Hibbett Sports (HIBB) Tops Q1 EPS by $2.23, Revenues Beat; Offers FY22 EPS Guidance Above Consensus

Hibbett Sports (NASDAQ: HIBB) reported Q1 EPS of $5.00, $2.23 better than the analyst estimate of $2.77. Revenue for the quarter came in at $506.9 million versus the consensus estimate of $412.92 million.

• Comparable Sales Increase 87.3% Versus Fiscal 2021
• Comparable Sales Increase 51.4% Versus Fiscal 2020
• Record Quarterly Earnings Per Diluted Share of $5.00

Mike Longo, President and Chief Executive Officer, commented, “Our Fiscal 2022 is off to an excellent start as our business continues to build on the strong momentum we experienced last year. Record quarterly sales and earnings were a result of our continued commitment to offering a compelling assortment of merchandise combined with our trademark superior customer service and a best-in-class omni-channel platform. New customer retention, improved store level engagement, government stimulus, and access to coveted brand name products contributed to our comparable sales growth of 87.3% during the quarter and drove additional transactions and a higher average ticket across our store base and online platform.”

Mr. Longo continued, “The robust demand we experienced during our first quarter in addition to the ongoing constraints in the supply chain limited our opportunity to build our inventory position during the quarter. However, we believe our ability to consistently deliver in-demand footwear, apparel, and accessories to underserved communities has strengthened our vendor partnerships, increased our loyalty program membership, and continues to attract new customers.”

Finally, Mr. Longo added, “The impressive results we have experienced since the beginning of the COVID-19 pandemic reflect our team members’ diligence and dedication toward providing an exceptional customer experience by executing our toe-to-head merchandising strategy successfully. We will continue to make investments in our store base and in technology across our omni-channel platform to further enhance our customer experience as well as improve internal business processes.”

GUIDANCE:

Hibbett Sports sees FY2022 EPS of $8.50-$9.00, versus the consensus of $5.65.

Given the strong performance in the first quarter, we are updating our financial guidance for Fiscal 2022, which ends January 29, 2022. Due to uncertainty in the business environment, potential legislation that could negatively impact our business, changes in consumer spending habits and ongoing supply chain disruptions, forecasting future results remains difficult and we are therefore providing limited forward guidance regarding our updated outlook for Fiscal 2022.

Our projected financial results for Fiscal 2022 are influenced by many factors, several of which are discussed below:

• We attracted new customers to our store locations and to our omni-channel platform in Fiscal 2021 due to pent-up demand, market disruption and government stimulus payments. Many of these new customers made repeat purchases. We expect to continue to attract and retain new customers during Fiscal 2022.
• Accelerating consumer adoption of e-commerce, which we believe is likely a permanent change, will continue to benefit our omni-channel business.
• Our strong vendor relationships allow us to meet customer demand for athletic-inspired fashion footwear, apparel and accessories both in-store and online.
• Other initiatives, including net low double digit unit store growth per brand, an improved in-store experience resulting from our store refresh program, increased speed to market via supply chain enhancements and an improved focus on our sales culture.

Specific items not factored into our outlook include further government stimulus payments, unannounced and/or unexpected market disruption, changes to the Federal minimum wage or significant wage inflation, increases in corporate tax rates and shifts in consumer spending habits.

Based on the considerations above and our results in the first quarter, we forecast the following GAAP results for Fiscal 2022:

• Comparable sales versus the prior year are expected to be in a range from positive high-single digits to positive low-double digits, up from previous guidance of negative low-single digits to positive low-single digits;
• Gross margin is expected to be lower over the next three quarters in relation to the first quarter of Fiscal 2022, but is expected to be favorable to both GAAP and adjusted Fiscal 2021 gross margin on a full year basis versus previous guidance projecting an unfavorable performance to the prior year;
• SG&A is expected to increase as a percent of sales over the next three quarters in comparison to the first quarter of Fiscal 2022, but is still anticipated to decline as a percent of sales in comparison to both GAAP and adjusted SG&A in Fiscal 2021 on a full year basis;
• Diluted earnings per share in the range of $8.50 to $9.00, assuming an effective tax rate of approximately 25.0% and a weighted average diluted share count of approximately 16.9 million.

For earnings history and earnings-related data on Hibbett Sports (HIBB) click here.

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