Dick's Sporting Goods on Tuesday announced its current president, Lauren Hobart, will succeed Ed Stack as chief executive on Feb. 1.
Stack, 65, will transition to executive chairman and remain chief merchant, the company said. He took over the business from his dad, Dick Stack, in 1984, at age 29. He took the company public in 2002.
"This is the perfect time for this transition," the outgoing CEO said in a statement. "We have the best management team in the company's history, and the investments we have made in our people, our stores, and our communities are paying off."
The announcement comes as Dick's Sporting Goods continues to reap the benefits of consumers buying more workout gear, sporting goods and outdoor equipment during the coronavirus pandemic. Its e-commerce sales surged 95% during the third quarter, and it reported record quarterly same-store sales growth of more than 23%. The company also cited strength in the golf category.
Its shares were up 1.5% in premarket trading.
Here's how Dick's Sporting Goods did during its fiscal third quarter of 2020, compared with what analysts were expecting, based on Refinitiv data:
For the quarter ended Oct. 31, Dick's Sporting Goods' net income grew to $177.2 million, or $1.84 a share, from $57.6 million, or 66 cents per share, a year earlier. Excluding one-time charges, the company earned $2.01 per share, better than the $1.01 expected by analysts.
Net sales climbed roughly 23% to $2.41 billion from $1.96 billion a year earlier, better than the $2.23 billion forecast by analysts.
The company said it is not offering an outlook for the remainder of the year due to the uncertainty stemming from the pandemic.
However, the company noted that, so far, "the favorable trends in our business have continued" into the fourth quarter. Through the first three weeks of the holiday quarter, it said same-store sales are up a high-teens percentage.
Like other retailers, the company has seen its costs boosted by the pandemic. In the latest period, it incurred $48 million in costs for safety measures and additional employee compensation.
The focus for Dick's Sporting Goods during the pandemic has been on driving sales online and encouraging shoppers to use its in-store pickup option for e-commerce purchases. During the third quarter, the company said its online sales accounted for about 21% of total net sales, up from 13% a year earlier.
Retailers are also getting better at using their stores and stock rooms to help fulfill online orders. Dick's said its stores fulfilled about 70% of its digital purchases during the quarter.
These efforts and investments should continue as the 52-year-oldf Hobart takes the reins in early 2021.
Following stints at PepsiCo, Wells Fargo and JPMorgan, Hobart joined Dick's in February 2011 as senior vice president and chief marketing officer, where she played a key role in helping develop and launch one of the retailer's top private labels, CALIA by Carrie Underwood. In 2015, she was promoted to executive vice president and CMO, and then chief customer and digital officer. She was named president in May 2017, and has served on the board since January 2018.
Hobart also earlier this year joined the board of Yum Brands.
Hobart has made the women's athletic apparel and footwear market a bigger focus at Dick's Sporting Goods, helping to drive the launch of additional private labels. She has helped Dick's refocus its strategy to compete against Amazon and Walmart, as a number of its sporting goods rivals — such as Sports Authority, Sport Chalet and City Sports — have filed for bankruptcy and shuttered stores in recent years.
She has helped the company refocus its inventories on key categories like youth sports, improve customer service and add in-store experiences like batting cages, to offer shoppers something they cannot find on the internet.
As of Monday's market close, Dick's Sporting Goods shares are up more than 18% this year, giving the company a market cap of about $5.2 billion.