- Dick's Sporting Goods says same-store sales fell 2 percent during the fourth quarter.
- Earnings for the holiday period slightly top analysts' expectations, but revenue comes in short.
- According to CEO Ed Stack: "Margins remained under pressure, however the decline was less than we anticipated."
Its shares were down more than 8 percent in early trading following the announcement.
Net income totaled $116 million, or $1.11 a share, for the quarter ended Feb. 3, compared with $90.2 million, or 81 cents per share, a year ago.
Excluding one-time items, the company earned $1.22 a share, 2 cents above analysts' estimates in a Thomson Reuters survey.
Revenue was $2.66 billion, below analysts' expectations for $2.74 billion in sales.
Same-store sales were down 2 percent overall for the holiday period, Dick's said, while analysts had forecast a decline of just 1 percent. Same-store sales grew 5 percent during the period a year earlier.
"As expected, margins remained under pressure, however the decline was less than we anticipated," CEO Ed Stack said in a statement. "In 2018, we expect stronger product innovation from select key partners and the continued expansion of our private brands to result in less margin pressure than previously expected."
Dick's said it will no longer provide analysts and investors with a quarterly outlook "to more closely align with industry practices."
The company is calling for full-year earnings per share to fall within a range of $2.80 to $3. Same-store sales are expected to decline as much as a low-single digit percentage, compared with a 0.3 percent drop in fiscal 2017.
Dick's said it expects to open about 19 stores in 2018 and to relocate four shops to different buildings. It's not planning to open any new Field & Stream or Golf Galaxy stores this year.
For Dick's, "some of the positives are being overlooked," Wells Fargo analyst Ike Boruchow has said. This includes favorable winter weather, an Eagles Super Bowl championship that likely lifted sales, and new regulations for Little League baseball bats that recently went into effect, which should draw shoppers into stores this spring for replacements.
To be sure, the retailer faces continued pressure from discount retailers and Amazon to offer items at lower prices. Brands like Nike and Under Armour are investing in selling more merchandise directly to consumers.
Dick's private-label lines, including Second Skin and Calia by Carrie Underwood, are one way the company is trying to combat margin pressure. It's also been making a bigger push to win shoppers online, and e-commerce sales grew 9 percent during the fourth quarter.
Shares of Dick's Sporting Goods have fallen more than 37 percent from a year ago.
Two weeks after the Feb. 14 shooting massacre in Parkland, Florida, CEO Stack announced that Dick's was halting sales of assault-style rifles and was ending sales of any gun to anyone under 21 years old.
The company said Tuesday it expects the decision to negatively impact 2018 sales to an extent, as there has been some pushback since, and shoppers who disagree with the ban vowing to make purchases elsewhere.