Dick's Sporting Goods says new gun policy will impact sales, shopper visits

From: Gene Poole ([email protected])

CORAOPOLIS, Pa. — Dick’s Sporting Goods on Tuesday reported
disappointing holiday sales numbers in part due to weak demand
for one-time hot brands like Under Armour.

The company’s CEO also said recent changes to its firearm
policies, ending the sale of guns to anyone under 21, will hurt
future sales and may cause fewer shoppers to come to its stores.

Last month, Dick’s stepped into the national spotlight when, in
the aftermath of a school massacre in Parkland, Florida, it
banned the sale of assault-style rifles and the sale of all guns
to anyone under 21. Other retailers followed suit, including
Walmart, which also raised its minimum age rules for firearms.

Sales fell 2 percent at established stores during the fourth
quarter, which was about double the decline that Wall Street was
expecting. Industry analysts watch that figure closely as a
barometer of a retailer’s health as it excludes the volatility
of stores recently opened or closed.

To try and improve sales, CEO Edward Stack said the company will
give more store space to its private-label brands, such as
Second Skin workout apparel. Its store brands are growing faster
than others, and Stack expects them to surpass $2 billion in
sales in a “short period of time,” but did not give an exact
time for that to happen.

Stack said that the company’s new firearms policy “is not going
to be positive from a traffic standpoint and a sales standpoint.”

Dick’s expects full-year earnings of about $2.80 to $3 per
share. Analysts polled by FactSet predict $2.79 per share.

For the period ended Feb. 3, Dick’s Sporting Goods Inc. earned
$116 million, or $1.11 per share. A year earlier the company,
based just outside of Pittsburgh in Coraopolis, Pennsylvania,
earned $90.2 million, or 81 cents per share.

Excluding certain items, earnings were $1.22 per share. That’s 2
cents better than analysts expected, according to a survey by
Zacks Investment Research.

Revenue rose to $2.66 billion, from $2.48 billion, with online
sales up about 9 percent. But that was still shy of Wall Street
projections for $2.73 billion.

Shares of Dick’s Sporting Goods Inc. ended Tuesday up 32 cents,
or about 1 percent, at $32.88 after dipping to $29.53 earlier in
the day.


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