Big 5 Sporting posts Q2 results
Big 5 Sporting Goods Corporation, a leading sporting goods retailer, reported financial results for the fiscal 2010 third quarter ended October 3, 2010.
For the fiscal 2010 third quarter, net sales increased to $231.8 million from net sales of $231.6 million for the third quarter of fiscal 2009. Same store sales increased 2.0% for the third quarter versus the comparable period last year. The net sales comparison to the prior year was negatively impacted by a calendar shift as the Company transitioned to a 52-week fiscal year in 2010 from a 53-week fiscal year in 2009.
As a result, a high volume sales week, which included the Fourth of July holiday, shifted out of the third fiscal quarter into the second quarter and a lower volume sales week at the beginning of October shifted into the third fiscal quarter of 2010. The effect of the calendar shift is not reflected in the Company's third quarter same store sales comparison to the prior year because the Company reports same store sales on a comparable calendar day basis as opposed to a fiscal period basis.
Gross profit for the fiscal 2010 third quarter was $77.4 million, compared to $78.5 million in the third quarter of the prior year. The Company's gross profit margin was 33.4% in the fiscal 2010 third quarter versus 33.9% in the third quarter of the prior year. The decrease in gross profit margin was driven primarily by a decrease in merchandise margins of approximately 50 basis points reflecting a shift in the Company's product sales mix, as well as higher store occupancy costs reflecting the expense for new store openings.
Selling and administrative expense as a percentage of net sales was 28.6% in the fiscal 2010 third quarter versus 28.2% in the third quarter of the prior year. Overall selling and administrative expense increased $1.0 million for the quarter from the same period last year due primarily to higher store-related expenses as a result of new store openings.
Net income for the third quarter of fiscal 2010 was $6.8 million, or $0.31 per diluted share, versus net income of $8.0 million, or $0.37 per diluted share, for the third quarter of fiscal 2009.
For the 39-week period ended October 3, 2010, net sales increased to $670.1 million from net sales of $657.9 million for the 39-week period last year. Same store sales increased 1.3% in the first 39 weeks of fiscal 2010 versus the comparable period last year. Net income was $16.6 million, or $0.76 per diluted share, for the first 39 weeks of fiscal 2010, up from net income of $15.4 million, or $0.72 per diluted share, for the same period last year.
"The third quarter represented another solid financial performance for Big 5 Sporting Goods," said Steven G. Miller, the Company's Chairman, President and Chief Executive Officer. "We produced positive same store sales over each month of the period, as we benefitted from increased customer traffic. These positive metrics were on top of the positive comps and increased traffic we reported for the same period last year. As anticipated, our sales and bottom line fiscal comparisons to the prior year were significantly impacted by the calendar shift that moved a high volume sales week out of the third quarter and a lower volume sales week into the third quarter."
Mr. Miller continued, "We are pleased with the consistency of our business as sales have continued to trend positively into the fourth quarter. While the important holiday selling season lies ahead and the economy and consumer spending habits remain unpredictable, we believe that our ability to provide exceptional value on quality merchandise will position us well as we conclude the year."
Big 5 Sporting Goods Corporation