(By Balaseshan) Sporting goods retailer Dicks Sporting Goods Inc. (NYSE:DKS) reported better than expected quarterly earnings due primarily to a 3.8% increase in consolidated same store sales and the opening of new stores. Further, the company raised its full year earnings outlook.
Profit for the second quarter plunged 27.3% to $53.66 million. Adjusted earnings were $81.3 million or $0.65 per share, up from $65.1 million or $0.52 per share last year.
In the second quarter, the company recorded a pre-tax impairment charge of $32.4 million related to its investment in JJB Sports, which impacted GAAP earnings per share by $0.22.
Sales grew 10.0% to $1.437 billion. Same store sales increased 3.8% for the latest quarter, which consisted of a 2.9% increase at Dick's Sporting Goods stores, a 4.4% rise at Golf Galaxy and a 34.6% increase in the eCommerce business.
Analysts, on average, surveyed by Thomson Reuters had expected a profit of $0.64 per share on revenue of $1.44 billion for the second quarter.
In the second quarter, the company opened four Dick's Sporting Goods stores. As of July 28, 2012, the company operated 490 Dick's Sporting Goods stores in 44 states, with about 26.7 million square feet and 81 Golf Galaxy stores in 30 states, with about 1.3 million square feet.
Looking ahead into the third quarter, the company expects earnings of about $0.36 per share, while Street predicts $0.36 per share. Same store sales are projected to rise about 4% compared to a 4.1% increase last year. The company anticipates openings about 21 new Dick's Sporting Goods stores and relocate three Dick's Sporting Goods stores in the third quarter.
For the fiscal 2012, the company raised its adjusted earnings guidance to range of $2.47 to $2.51 per share from previous forecast of $2.45 to $2.48 per share, while Street predicts $2.51 per share. The forecast includes about $0.03 per share for the 53rd week.
Consolidated same store sales are currently expected to increase about 4% to 5% on a 52-week to 52-week comparative basis, compared to a 2.0% increase in fiscal 2011.
In 2012, Dicks Sporting anticipates capital expenditures to be about $241 million on a gross basis and about $190 million on a net basis.
DKS closed Monday's regular session up 0.38% at $50.54. The stock has been trading between $30.21 and $52.00 for the past 52 weeks.