PetSmart net income grows in Q1; same-store sales miss
Phoenix – PetSmart Inc. posted a 1.3% increase in net income during the first quarter of fiscal 2014, rising to $104 million from $102 million in the first quarter of the prior year. Net sales increased 1.1% to $1.7 billion, but same-store sales missed Wall Street expectations by falling 0.6%.
PetSmart cited a challenging and volatile consumer environment and a competitive market as contributing to its weaker-than-anticipated same-store sales results.
Looking ahead, the company anticipates same-store sales for the full year to remain relatively flat, net sales growth in the low-single digits and earnings per share to range between $4.29 and $4.39. For the second quarter, the company anticipates comparable-store sales growth to remain flat or decrease slightly and earnings per share of $0.92 to $0.96.
“We are pleased with the company’s ability to achieve earnings per share growth of 6.1% while continuing to drive earnings before tax margin expansion during the first quarter,” said PetSmart president and CEO David Lenhardt. “However, we did not achieve our sales goals, which were impacted by a challenging and volatile consumer environment and a competitive market.”
Dick’s Sporting Goods targets female customers
Pittsburgh – Dick’s Sporting Goods Inc. is going to increase its focus on female customers. In a conference call with analysts discussing the company’s first quarter financial results, CEO Ed Stack said that the women’s segment has the most growth potential of any segment Dick’s targets.
The increased focus will include an expanded product selection for women, as well as female-oriented specialty stores located within larger Dick’s stores. Dick’s will make the wider women’s assortment available online as well as in stores.
After disappointing Q1, American Eagle to close 150 stores
Following disappointing results during the first quarter of fiscal 2014, which were consistent with the company’s expectations, American Eagle Outfitters has decided to close 150 stores in North America during the next three years, including nearly 100 AE stores.
For 2014, the company plans on closing approximately 50 AE and 20 aerie stores in North America. The store closings will translate to annualized after-tax savings of between $10 and $15 million beginning in 2015.
Net income dropped 86% to $3.87 million from $27.98 million, and total net revenue fell 5% to $646.13 million from $679.48 million. Same-store sales fell 10%. A significant decline in pretax income drove the company’s net income drop.
“Results were consistent with our expectations,” said interim CEO Jay Schottenstein. “The quarter reflected weak sales and increased markdowns. We are committed to improved profitability and are working hard to implement our plan to strengthen our brands, channels and operations. Specific actions underway include continuing to build strong omnichannel capabilities, rationalizing our store fleet, reducing expenses, growing international licensed stores, and most importantly, delivering great merchandise and customer experience across our brands. Our focus is on leveraging our strong brands and talented team in order to deliver long-term profitable growth and enhanced value for our shareholders.”