Big 5 Sporting Goods Corporation Announces Fiscal 2020 Fourth Quarter and Full Year Results
March 02, 2021 at 16:01 PM EST
EL SEGUNDO, Calif., March 02, 2021 (GLOBE NEWSWIRE) -- Big 5 Sporting Goods Corporation (Nasdaq: BGFV) (the “Company,” “we,” “our,” “us,” “Big 5”), a leading sporting goods retailer, today reported financial results for the fiscal 2020 fourth quarter and full year ended January 3, 2021.
Steven G. Miller, the Company’s Chairman, President and Chief Executive Officer, said, “Our strong fourth quarter results highlight our exceptional performance in fiscal 2020 with record earnings driven by top line sales growth, merchandise margin expansion and an improved cost structure. As we faced the many challenges of 2020, we remained focused on providing our customers with a convenient shopping experience to find products to stay active and healthy. Our team did a tremendous job of recognizing and capitalizing on key product trends. Additionally, in 2020 we successfully implemented cost reduction initiatives that are continuing to provide significant operating leverage. Looking back on the year, I want to once again thank our entire team for their dedication and execution during a challenging period.”
Mr. Miller continued, “The momentum of 2020 has continued into the start of 2021, with our same store sales up approximately 20% for the quarter to date. Although team sports remain impacted by widespread suspension of league play, this softness has been more than offset by strength in other product categories. Winter-related product sales have been very strong, as customers have taken advantage of favorable winter weather to recreate outdoors. The exceptional performance of our business over the course of 2020 and into 2021 is reflected in our balance sheet, as we currently have no debt and a strong cash position. We are pleased to report that our Board of Directors has authorized an increase in our regular cash dividend from an annual rate of $0.40 per share to an annual rate of $0.60 per share.”
As previously reported, net sales for the 14-week fiscal 2020 fourth quarter were $290.6 million compared to net sales of $244.1 million for the 13-week fourth quarter of fiscal 2019. Same store sales increased 10.5% for the fourth quarter of fiscal 2020.
As a result of the Company’s fiscal calendar, the fourth quarter of fiscal 2020 included 14 weeks, the fourth quarter of the prior fiscal year included 13 weeks, the fiscal 2020 full year included 53 weeks and the prior fiscal full year included 52 weeks. The Company’s same store sales results for the fourth quarter reflect comparable 14-week periods and for the full year reflect comparable 53-week periods.
Gross profit for the 14-week fiscal 2020 fourth quarter increased 33.0% to $102.4 million, compared to $77.0 million in the 13-week fourth quarter of fiscal 2019. The Company’s gross profit margin was 35.2% in the fiscal 2020 fourth quarter versus 31.6% in the fourth quarter of the prior year. The increase in gross profit margin largely reflects a 243-basis point increase in merchandise margins, lower store occupancy and warehousing costs as a percentage of net sales and, to a lesser degree, the favorable impact from an insurance settlement, partially offset by lower distribution costs capitalized into inventory for the quarter.
Selling and administrative expense as a percentage of net sales was 25.6% in the fiscal 2020 fourth quarter versus 30.9% in the fiscal 2019 fourth quarter. Overall selling and administrative expense for the quarter decreased $1.1 million from the prior year primarily due to lower print advertising expense and the favorable impact of an insurance settlement, partially offset by higher performance-based incentive compensation accruals.
Net income for the fourth quarter of fiscal 2020 was $21.0 million, or $0.95 per diluted share, which includes a benefit of $0.10 per diluted share related to a favorable insurance settlement and a benefit of $0.02 per diluted share related to a reduction in deferred tax asset valuation allowance. Net income for the fourth quarter of fiscal 2019 was $0.4 million, or $0.02 per diluted share, including charges of $0.02 per diluted share as previously reported.
For the 53-week fiscal 2020 full year, as previously reported, net sales were $1.04 billion, compared to net sales of $996.5 million for the 52-week fiscal 2019. Same store sales increased 3.0% for the fiscal 2020 full year despite periods of significant store closures during the year associated with the COVID-19 pandemic. Net income for fiscal 2020 was $55.9 million, or $2.58 per diluted share. Net income for fiscal 2019 was $8.4 million, or $0.40 per diluted share.
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About Big 5 Sporting Goods Corporation
Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties and other factors that may cause Big 5’s actual results in current or future periods to differ materially from forecasted results. These risks and uncertainties include, among other things, the economic impacts of COVID-19 on Big 5’s business operations, including as a result of regulations that may be issued in response to COVID-19, changes in the consumer spending environment, fluctuations in consumer holiday spending patterns, increased competition from e-commerce retailers, breach of data security or other unauthorized disclosure of sensitive personal or confidential information, the competitive environment in the sporting goods industry in general and in Big 5’s specific market areas, inflation, product availability and growth opportunities, changes in the current market for (or regulation of) firearm-related products, disruption in product flow, seasonal fluctuations, weather conditions, changes in cost of goods, operating expense fluctuations, increases in labor and benefit-related expense, changes in laws or regulations, including those related to tariffs and duties, public health issues (including those caused by COVID-19), impacts from civil unrest or widespread vandalism, lower than expected profitability of Big 5’s e-commerce platform or cannibalization of sales from Big 5’s existing store base which could occur as a result of operating the e-commerce platform, litigation risks, stockholder campaigns and proxy contests, risks related to Big 5’s historically leveraged financial condition, changes in interest rates, credit availability, higher expense associated with sources of credit resulting from uncertainty in financial markets and economic conditions in general. Those and other risks and uncertainties are more fully described in Big 5’s filings with the Securities and Exchange Commission, including its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q. Big 5 conducts its business in a highly competitive and rapidly changing environment. Accordingly, new risk factors may arise. It is not possible for management to predict all such risk factors, nor to assess the impact of all such risk factors on Big 5’s business or the extent to which any individual risk factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. Big 5 undertakes no obligation to revise or update any forward-looking statement that may be made from time to time by it or on its behalf.
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