Dick’s Sporting Goods Q2 sales boosted by comps, profit hit by inventory shrinkage
U.S. retailer Dick’s Sporting Goods said total revenues reached $3.2 billion for the second quarter, up on 3.6%, on the back of a return to comparable sales growth during the three months.
Likewise, the Pittsburgh-based company record 1.8% growth in second-quarter comparable store sales, driven by a 2.8% increase in transactions and continued market share gains.
For the six months ending July 20, the sporting goods retailer reported revenues of $6.1 billion, up 4.4% on the prior-year period.
The company said it opened seven new Dick’s House of Sport locations during the second quarter.
Despite the solid sales gains, Dick’s said net income dropped 23% to $244 million during the quarter, with profits slashed 5% to $549 million for the first six months of the year, with the retailer blaming inventory shrinkage attributed to theft.
“We are pleased with our strong sales performance for the second quarter led by robust transaction growth and continued market share gains. Within the quarter, sales accelerated significantly in July, and we remain confident in delivering positive comp sales for 2023,” said Lauren Hobart, president and chief executive officer.
“While we posted another double-digit EBT margin, our Q2 profitability was short of our expectations due in large part to the impact of elevated inventory shrink, an increasingly serious issue impacting many retailers. Despite moderating our 2023 EPS outlook, the enthusiasm we have for our business and the confidence we have in our long-term growth opportunities have never been stronger.”
Looking ahead, Dick’s reaffirmed its 2023 comparable store sales outlook in the range of flat to positive 2%. It also revised its full-year 2023 earnings per diluted share outlook to reflect second quarter results and gross margin expectations for the second half of the year.