People exercising at home drive workout equipment sales
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Online sales at Dick's Sporting Goods nearly tripled in the second quarter, the company reported Wednesday, helping the company post one of its best quarterly sales results in history.
The Pittsburgh, Pennsylvania-based retailer founded in Binghamton, Broome County, blew through Wall Street's quarterly per share and sales projections by posting $2.7 billion in quarterly sales and earnings of $3.12 per share.
Consensus analyst estimates pegged earnings at $1.26 per share and sales at $2.45 billion.
In pre-opening trading, Dick's shares were up $4.76, a 10% rise, to $51.40.
"We had an exceptionally strong Q2 in which we delivered our highest ever quarterly sales and earnings," said company CEO Ed Stack, who attributed the strong performance to consumers buying at-home gym equipment and accessories as workout facilities across the nation were shuttered in response to the coronavirus pandemic.
"There has also been a greater shift toward athletic and active lifestyle product with people spending more time working and exercising at home," Stack said in prepared remarks accompanying Wednesday morning's earnings release.
"The majority of our assortment sits squarely at the center of these trends, and while mindful of the uncertainty in the current environment, we are in a great lane right now."
Online sales increased 194% over the same period a year ago, figures that include the company's curbside pickup. Digital sales represented 30% of the retailer's volume, up from 12% in the second quarter of 2019.
Same-store sales, a key measure of retailer health, increased 20.7%, with approximately 15% of the company's stores closed on average. By the end of June, Dick's had opened all 726 Dick's outlets and 126 Galaxy Golf and Field & Stream stores. Dick's locations include stores in Victor, Henrietta, Greece and Webster.
"We delivered positive double-digit brick-and-mortar store comps during both June and July, and our eCommerce sales remained very strong, increasing nearly 200% for the quarter," said Lauren R. Hobart, president.
Strong sales trends are continuing into the first few weeks of 2020 with same-store sales up 11% in the current quarter, the company reported.
Other large retailers such as Target and Walmart have also reported strong second quarter sales, with particular strength in the online category.
The sole disappointment in Dick's projections are back-to-school sales, which executives said are underperforming because of the uncertain status of the academic year and fall sports as districts formulate strategies to prevent the virus spread.
The improved results come even as some segments of the public pledged to boycott the chain after its controversial decision to halt the sale of semi-automatic weapons and remove the hunt category from more than 500 Dick's stores.
The company was founded 75 years ago as a single bait and tackle shop on Binghamton East Side, but began its aggressive expansion in the mid-1980s when Ed Stack took over company management from his father, Dick.