Sportsman's Q1'FY15 net sales fall 3% to $132.4mn

05 Jul '14

4 min read

Mr. Schaefer added, "Our unique and differentiated position in the large, growing and fragmented outdoor sporting goods market continues to drive our success. We offer "easy-in, easy-out", no-frills stores that cater to local communities and offer a broad selection of locally relevant, predominantly branded merchandise, at everyday low prices, delivered by passionate and knowledgeable associates. Our flexible store format allows us to profitably service both smaller Metropolitan Statistical Areas ("MSAs") as well as larger ones, resulting in a 300+ store opportunity for our concept.

“Our new stores generate attractive returns across a variety of markets, with an average payback period on our investment of two and a half years. In addition to the exciting new store growth opportunity that lies ahead, particularly in small MSAs that are not as attractive to other national industry players, we also have our clothing and footwear expansion initiative that is underway. Our store-within-a-store clothing program which has been implemented in 28 stores as of the end of the first quarter has gained traction and is generating a healthy lift in category performance. We plan to roll this initiative out to seven additional stores by early 2015."

Mr. Schaefer concluded: "Our unique position in this attractive and growing industry and our flexible store format support the long runway of growth we see ahead. In combination with our company specific initiatives to drive sales and margins, and our plans to pay down debt over time, our long-term goals are to generate mid-teens EBITDA growth and 25% net income growth."

Balance sheet highlights as of May 3, 2014:

The Company's IPO closed on April 23, 2014. Net proceeds from the IPO of $70.3 million, which were used to repay amounts outstanding under the Company's term loans, are reflected in the Company's financial statements for the quarter ended May 3, 2014. Net proceeds of $3.0 million from the underwriter's partial exercise of the over-allotment option are not reflected in the first quarter financial statements as this exercise took place during the Company's fiscal second quarter.

Cash: $1.8 million Total debt: $210.3 million, consisting of $50.0 million outstanding under the revolving credit facility and $160.4 million outstanding under the term loans, net of unamortized discount. Total liquidity (cash plus $37.4 million of availability on a $105.0 million revolving credit facility): $39.2 million.

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