Like-for-like (LFL) sales at Dick’s Sporting Goods Inc (NYSE:DKS) disappointed in the first quarter, sending the retailer’s shares tumbling in pre-market trading.
LFL, or same store, sales were up 2.4% on a year earlier, compared to expectations of a 3.5% rise. The company said it expects LFL sales in the current quarter will be between 2% and 3% up on last year.
Sales in the first quarter rose to US$1.83bn from US$1.66bn the year before, in line with market consensus.
The sportswear and sporting equipment seller’s net income rose to US$58.2mln, or 52 cents a share, from US$56.9mln (50 cents) the year before.
Adjusted earnings per share of 54 cents were in line with market forecasts.
The company indicated that full-year earnings per share (EPS) would fall somewhere between US$3.59 and US$3.69 while adjusted EPS, which exclude one-off items, are tipped to be somewhere between US$3.65 and US$3.75.
"In the first quarter, we generated non-GAAP earnings per diluted share near the high end of our guidance. Despite a challenging retail environment, we realized growth across each of our three primary categories of hardlines, apparel and footwear, and were pleased with the performance of our newly relaunched e-commerce site," said Edward Stack, who is not only chairman but also the chief executive officer of Dick’s.
"We remain optimistic as we drive profitable growth on our new e-commerce platform, make marked progress on our new merchandising strategy and continue to capture market share," he added.
Despite all the words about the e-commerce relaunch, the company still plans to open 13 new stores this quarter.
"Looking ahead, we continue to evaluate and adjust our business model, and are taking actions to reduce our expense structure in order to fund and develop our longer-term strategic initiatives," Stack said.
The shares were down 13% in pre-market trading.