Sportsman’s Warehouse’s Q3 Revenues Climb 59 Percent

Article From：SGB Media

 

Sportsman’s Warehouse reported net income jumped nearly three-fold in the third quarter ended October 31 as sales grew 59.1 percent.

 

“Sportsman’s Warehouse continued its exceptional performance in the third quarter of 2020. We were extremely pleased with the efforts of associates in all of our facilities as we worked as a team to safely and effectively serve customers, both new and returning,” said Jon Barker, Sportsman’s Warehouse CEO. “During the third quarter, same-store sales increased 41 percent compared to the same period last year, driven by elevated participation in fishing, camping and hunting, and our continued market share gains in firearms.”

 

Barker stated, “We continue to be excited about the expansion of our e-commerce capabilities, with e-commerce-driven sales up over 200 percent from the prior-year period. We are also highly encouraged by the strong visitor traffic on both our website and inside of our stores. We opened 9 new stores year-to-date in 2020, taking the total Sportsman’s Warehouse store count to 111. In addition, our first Legacy Shooting Center, which opened earlier this year, is performing ahead of expectations.”

 

“We believe we are well-positioned to continue to capitalize on substantial growth opportunities, including heightened participation in outdoor activities, e-commerce growth, and new store expansion to create long-term shareholder value.”

 

For The Thirteen Weeks Ended October 31, 2020

Net sales were $385.7 million, an increase of $143.2 million, or 59.1 percent, as compared to the third quarter of fiscal year 2019. The net sales increase was primarily due to a surge in demand across all major categories, led by our hunting and shooting category, as well as strong growth in our e-commerce platform compared to the prior-year period.

 

Same-store sales increased 40.9 percent during the third quarter of 2020 compared to the third quarter of 2019.

 

Gross profit was $130.6 million or 33.9 percent of net sales, compared to $84.2 million or 34.7 percent of net sales in the comparable prior-year period, a year-over-year increase of $46.4 million in gross profit and an 80-basis point decrease in gross profit margin.

 

Net income was $30.5 million compared to net income of $10.5 million in the third quarter of 2019. Adjusted net income was $31.5 million compared to adjusted net income of $10.8 million in the third quarter of 2019.

 

Adjusted EBITDA was $49.9 million compared to $23.2 million in the comparable prior-year period.

 

Diluted earnings per share were $0.68 compared to diluted earnings per share of $0.24 in the comparable prior-year period. Adjusted diluted earnings per share were $0.71 compared to adjusted diluted earnings per share of $0.25 for the comparable prior-year period.

 

Adjusted EPS of 71 cents a share topped Wall Street’s consensus estimate of 52 cents. Revenues of $385.7 million came in well ahead of Wall Street’s consensus estimate of $326.15 million.

 

For The Thirty-Nine Weeks Ended October 31, 2020

Net sales were $1,013.6 million, an increase of $385.3 million, or 61.3 percent, as compared to the first three quarters of fiscal year 2019. The net sales increase was primarily due to a surge in demand across all major categories, led by our hunting and shooting category, as well as strong growth in our e-commerce platform compared to the prior-year period.

 

Same-store sales increased 44.4 percent during the first three quarters of 2020 compared to the comparable period in 2019.

 

Gross profit was $334.5 million or 33.0 percent of net sales, as compared to $211.6 million or 33.7 percent of net sales for the comparable prior-year period, a year-over-year increase of $122.9 million in gross profit and a 70-basis point decrease in gross profit margin.

 

Net income was $61.8 million compared to net income of $10.5 million in the first quarters of 2019. Adjusted net income was $65.6 million compared to adjusted net income of $11.3 million in the first three quarters of 2019.

 

Adjusted EBITDA was $111.7 million compared to $39.4 million in the first three quarters of 2019.

 

Diluted earnings per share were $1.40 for the thirty-nine weeks ended October 31, 2020 compared to diluted earnings per share of $0.24 for the same period last year. Adjusted diluted earnings per share were $1.48 for the thirty-nine weeks ended October 31, 2020 compared to adjusted diluted earnings per share of $0.26 for the same period last year.

 

Balance Sheet Highlights As Of October 31, 2020

The company was in a net cash position at the end of the third quarter of 2020 with of $19.3 million in cash on hand, no borrowings under the company’s revolving credit facility, and $8.0 million outstanding under the term loan, net of unamortized debt issuance costs. This is an improvement in net debt of $170.1 million year-over-year. Total liquidity was $238 million as of the end of the second quarter of 2020, comprised of $218 million of availability on the revolving credit facility and $19 million of cash on hand, compared to $80 million in total liquidity at the end of the third quarter of 2019.

 

Fourth Quarter And Fiscal Year 2020 Outlook

For the fourth quarter of fiscal year 2020, net sales are expected to be in the range of $356 million to $386 million based on same-store sales growth in the range of 32 percent to 42 percent compared to the corresponding period of fiscal year 2019. Adjusted EBITDA is expected to be in the range of $31.0 million to $35.0 million with diluted earnings per share of $0.39 to $0.45 on a weighted average of approximately 44.5 million estimated common shares outstanding.

 

For fiscal year 2020, net sales are expected to be in the range of $1,370 million to $1,400 million based on same-store sales growth in the range of 42 percent to 46 percent compared to fiscal year 2019. Adjusted EBITDA is expected to be in the range of $143.6 million to $147.2 million with adjusted earnings per diluted share of $1.87 to $1.93 on a weighted average of approximately 44.3 million estimated common shares outstanding.