Home Fashion Industry Financial Sportsman’s Warehouse Holdings, Inc. Announces Strong First

Sportsman’s Warehouse Holdings, Inc. Announces Strong First

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WEST JORDAN, Utah, May 31, 2022 (GLOBE NEWSWIRE) Sportsman’s Warehouse Holdings, Inc. (“Sportsman’s Warehouse” or the “Company”) (Nasdaq: SPWH) today announced its financial results for the thirteen weeks ended April 30 2022.

“Our first quarter results were highlighted by strong performances in our hunting and shooting sports, apparel and footwear categories,” said Jon Barker, general manager of Sportsman’s Warehouse. “Ammunition inventory levels continue to improve, driving traffic both online and in our stores. We added three new stores to our fleet during the quarter and last week we celebrated the grand opening of our new Spike Camp store in Riverton, Wyoming. This now brings the total number of stores in our fleet to 126 across the United States.”

Mr. Barker continued, “We continue to closely monitor the impact of the current macro-economic environment on consumer behavior. Our wide assortment in several product categories allows us to meet the changing needs of the consumer. With our value-for-money leadership position in our industry and our growing omnichannel presence, we remain confident in our ability to serve the customer looking for the brands and gear needed to enjoy the outdoors.

For the thirteen weeks ended April 30, 2022:

  • Net sales were $309.5 million, a decrease of 5.3%, compared to $327.0 million in the first quarter of Fiscal 2021. The decrease in net sales was mainly due to lower sales demand across all product categories as we celebrated the anniversary of increased demand in the first quarter of fiscal 2021. quarter of 2021 impacted by the COVID economic stimulus package -19 (the US bailout) and social unrest. This increase was partially offset by the addition of 13 new stores since May 1, 2021, which contributed $20.0 million in revenue in the current quarter.

  • Same-store sales decreased 11.6% in the first quarter of 2022, compared to the first quarter of 2021. This was primarily due to lower demand across all product categories due to comparison difficult from year to year described above.

  • Gross profit was $99.1 million or 32.0% of net sales, compared to $104.0 million or 31.8% of net sales in the comparable period last year. The 20 basis point improvement in net sales percentage can be attributed to a favorable product sales mix and higher product margins, partially offset by higher overall transportation costs.

  • Selling, general and administrative (SG&A) expenses increased to $96.1 million, an increase of 6.3%, compared to $90.4 million in the first quarter of fiscal 2021. This increase is the result of a return to pre-pandemic levels of marketing and travel activities, the timing of new store openings, and increased depreciation expense, payroll and rent.

  • Net income was $2.0 million, compared to net income of $10.5 million in the first quarter of 2021. Adjusted net income was $2.2 million, compared to adjusted net income of $12.5 million in the first quarter of 2021 (see “GAAP and Non-GAAP Measures”). ).

  • Adjusted EBITDA was $12.9 million, compared to $23.5 million for the comparable period last year (see “GAAP and Non-GAAP Measures”).

  • Diluted earnings per share were $0.05, compared to diluted earnings per share of $0.23 in the comparable period last year. Adjusted diluted earnings per share was $0.05, compared to adjusted diluted earnings per share of $0.28 for the comparable period last year (see “GAAP and Non-GAAP Measures”).

Highlights of the balance sheet as of April 30, 2022:

  • The company ended the first quarter with net debt of $40.8 million, consisting of $98.5 million in outstanding borrowings under the company’s revolving credit facility and $57.7 million in cash dollars.

  • Total cash was $168.2 million at the end of the first quarter, consisting of $110.5 million of availability on the revolving credit facility, which does not give effect to the amended credit agreement entered into after the end of the first quarter, and $57.7 million in cash.

Modified and updated credit agreement:

On May 27, 2022, the Company and the Company’s subsidiaries, each as borrowers or guarantors, amended and restated the credit agreement governing the revolving credit facility with a syndicate of banks led by Wells Fargo (the “Amended Credit Agreement”). The Amended Credit Agreement, among other things, increased the maximum borrowing capacity under the Revolving Credit Facility from $250.0 million to $350.0 million, subject to a calculation of the basis of borrowing, extended the maturity date from May 23, 2023 to May 27, 2027 and replaced LIBOR with Term SOFR as the benchmark interest rate and made certain related compliance changes.

“The increased capacity of our revolving credit facility reflects the growth and health of our business and gives us additional flexibility to execute on our growth initiatives,” said Jeff White, CFO of Sportsman’s Warehouse. “We appreciate the continued support of our lending partners as we further grow our business and grow our in-store presence.”

Outlook for the second quarter of 2022:

For the second quarter of fiscal 2022, net sales are expected to be between $330 million and $350 million, anticipating same-store sales to decline 16% to 10% year-over-year. Adjusted diluted earnings per share for the quarter are expected to be between $0.22 and $0.30.

About Sportsman’s Warehouse Holdings, Inc.

Sportsman’s Warehouse Holdings, Inc. is an outdoor specialty retailer focused on meeting the needs of the seasoned outdoor veteran, first timer and everyone in between. We provide exceptional equipment and exceptional service to inspire memories in the great outdoors.

SPORTS WAREHOUSES, INC.
Condensed Consolidated Statements of Income (unaudited)
(in thousands, except per share data)
For the thirteen weeks ended
April 30, 2022 % of net sales May 1, 2021 % of net sales Annual gap

Net sales

$

309 505

100.0 %

$

326,992

100.0 %

($

17,487

)

Cost of Goods Sold

210 414

68.0 %

222,945

68.2 %

(12,531

)

Gross profit

99,091

32.0 %

104,047

31.8 %

(4,956

)

Operating costs :

Selling, general and administrative expenses

96,085

31.0 %

90,419

27.7 %

5,666

Income from operations

3,006

1.0 %

13,628

4.1 %

(10,622

)

Interest expense

567

0.2 %

226

0.1 %

341

Profit before income tax expense

2,439

0.8 %

13,402

4.0 %

(10,963

)

income tax expense

441

0.1 %

2,952

0.9 %

(2,511

)

Net revenue

$

1,998

0.7 %

$

10,450

3.1 %

($

8,452

)

Earnings per share

Basic

$

0.05

$

0.24

($

0.19

)

Diluted

$

0.05

$

0.23

($

0.19

)

Weighted average number of shares outstanding

Basic

43,938

43,690

248

Diluted

44,221

44,514

(293

)

SPORTS WAREHOUSES, INC.
Condensed consolidated balance sheets (unaudited)
(in thousands)
April 30, 2022 January 29, 2022
Assets

Current assets:

Cash

$

57,705

$

57,018

Accounts receivable, net

1,254

1,937

Merchandise inventories

436 438

386,560

Prepaid and other expenses

20,878

21,955

Total current assets

516 275

467 470

Operating lease right-of-use asset

245,861

243,047

Property and equipment, net

133,871

128,304

Good will

1,496

1,496

Definite life intangible assets, net

252

264

Total assets

$

897 755

$

840 581

Liabilities and equity

Current liabilities:

Accounts payable

$

100,618

$

58,916

Increased expenses

93,038

109,012

Liabilities related to operating leases, in progress

41,697