were $1.7 billion. Because of what Dick's calls "challenging conditions in the athletic footwear marketplace," it is lowering Foot Locker's proforma comparable sales outlook to a range of negative 2.0% to 0.0%. It also is lowering operating income outlook for both Dick's and Foot Locker but maintaining Dick's comparable sales outlook of 2.5% to 4.0% growth.
"As the quarter progressed, conditions across portions of the athletic footwear and apparel marketplace became increasingly promotional, and we took action to remain competitively priced to protect and grow our leadership position," said Ed Stack, executive chairman. "This environment had a more significant impact on the Foot Locker business given its greater exposure to legacy footwear silhouettes and greater dependence on footwear launch and retro product. Not only were there fewer launches in the second quarter, but those launches performed below both industry and our expectations. As a result, we are taking a more cautious view of the balance of the year."
Net income for the quarter was $315 million, down 17% from $381 million at the same time last year. Earnings per share decreased 19%, from $4.38 to $3.53.
Dick's received $59 million in tariff refunds and $2.1 million in related interest income during the quarter. The refunds were recorded as a reduction to cost of goods sold, and the related interest income was recorded within other income expenses on the consolidated statements of income.
Dick's Sporting Goods is traded on the New York Stock Exchange under the DKS symbol. More information: DKS stock quote at NYSE.com.
