Hibbett Sports (HIBB) Misses Q1 EPS by 28c, FY EPS Guidance Tops Consensus

Hibbett Sports (NASDAQ: HIBB) reported Q1 EPS of $2.89, $0.28 worse than the analyst estimate of $3.17. Revenue for the quarter came in at $424.1 million versus the consensus estimate of $431.2 million.

GUIDANCE:

Hibbett Sports sees FY2023 EPS of $9.75-$10.50, versus the consensus of $9.74.

• Total net sales are expected to be relatively flat in dollars compared to our Fiscal 2022 results. This implies comparable sales are expected to be in the negative low-single digits for the full year. Brick and mortar comparable sales are expected to be in the negative low-single digit range while e-commerce revenue is anticipated to be in the positive mid-single digit range.
• It is anticipated that comparable sales will be in the negative low-teen range in the first half of the year with an expectation of positive high-single digit comp sales in the second half of the year. Sales forecasts are based on assumptions that as the year progresses, supply chain disruptions moderate, the timing of inventory receipts becomes more consistent and predictable, and our overall inventory position remains strong.
• Net new store growth is expected to be in the range of 30 to 40 stores with units spread relatively evenly throughout the year.
• As a result of potential supply chain disruption, higher freight costs, a higher mix of e-commerce sales, inflationary pressures and some deleverage of store occupancy costs, gross margin as a percent of net sales is anticipated to decline by approximately 130 to 160 basis points compared to Fiscal 2022 results. This expected full year gross margin range of 36.6% to 36.9% is above pre-pandemic levels. We expect gross margin results in comparison to the prior year will become more favorable as the year progresses.
• SG&A as a percent of net sales is expected to increase by 70 to 100 basis points in comparison to Fiscal 2022 results due to wage inflation, deleverage of fixed costs driven by relatively flat sales expectations and annualization of back-office infrastructure investments in Fiscal 2022. The expected full year SG&A expense range of 23.3% to 23.6% as a percent of net sales is below pre-pandemic levels. We expect year-over-year quarterly SG&A comparisons will become less challenging in the back half of the year due to an expectation of an improving inventory and sales environment.
• Operating income is expected to be in the low double-digit range as a percent of sales, also above pre-pandemic levels.
• Diluted earnings per share are anticipated to be in the range of $9.75 - $10.50 using an estimated full year tax rate of 24.5% and an estimated weighted average diluted share count of 13.5 million.
• Capital expenditures are anticipated to be in the range of $60 to $70 million dollars with a focus on new store growth, remodels and additional technology and infrastructure investments.
• Our capital allocation strategy continues to include stock repurchases and recurring quarterly dividends in addition to the capital expenditures noted above.

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

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