- Q4 Diluted EPS of $2.55 & Full Year Diluted EPS of
$8.17, in Line With Recent Guidance
- Q4 Comparable Sales Decrease 6.4% Versus a 15.5% Increase in
the Prior Year Period
- Fiscal 2024 Full Year Net Sales Growth of 1.2%
- Issues Fiscal 2025 Outlook
Hibbett, Inc. (Nasdaq/GS: HIBB), an athletic-inspired fashion
retailer, provided financial results for its fourth quarter and
full year ended February 3, 2024, (“Fiscal 2024”) and business
updates.
Mike Longo, President and Chief Executive Officer, stated, “We
are pleased to report a solid financial performance for the fourth
quarter of Fiscal 2024, as we continued to execute our strategy in
a dynamic and challenging retail environment. Notably, we finished
the year with $1.73 billion in sales, a new full fiscal year record
for Hibbett. Our sales performance for the fourth quarter reflects
the busy holiday selling season, which was in line with our
expectations. During the quarter, we also benefited from new
product launches and a favorable customer response for our popular
footwear brands. The fourth quarter also benefited from our
integrated Hibbett Rewards X Nike Membership, which brings together
the Hibbett and Nike loyalty programs and supports sales growth
across all retail channels. This loyalty partnership will provide
exclusive shopping experiences, personalized content, and early
access to the latest product launches for our Connected
members.”
Mr. Longo continued, “We are proud of our performance over the
past year, demonstrating our team’s ability to consistently execute
our strategy and deliver positive financial results. As we look
ahead to Fiscal 2025, we will continue to leverage our proven
business model to meet customer demand and drive additional market
share. We will look for opportunities to enhance our product mix in
line with current consumer spending patterns and ensure we have the
right inventory mix across our sales channels.”
Mr. Longo concluded, “As we continue to extend our market reach,
we believe Hibbett is building momentum, and our sales guidance for
the year ahead reflects this confidence. In Fiscal 2025, we plan to
continue to make significant investments in our store footprint,
customer-facing technologies, and back-office infrastructure. This
will impact our profitability growth in the short term but will
enhance our value proposition and profitability over the longer
term. We remain focused on providing a unique and compelling
product assortment supported by our omni-channel platform
capabilities and exceptional customer service that allows us to
serve our customers wherever and whenever they decide to shop. We
look forward to opportunities to continue expanding our Hibbett and
City Gear brands while delivering greater value to our customers
and shareholders.”
Fourth Quarter Results
The fourth quarter and Fiscal 2024 ended on February 3, 2024.
The fourth quarter included 14 weeks of results and Fiscal 2024
included 53 weeks of results.
Net sales for the 14-weeks ended February 3, 2024, increased
1.8% to $466.6 million compared with $458.3 million for the
13-weeks ended January 28, 2023. Comparable sales declined 6.4%
versus the equivalent 13-weeks in the prior year. Brick and mortar
comparable sales declined 9.2%, while e-commerce increased 6.9% on
a year-over-year basis, excluding the impact of the 53rd week.
E-commerce represented 18.9% of total net sales for the 14-weeks
ended February 3, 2024, compared to 17.4% in the 13-weeks ended
January 28, 2023.
Gross margin was 34.5% of net sales for the 14-weeks ended
February 3, 2024, compared with 35.2% of net sales for the 13-weeks
ended January 28, 2023. The approximate 70 basis point decline was
primarily due to lower average product margin of approximately 125
basis points and an approximate 55 basis-point increase in store
occupancy costs. Freight, shipping, logistics costs and shrink have
improved as a percent of sales on a year-over-year basis, partially
offsetting the unfavorable average product margin and store
occupancy performance. Freight was favorable by approximately 65
basis points, logistics was favorable by approximately 30 basis
points and shrink was favorable by approximately 15 basis
points.
Store operating, selling and administrative (“SG&A”)
expenses were 23.0% of net sales for the 14-weeks ended February 3,
2024, compared with 21.6% of net sales for the 13-weeks ended
January 28, 2023. The increase of approximately 140 basis points is
primarily the result of the inflationary impact on store wages and
the related benefit costs, a growing store base and increased data
processing costs associated with the ongoing investment in
cloud-based back-office systems and technology.
Net income for the 14-weeks ended February 3, 2024, was $30.9
million, or $2.55 per diluted share, compared to $38.4 million, or
$2.91 per diluted share for the 13-weeks ended January 28,
2023.
During the fourth quarter, we opened 14 new stores and closed 3
stores, bringing the store base to 1,169 in 36 states as of
February 3, 2024.
We ended the fourth quarter of Fiscal 2024 with $21.2 million of
available cash and cash equivalents on our unaudited condensed
consolidated balance sheet and $45.3 million of debt outstanding.
Inventory as of February 3, 2024, was $344.3 million, an 18.2%
decrease compared to the prior year fourth quarter.
During the 14-weeks ended February 3, 2024, the Company paid a
quarterly dividend equal to $0.25 per outstanding common share that
resulted in a cash outlay of $2.9 million. Capital expenditures
during the 14-weeks ended February 3, 2024, were $20.7 million
compared to $15.4 million in the 13-weeks ended January 28,
2023.
Fiscal 2024 Year Results
Net sales for the 53-weeks ended February 3, 2024, increased
1.2% to $1.73 billion compared with $1.71 billion for the 52-weeks
ended January 28, 2023. Comparable sales decreased 3.1% versus the
equivalent 52-weeks in the prior year. Brick and mortar comparable
sales declined 4.4% and e-commerce sales increased 4.1%, excluding
the impact of the 53rd week. E-commerce represented 16.2% of total
net sales in the 53-weeks ended February 3, 2024, compared to 15.6%
in the 52-weeks ended January 28, 2023.
Gross margin was 33.8% of net sales for the 53-weeks ended
February 3, 2024, compared with 35.2% of net sales for the 52-weeks
ended January 28, 2023. The approximate 140 basis point decline was
primarily due to lower average product margin of approximately 210
basis points and an approximate 40 basis point increase in store
occupancy costs. Freight, shipping, logistics costs and shrink have
improved as a percentage of sales on a year-over-year basis,
partially offsetting the unfavorable average product margin and
store occupancy performance. Freight was favorable by approximately
70 basis points, logistics was favorable by approximately 30 basis
points and shrink was favorable by approximately 10 basis
points.
SG&A expenses were 23.0% of net sales for the 53-weeks ended
February 3, 2024, compared with 22.8% of net sales for the 52-weeks
ended January 28, 2023. The approximate 20 basis point increase is
primarily the result of increased store wages and data processing
costs partially offset by lower professional fees and
advertising.
Net income for the 53-weeks ended February 3, 2024, was $103.2
million, or $8.17 per diluted share, compared to $128.1 million, or
$9.62 per diluted share for the 52-weeks ended January 28,
2023.
During the 53-weeks ended February 3, 2024, the Company
repurchased 1.2 million shares of common stock for a total
expenditure of $56.1 million, including 47,550 shares acquired from
employee holders of RSUs to satisfy tax withholding requirements of
$2.8 million. The Company also paid recurring quarterly dividends
that resulted in a cash outlay of $12.4 million.
Capital expenditures during the 53-weeks ended February 3, 2024,
were $57.9 million compared to $62.8 million in the 52-weeks ended
January 28, 2023. Current year capital expenditures were
predominantly related to store initiatives including new store
openings, relocations, expansions, remodels and capital associated
with general maintenance of our facilities.
53rd Week and Fourth Quarter Change in
Accounting Estimate
Total net product sales for the 53rd week of Fiscal 2024 were
approximately $22.9 million. The extra week increased fourth
quarter and full year net income by an estimated $2.6 to $2.8
million. This translates to an approximate diluted EPS range of
$0.21 to $0.23 for the fourth quarter and $0.21 to $0.22 for the
full year. In addition, during the 14-weeks ended February 3, 2024,
we recorded a $3.5 million increase in revenue due to a change in
estimate in gift card breakage. This change was supported by the
historical redemption pattern of gift cards outstanding and
contributed $0.23 and $0.22 of diluted EPS to the fourth quarter
and full year, respectively.
Full Year Fiscal 2025
Outlook
Please note that the fiscal year ending February 1, 2025
(“Fiscal 2025”), will have 52 weeks versus 53 weeks in Fiscal 2024.
A number of business and economic challenges we faced in Fiscal
2024 will continue to impact our business in Fiscal 2025. These
challenges include the potential for inflation and interest rates
to remain elevated, the continued use of promotional activity to
drive traffic, ongoing wage pressures, a more cautious and
selective consumer, and ongoing geopolitical conflicts. These
factors contribute to the complexity and volatility in forecasting
Fiscal 2025 results.
Considering the factors noted above, we are providing an
overview of our estimated results for Fiscal 2025. Additional
commentary and insight will be provided at our upcoming fourth
quarter and full year investor call.
Metric
Guidance
Comment
Total sales
Flat to up ~2.0%
Versus 53-week Fiscal 2024 results
Comp sales
Flat to negative low-single digit
Versus weeks 2-53 in Fiscal 2024
Brick and mortar comp
Flat to negative low-single digit
Versus weeks 2-53 in Fiscal 2024
E-commerce comp
Up mid to high-single digit
Versus weeks 2-53 in Fiscal 2024
Net store growth in units
~ 45 to 50
~ 80% Hibbett; ~20% City Gear
Gross margin %
34.2% to 34.5%
Less promotional
SG&A %
23.9% to 24.2%
Store growth, infrastructure
investments
Operating profit %
7.0% to 7.4%
SG&A deleverage; some margin
offset
Interest expense %
0.10% to 0.20%
Inventory levels and interest rates
stable
Diluted EPS
$8.00 to $8.75
Diluted shares
~11.6 to 11.7 million
Tax rate
22.9% to 23.2%
Capital expenditures
~ $65 to $75 million
Focus on store development initiatives
Sales Guidance
- Total net sales in Fiscal 2025 are anticipated to be flat to up
approximately 2.0% compared to our full year Fiscal 2024
results.
- Due to the transition from a 53-week year in Fiscal 2024 to a
52-week year in Fiscal 2025, comparable sales for Fiscal 2025 will
be compared to weeks two through 53 in Fiscal 2024. Comparable
sales are expected to be flat to down in the low-single digit range
for the year. Brick and mortar comparable sales are expected to
range from flat to negative low-single digits. Both total
e-commerce revenue and comparable e-commerce revenue is anticipated
to be up in the mid to high-single digit range.
- Net new store growth is expected to be approximately 45 to 50
units. The first quarter is projected to have the lowest growth
with net new units anticipated to be more evenly distributed across
the remaining three quarters.
Additional Guidance
Commentary
- Gross margin expectations include a less impactful promotional
environment and small leverage gains in freight and logistics
partially offset by headwinds in store occupancy. These factors are
expected to drive approximately 40 to 70 basis points of
improvement in the gross profit percentage in comparison to Fiscal
2024 results. Expected full year gross margin is anticipated to be
in the range of 34.2% to 34.5% of net sales.
- SG&A as a percent of net sales is expected to increase by
approximately 90 to 120 basis points in comparison to Fiscal 2024
results due to new store growth, wage inflation and increased
incentive compensation, transaction fees and data processing costs
including incremental investment in cloud-based technology
solutions. The expected full year SG&A expense range is
estimated to be 23.9% to 24.2% of net sales.
- Operating profit is expected to be in the range of 7.0% to 7.4%
of net sales, a decline of approximately 50 to 90 basis points in
comparison to Fiscal 2024 results.
- It is anticipated there will be debt outstanding under our line
of credit for a majority of the year. We believe peak borrowings
will be tied closely to the timing of receipts leading up to our
peak selling seasons. Interest expense for the full year is
projected to be approximately 10 to 20 basis points of net
sales.
- Diluted earnings per share are anticipated to be in the range
of $8.00 to $8.75 using an estimated full year tax rate of between
22.9% and 23.2% and an estimated weighted average diluted share
count of approximately 11.6 to 11.7 million.
- Capital expenditures are anticipated to be in the range of $65
to $75 million with the largest share of this investment focused on
new store growth, remodels, relocations, new store signage and
improving the consumer experience.
- Our capital allocation strategy continues to include share
repurchases and recurring quarterly dividends in addition to the
capital expenditures noted above.
Investor Conference Call and
Simulcast
Hibbett, Inc. will host a webcast at 9:00 a.m. ET on Friday,
March 15, 2024, to discuss the Company’s fourth quarter and full
year results. The webcast of Hibbett’s earnings review and a slide
deck of supporting information that will be referenced during the
webcast will be available at https://investors.hibbett.com/ under
the News & Events section. A replay of the webcast will be
available for 30 days.
About Hibbett, Inc.
Hibbett, headquartered in Birmingham, Alabama, is a leading
athletic-inspired fashion retailer with 1,169 Hibbett, City Gear
and Sports Additions specialty stores located in 36 states
nationwide as of February 3, 2024. Hibbett has a rich history of
convenient locations, personalized customer service and access to
coveted footwear, apparel and equipment from top brands like Nike,
Jordan, New Balance and adidas. Consumers can browse styles, find
new releases, shop looks and make purchases online or in their
nearest store by visiting www.hibbett.com. Follow us @hibbettsports
and @citygear on Facebook, Instagram and Twitter.
Disclosure Regarding Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the federal securities laws. Other than statements
of historical facts, all statements which address activities,
events, or developments that the Company anticipates will or may
occur in the future, including, but not limited to, such things as
Fiscal 2025 outlook, future capital expenditures, expansion,
strategic plans, financial objectives, dividend payments, stock
repurchases, growth of the Company’s business and operations,
including future cash flows, revenues, and earnings, our effective
tax rate and other such matters, are forward-looking statements.
The forward-looking statements contained in this press release
reflect our current views about future events and are subject to
risks, uncertainties, assumptions, and changes in circumstances
that may cause events or our actual activities or results to differ
significantly from those expressed in any forward-looking
statement. Although we believe that the expectations reflected in
the forward-looking statements are reasonable, we cannot guarantee
future events, results, actions, levels of activity, or performance
or achievements. Readers are cautioned not to place undue reliance
on these forward-looking statements. A number of important factors
could cause actual results to differ materially from those
indicated by the forward-looking statements, including, but not
limited to: changes in general economic or market conditions that
could affect overall consumer spending or our industry; changes to
the financial health of our customers; our ability to successfully
execute our long-term strategies; our ability to effectively drive
operational efficiency in our business; the potential impact of new
trade, tariff and tax regulations on our profitability; our ability
to effectively develop and launch new, innovative and updated
products; our ability to accurately forecast consumer demand for
our products and manage our inventory in response to changing
demands; increased competition causing us to lose market share or
reduce the prices of our products or to increase significantly our
marketing efforts; the impact of public health crises or other
significant or catastrophic events such as extreme weather, natural
disasters or climate change; fluctuations in the costs of our
products; acceleration of costs associated with the protection of
the health of our employees and customers; loss of key suppliers or
manufacturers or failure of our suppliers or manufacturers to
produce or deliver our products in a timely or cost-effective
manner, including due to port disruptions; our ability to
accurately anticipate and respond to seasonal or quarterly
fluctuations in our operating results; our ability to successfully
manage or realize expected results from an acquisition, and other
significant investments or capital expenditures; the availability,
integration and effective operation of information systems and
other technology, as well as any potential interruption of such
systems or technology; risks related to data security or privacy
breaches; our ability to raise additional capital required to grow
our business on terms acceptable to us; our potential exposure to
litigation and other proceedings; and our ability to attract key
talent and retain the services of our senior management and key
employees.
These forward-looking statements are based largely on our
expectations and judgments and are subject to a number of risks and
uncertainties, many of which are unforeseeable and beyond our
control. For additional discussion on risks and uncertainties that
may affect forward-looking statements, see “Risk Factors” disclosed
in our most recent Annual Report on Form 10-K and other reports the
Company files with the Securities and Exchange Commission. Any
changes in such assumptions or factors could produce significantly
different results. The Company undertakes no obligation to update
forward-looking statements, whether as a result of new information,
future events, or otherwise.
HIBBETT, INC. AND
SUBSIDIARIES
Unaudited Condensed
Consolidated Statements of Operations
(Dollars in thousands, except
per share amounts)
February 3, 2024 (14
Weeks)
January 28, 2023 (13
Weeks)
February 3, 2024
(53-Weeks)
January 28, 2023
(52-Weeks)
% to Sales
% to Sales
% to Sales
% to Sales
Net sales
$
466,589
$
458,295
$
1,728,887
$
1,708,316
Cost of goods sold
305,773
65.5
%
297,109
64.8
%
1,145,184
66.2
%
1,106,415
64.8
%
Gross margin
160,816
34.5
%
161,186
35.2
%
583,703
33.8
%
601,901
35.2
%
SG&A expenses
107,390
23.0
%
99,042
21.6
%
397,674
23.0
%
389,563
22.8
%
Depreciation and amortization
12,819
2.7
%
11,457
2.5
%
49,008
2.8
%
43,919
2.6
%
Operating income
40,607
8.7
%
50,687
11.1
%
137,021
7.9
%
168,419
9.9
%
Interest expense, net
1,048
0.2
%
555
0.1
%
5,372
0.3
%
1,455
0.1
%
Income before provision for income
taxes
39,559
8.5
%
50,132
10.9
%
131,649
7.6
%
166,964
9.8
%
Provision for income taxes
8,675
1.9
%
11,708
2.6
%
28,491
1.6
%
38,907
2.3
%
Net income
$
30,884
6.6
%
$
38,424
8.4
%
$
103,158
6.0
%
$
128,057
7.5
%
Basic earnings per share
$
2.61
$
3.00
$
8.34
$
9.89
Diluted earnings per share
$
2.55
$
2.91
$
8.17
$
9.62
Weighted average shares outstanding:
Basic
11,834
12,790
12,364
12,951
Diluted
12,117
13,186
12,633
13,315
Percentages may not foot due to
rounding.
HIBBETT, INC. AND
SUBSIDIARIES
Unaudited Condensed
Consolidated Balance Sheets
(Dollars in thousands)
February 3, 2024
January 28, 2023
Assets
Cash and cash equivalents
$
21,230
$
16,015
Inventories, net
344,294
420,839
Other current assets
41,191
36,201
Total current assets
406,715
473,055
Property and equipment, net
183,949
169,476
Operating right-of-use assets
280,755
263,391
Finance right-of-use assets
1,837
2,279
Tradename intangible asset
23,500
23,500
Deferred income taxes, net
3,024
3,025
Other assets, net
9,442
4,434
Total assets
$
909,222
$
939,160
Liabilities and Stockholders’
Investment
Accounts payable
$
96,431
$
190,648
Credit facility
45,296
36,264
Operating lease obligations
71,448
72,544
Finance lease obligations
538
1,132
Other accrued expenses
22,501
27,164
Total current liabilities
236,214
327,752
Long-term operating lease obligations
245,649
229,388
Long-term finance lease obligations
1,423
1,305
Other noncurrent liabilities
6,911
4,484
Stockholders’ investment
419,025
376,231
Total liabilities and stockholders’
investment
$
909,222
$
939,160
HIBBETT, INC. AND
SUBSIDIARIES
Supplemental
Information
(Unaudited)
February 3, 2024 (14
Weeks)
January 28, 2023 (13
Weeks)
February 3, 2024
(53-Weeks)
January 28, 2023
(52-Weeks)
Sales
Information
Net sales increase
1.8
%
19.6
%
1.2
%
1.0
%
Comparable sales (decrease) increase
(6.4
)%
15.5
%
(3.1
)%
(2.2
)%
Store Count
Information
Beginning of period
1,158
1,126
1,133
1,096
New stores opened
14
9
44
43
Stores closed
(3
)
(2
)
(8
)
(6
)
End of period
1,169
1,133
1,169
1,133
Estimated square footage at end of period
(in thousands)
6,640
6,424
Balance Sheet
Information
Average inventory per store (in
thousands)
$
295
$
371
Share Repurchase
Information
Shares purchased under our stock
repurchase program
—
—
1,162,130
797,033
Cost (in thousands)
$
—
$
—
$
53,211
$
38,458
Settlement of net share equity awards
—
5,357
47,550
51,558
Cost (in thousands)
$
—
$
365
$
2,849
$
2,446
Dividend
Information
Number of declarations
1
1
4
4
Cash paid (in thousands)
$
2,943
$
3,182
$
12,370
$
12,881
Total paid per share
$
0.25
$
0.25
$
1.00
$
1.00
HIBBETT, INC. AND
SUBSIDIARIES
Fiscal 2024 Comparable Store
Sales and Net Sales
As Originally Reported and
Adjusted for Week Shift(1)
(unaudited)
Fiscal 2024
First Quarter
Second Quarter
Third Quarter
Fourth Quarter
Fiscal 2024
Comparable store sales increase (decrease)
- originally reported
4.1
%
(7.3
)%
(2.7
)%
(6.4
)%
(3.1
)%
Comparable store sales increase (decrease)
- adjusted for week shift
5.2
%
(0.8
)%
(8.4
)%
(8.1
)%
(3.2
)%
Impact of week shift
1.1
%
6.5
%
(5.7
)%
(1.7
)%
(0.1
)%
Fiscal 2024
(Dollars in millions)
First Quarter
Second Quarter
Third Quarter
Fourth Quarter
Fiscal 2024
Net sales - originally reported
$
455.5
$
374.9
$
431.9
$
466.6
$
1,728.9
Net sales - adjusted for week shift
$
460.7
$
401.3
$
406.7
$
437.4
$
1,706.1
Impact of week shift
$
5.2
$
26.4
$
(25.2
)
$
(29.2
)
$
(22.8
)
(1) Due to the 53rd week in Fiscal 2024,
each quarter in Fiscal 2025 starts one week later than the same
quarter in Fiscal 2024. The charts above present comparable store
sales and net sales for Fiscal 2024 as originally reported and as
adjusted to represent the same 13-week period as the Fiscal 2025
quarters.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240315971070/en/
Robert Volke - SVP, Chief Financial Officer Gavin Bell - VP,
Finance & Investor Relations (205) 944-1312
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