Weather boosts sales at Big 5 Sporting Goods

Cold winter weather in the Western states helped Big 5 Sporting Goods post an increase in same-store sales and profit in the fourth quarter.



For the fourth quarter ended Jan. 3, the retailer said net sales increased to $275 million from net sales of $250.3 million for the fourth quarter of fiscal 2014. Same-store sales increased 0.1% for the fourth quarter of fiscal 2015 and 1.4% for the full year.



“We are pleased to have achieved earnings per share slightly above the high end of our guidance range for the fourth quarter, driven by growth in average sale and expansion of merchandise and operating margins,” said Steven G. Miller, chairman, president and CEO. “As previously reported, we delivered positive same-store sales in a highly competitive and promotional retail environment as we benefited from a positive 'Black Friday' week and very strong sales over the weeks of Christmas and New Year’s as a result of favorable winter weather conditions in most of our Western markets. We also are pleased to have further strengthened our balance sheet, ending fiscal 2015 with per-store product inventories down 2.7% from the prior year. Our operating cash flow for the year of $39.6 million allowed us to reduce borrowings under our credit facility by 17.3% to $54.8 million at year-end compared to the end of fiscal 2014, invest in new and remodeled stores and return $13 million to shareholders through cash dividends and stock repurchases.”



During the fourth quarter of fiscal 2015, the company closed one store as part of a relocation that began in the prior year, ending fiscal 2015 with 438 stores in operation. During the fiscal 2016 first quarter, the company anticipates closing four stores, one of which is part of a prior relocation. For the fiscal 2016 full year, the company currently anticipates opening approximately five to eight new stores and closing approximately 10 stores.



“For the first quarter to date, our sales are comping up in the low-single-digit range," Miller said. "While we experienced very strong sales in January on the strength of favorable winter weather conditions, sales over most of February were disappointing as winter business decelerated when weather conditions turned unseasonably warm in several of our major markets and we also experienced softness in non-winter product categories. We believe that the recent softness in our sales is reflective of the challenging retail environment along with highly promotional competitive activity in our sector. Although these headwinds could persist, we feel our product assortments are well positioned as we transition to the spring selling season. Our decision today to raise our quarterly dividend by 25% reflects the health of our financial condition and our continued commitment to delivering strong returns to stockholders."



For the fiscal 2016 first quarter, the company expects same store sales to be in the negative low single-digit to positive low single-digit range and earnings to be in the range of a net loss of 5 cents per share to a positive 2 cents per share.