Hibbett Sports (HIBB) reported a 27.5% jump in earnings for the first quarter of 2020 as improved performance in both the store and e-commerce channels drove revenues higher. The results exceeded analysts’ expectations. Further, the company raised its earnings guidance for fiscal 2020.
Net income climbed by 27.5% to $27.42 million and earnings surged by 32% to $1.48 per share. Adjusted earnings jumped by 44% to $1.61 per share.
Net sales soared by 25% to $343.4 million as comparable store sales increased by 5.1%. Comparable store sales will not include sales from City Gear until the fourth quarter of Fiscal 2020. E-commerce sales represented 8.3% of total sales for the first quarter. Strength in footwear and sneaker-connected apparel & accessories continued to offset softer sales in licensed products and team sports.
Looking ahead into fiscal 2020, the company lifted its earnings guidance to the range of $1.70 to $1.85 per share from the prior range of $1.50 to $1.70 per share. The adjusted earnings forecast is raised to the range of $2.00 to $2.15 per share from the previous range of $1.80 to $2.00 per share.
Comparable store sales growth are now anticipated to be in the range of 0.5% to 2% compared to the previous forecast range of down 1% to up 1%. Capital expenditures are still projected to be about $18 million to $22 million and share repurchase is still predicted to be in the range of $10 million to $15 million.
The company said its traffic in stores and online was translated from the improved web traffic and mobile app, along with continued traction in Buy Online, Pickup in Store. Hibbett is moving forward with its plan to close most unproductive stores. This included closing about 95 Hibbett stores in fiscal 2020, which is expected to result in non-recurring impairment and store closure charges in the range of $0.15 to $0.15 per share in fiscal 2020.
For the quarter, Hibbett opened three new stores, rebranded two Hibbett stores to City Gear stores, expanded one high-performing store, and closed 24 underperforming stores bringing the store base to 1,144 in 35 states as of May 4, 2019.
During the previous fourth-quarter, the company posted a 32% plunge in earnings due to higher costs and expenses. Net sales increased by 14.7% as comparable store sales inched up 3.8%. E-commerce sales represented 10.6% of total sales for the fourth quarter.
Shares of Hibbett Sports ended Thursday’s regular session down 1% at $19.82 on the Nasdaq. Following the earnings release, the stock inched up over 1% in the premarket session.