Hibbett Reports Fourth Quarter and Fiscal 2024 Results
- Hibbett, Inc. achieved a solid financial performance with Q4 diluted EPS of $2.55 & full year diluted EPS of $8.17, in line with expectations.
- Q4 comparable sales decreased by 6.4% versus a 15.5% increase in the prior year period, reflecting a challenging retail environment.
- Fiscal 2024 witnessed a 1.2% net sales growth, reaching a record $1.73 billion in sales for Hibbett.
- The company provided an outlook for Fiscal 2025, anticipating flat to 2.0% sales growth, with detailed guidance on various metrics including gross margin, SG&A expenses, operating profit, and diluted EPS.
- Hibbett plans significant investments in store footprint, customer-facing technologies, and back-office infrastructure for long-term profitability.
- The company aims to enhance its product mix in line with consumer spending patterns and expand market reach for Hibbett and City Gear brands.
- None.
Insights
The reported fiscal figures for Hibbett, Inc. indicate a resilient performance in a challenging retail landscape, with a record full fiscal year sales of $1.73 billion. However, the decline in Q4 comparable sales by 6.4% and a full-year net sales growth of merely 1.2% suggest a cautious consumer climate. The shift towards e-commerce, which saw a 6.9% increase, highlights the ongoing digital transformation in retail.
From a market perspective, Hibbett's strategic investments in customer-facing technologies and back-office infrastructure, despite the short-term profitability impact, signal a long-term vision to strengthen its omni-channel presence. The integration of Hibbett Rewards X Nike Membership is a noteworthy attempt to enhance customer loyalty and drive sales across channels.
Investors should note the 18.2% decrease in inventory, which could be a strategic move to optimize stock levels and reduce carrying costs. Additionally, the fiscal 2025 outlook with flat to 2% sales growth and a diluted EPS range of $8.00 to $8.75 reflects management's cautious optimism amidst economic and geopolitical uncertainties.
Examining Hibbett's financial health, the decrease in gross margin by approximately 70 basis points in Q4 and 140 basis points for the full year due to lower product margins and increased occupancy costs is a concern. It reflects margin pressures that are part of wider retail industry challenges including promotional activities and wage inflation.
The company's capital expenditure plans, with a significant increase from $57.9 million in fiscal 2024 to a projected $65 to $75 million in fiscal 2025, underscore a commitment to growth through store development initiatives. This capital allocation, along with the ongoing share repurchase program and quarterly dividends, suggests a balanced approach to using capital for growth and returning value to shareholders.
However, the projected SG&A increase as a percentage of net sales and the anticipated operating profit decline for fiscal 2025 raise some concerns about cost management and profitability. The balance between strategic investments and cost efficiencies will be important for sustaining financial performance.
The growth in e-commerce sales, which now represent 18.9% of total net sales, points to Hibbett's successful navigation of the retail shift towards online shopping. The mid to high-single digit growth projection for e-commerce in fiscal 2025 suggests a strategic focus on this channel.
Understanding the digital consumer's behavior and preferences, the integrated loyalty program with Nike could provide Hibbett with valuable data to personalize the shopping experience and improve customer retention. The emphasis on customer-facing technologies in their capital expenditures reflects an understanding that the digital storefront is just as important as the physical one.
For Hibbett, maintaining a competitive edge in e-commerce will require continuous innovation and an agile response to changing consumer trends. The company's digital strategy seems to acknowledge that the retail experience extends beyond the transaction to include engagement and personalized interactions.
-
Q4 Diluted EPS of
$2.55 $8.17 -
Q4 Comparable Sales Decrease
6.4% Versus a15.5% Increase in the Prior Year Period -
Fiscal 2024 Full Year Net Sales Growth of
1.2% - Issues Fiscal 2025 Outlook
Mike Longo, President and Chief Executive Officer, stated, “We are pleased to report a solid financial performance for the fourth quarter of Fiscal 2024, as we continued to execute our strategy in a dynamic and challenging retail environment. Notably, we finished the year with
Mr. Longo continued, “We are proud of our performance over the past year, demonstrating our team’s ability to consistently execute our strategy and deliver positive financial results. As we look ahead to Fiscal 2025, we will continue to leverage our proven business model to meet customer demand and drive additional market share. We will look for opportunities to enhance our product mix in line with current consumer spending patterns and ensure we have the right inventory mix across our sales channels.”
Mr. Longo concluded, “As we continue to extend our market reach, we believe Hibbett is building momentum, and our sales guidance for the year ahead reflects this confidence. In Fiscal 2025, we plan to continue to make significant investments in our store footprint, customer-facing technologies, and back-office infrastructure. This will impact our profitability growth in the short term but will enhance our value proposition and profitability over the longer term. We remain focused on providing a unique and compelling product assortment supported by our omni-channel platform capabilities and exceptional customer service that allows us to serve our customers wherever and whenever they decide to shop. We look forward to opportunities to continue expanding our Hibbett and City Gear brands while delivering greater value to our customers and shareholders.”
Fourth Quarter Results
The fourth quarter and Fiscal 2024 ended on February 3, 2024. The fourth quarter included 14 weeks of results and Fiscal 2024 included 53 weeks of results.
Net sales for the 14-weeks ended February 3, 2024, increased
Gross margin was
Store operating, selling and administrative (“SG&A”) expenses were
Net income for the 14-weeks ended February 3, 2024, was
During the fourth quarter, we opened 14 new stores and closed 3 stores, bringing the store base to 1,169 in 36 states as of February 3, 2024.
We ended the fourth quarter of Fiscal 2024 with
During the 14-weeks ended February 3, 2024, the Company paid a quarterly dividend equal to
Fiscal 2024 Year Results
Net sales for the 53-weeks ended February 3, 2024, increased
Gross margin was
SG&A expenses were
Net income for the 53-weeks ended February 3, 2024, was
During the 53-weeks ended February 3, 2024, the Company repurchased 1.2 million shares of common stock for a total expenditure of
Capital expenditures during the 53-weeks ended February 3, 2024, were
53rd Week and Fourth Quarter Change in Accounting Estimate
Total net product sales for the 53rd week of Fiscal 2024 were approximately
Full Year Fiscal 2025 Outlook
Please note that the fiscal year ending February 1, 2025 (“Fiscal 2025”), will have 52 weeks versus 53 weeks in Fiscal 2024. A number of business and economic challenges we faced in Fiscal 2024 will continue to impact our business in Fiscal 2025. These challenges include the potential for inflation and interest rates to remain elevated, the continued use of promotional activity to drive traffic, ongoing wage pressures, a more cautious and selective consumer, and ongoing geopolitical conflicts. These factors contribute to the complexity and volatility in forecasting Fiscal 2025 results.
Considering the factors noted above, we are providing an overview of our estimated results for Fiscal 2025. Additional commentary and insight will be provided at our upcoming fourth quarter and full year investor call.
Metric |
Guidance |
Comment |
Total sales |
Flat to up ~ |
Versus 53-week Fiscal 2024 results |
Comp sales |
Flat to negative low-single digit |
Versus weeks 2-53 in Fiscal 2024 |
Brick and mortar comp |
Flat to negative low-single digit |
Versus weeks 2-53 in Fiscal 2024 |
E-commerce comp |
Up mid to high-single digit |
Versus weeks 2-53 in Fiscal 2024 |
Net store growth in units |
~ 45 to 50 |
~ |
Gross margin % |
|
Less promotional |
SG&A % |
|
Store growth, infrastructure investments |
Operating profit % |
|
SG&A deleverage; some margin offset |
Interest expense % |
|
Inventory levels and interest rates stable |
Diluted EPS |
|
|
Diluted shares |
~11.6 to 11.7 million |
|
Tax rate |
|
|
Capital expenditures |
~ |
Focus on store development initiatives |
Sales Guidance
-
Total net sales in Fiscal 2025 are anticipated to be flat to up approximately
2.0% compared to our full year Fiscal 2024 results. - Due to the transition from a 53-week year in Fiscal 2024 to a 52-week year in Fiscal 2025, comparable sales for Fiscal 2025 will be compared to weeks two through 53 in Fiscal 2024. Comparable sales are expected to be flat to down in the low-single digit range for the year. Brick and mortar comparable sales are expected to range from flat to negative low-single digits. Both total e-commerce revenue and comparable e-commerce revenue is anticipated to be up in the mid to high-single digit range.
- Net new store growth is expected to be approximately 45 to 50 units. The first quarter is projected to have the lowest growth with net new units anticipated to be more evenly distributed across the remaining three quarters.
Additional Guidance Commentary
-
Gross margin expectations include a less impactful promotional environment and small leverage gains in freight and logistics partially offset by headwinds in store occupancy. These factors are expected to drive approximately 40 to 70 basis points of improvement in the gross profit percentage in comparison to Fiscal 2024 results. Expected full year gross margin is anticipated to be in the range of
34.2% to34.5% of net sales. -
SG&A as a percent of net sales is expected to increase by approximately 90 to 120 basis points in comparison to Fiscal 2024 results due to new store growth, wage inflation and increased incentive compensation, transaction fees and data processing costs including incremental investment in cloud-based technology solutions. The expected full year SG&A expense range is estimated to be
23.9% to24.2% of net sales. -
Operating profit is expected to be in the range of
7.0% to7.4% of net sales, a decline of approximately 50 to 90 basis points in comparison to Fiscal 2024 results. - It is anticipated there will be debt outstanding under our line of credit for a majority of the year. We believe peak borrowings will be tied closely to the timing of receipts leading up to our peak selling seasons. Interest expense for the full year is projected to be approximately 10 to 20 basis points of net sales.
-
Diluted earnings per share are anticipated to be in the range of
$8.00 $8.75 22.9% and23.2% and an estimated weighted average diluted share count of approximately 11.6 to 11.7 million. -
Capital expenditures are anticipated to be in the range of
$65 $75 million - Our capital allocation strategy continues to include share repurchases and recurring quarterly dividends in addition to the capital expenditures noted above.
Investor Conference Call and Simulcast
Hibbett, Inc. will host a webcast at 9:00 a.m. ET on Friday, March 15, 2024, to discuss the Company’s fourth quarter and full year results. The webcast of Hibbett’s earnings review and a slide deck of supporting information that will be referenced during the webcast will be available at https://investors.hibbett.com/ under the News & Events section. A replay of the webcast will be available for 30 days.
About Hibbett, Inc.
Hibbett, headquartered in
Disclosure Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws. Other than statements of historical facts, all statements which address activities, events, or developments that the Company anticipates will or may occur in the future, including, but not limited to, such things as Fiscal 2025 outlook, future capital expenditures, expansion, strategic plans, financial objectives, dividend payments, stock repurchases, growth of the Company’s business and operations, including future cash flows, revenues, and earnings, our effective tax rate and other such matters, are forward-looking statements. The forward-looking statements contained in this press release reflect our current views about future events and are subject to risks, uncertainties, assumptions, and changes in circumstances that may cause events or our actual activities or results to differ significantly from those expressed in any forward-looking statement. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future events, results, actions, levels of activity, or performance or achievements. Readers are cautioned not to place undue reliance on these forward-looking statements. A number of important factors could cause actual results to differ materially from those indicated by the forward-looking statements, including, but not limited to: changes in general economic or market conditions that could affect overall consumer spending or our industry; changes to the financial health of our customers; our ability to successfully execute our long-term strategies; our ability to effectively drive operational efficiency in our business; the potential impact of new trade, tariff and tax regulations on our profitability; our ability to effectively develop and launch new, innovative and updated products; our ability to accurately forecast consumer demand for our products and manage our inventory in response to changing demands; increased competition causing us to lose market share or reduce the prices of our products or to increase significantly our marketing efforts; the impact of public health crises or other significant or catastrophic events such as extreme weather, natural disasters or climate change; fluctuations in the costs of our products; acceleration of costs associated with the protection of the health of our employees and customers; loss of key suppliers or manufacturers or failure of our suppliers or manufacturers to produce or deliver our products in a timely or cost-effective manner, including due to port disruptions; our ability to accurately anticipate and respond to seasonal or quarterly fluctuations in our operating results; our ability to successfully manage or realize expected results from an acquisition, and other significant investments or capital expenditures; the availability, integration and effective operation of information systems and other technology, as well as any potential interruption of such systems or technology; risks related to data security or privacy breaches; our ability to raise additional capital required to grow our business on terms acceptable to us; our potential exposure to litigation and other proceedings; and our ability to attract key talent and retain the services of our senior management and key employees.
These forward-looking statements are based largely on our expectations and judgments and are subject to a number of risks and uncertainties, many of which are unforeseeable and beyond our control. For additional discussion on risks and uncertainties that may affect forward-looking statements, see “Risk Factors” disclosed in our most recent Annual Report on Form 10-K and other reports the Company files with the Securities and Exchange Commission. Any changes in such assumptions or factors could produce significantly different results. The Company undertakes no obligation to update forward-looking statements, whether as a result of new information, future events, or otherwise.
HIBBETT, INC. AND SUBSIDIARIES |
|||||||||||||||||||
Unaudited Condensed Consolidated Statements of Operations |
|||||||||||||||||||
(Dollars in thousands, except per share amounts) |
|||||||||||||||||||
|
|
|
|
|
|
|
|
||||||||||||
|
February 3, 2024
|
|
January 28, 2023
|
|
February 3, 2024
|
|
January 28, 2023
|
||||||||||||
|
|
% to
|
|
|
% to
|
|
|
% to
|
|
|
% to
|
||||||||
Net sales |
$ |
466,589 |
|
|
$ |
458,295 |
|
|
$ |
1,728,887 |
|
|
$ |
1,708,316 |
|
||||
Cost of goods sold |
|
305,773 |
65.5 |
% |
|
|
297,109 |
64.8 |
% |
|
|
1,145,184 |
66.2 |
% |
|
|
1,106,415 |
64.8 |
% |
Gross margin |
|
160,816 |
34.5 |
% |
|
|
161,186 |
35.2 |
% |
|
|
583,703 |
33.8 |
% |
|
|
601,901 |
35.2 |
% |
SG&A expenses |
|
107,390 |
23.0 |
% |
|
|
99,042 |
21.6 |
% |
|
|
397,674 |
23.0 |
% |
|
|
389,563 |
22.8 |
% |
Depreciation and amortization |
|
12,819 |
2.7 |
% |
|
|
11,457 |
2.5 |
% |
|
|
49,008 |
2.8 |
% |
|
|
43,919 |
2.6 |
% |
Operating income |
|
40,607 |
8.7 |
% |
|
|
50,687 |
11.1 |
% |
|
|
137,021 |
7.9 |
% |
|
|
168,419 |
9.9 |
% |
Interest expense, net |
|
1,048 |
0.2 |
% |
|
|
555 |
0.1 |
% |
|
|
5,372 |
0.3 |
% |
|
|
1,455 |
0.1 |
% |
Income before provision for income taxes |
|
39,559 |
8.5 |
% |
|
|
50,132 |
10.9 |
% |
|
|
131,649 |
7.6 |
% |
|
|
166,964 |
9.8 |
% |
Provision for income taxes |
|
8,675 |
1.9 |
% |
|
|
11,708 |
2.6 |
% |
|
|
28,491 |
1.6 |
% |
|
|
38,907 |
2.3 |
% |
Net income |
$ |
30,884 |
6.6 |
% |
|
$ |
38,424 |
8.4 |
% |
|
$ |
103,158 |
6.0 |
% |
|
$ |
128,057 |
7.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share |
$ |
2.61 |
|
|
$ |
3.00 |
|
|
$ |
8.34 |
|
|
$ |
9.89 |
|
||||
Diluted earnings per share |
$ |
2.55 |
|
|
$ |
2.91 |
|
|
$ |
8.17 |
|
|
$ |
9.62 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding: |
|||||||||||||||||||
Basic |
|
11,834 |
|
|
|
12,790 |
|
|
|
12,364 |
|
|
|
12,951 |
|
||||
Diluted |
|
12,117 |
|
|
|
13,186 |
|
|
|
12,633 |
|
|
|
13,315 |
|
||||
Percentages may not foot due to rounding. |
|||||||||||||||||||
HIBBETT, INC. AND SUBSIDIARIES |
|||||
Unaudited Condensed Consolidated Balance Sheets |
|||||
(Dollars in thousands) |
|||||
|
|
|
|
||
|
February 3, 2024 |
|
January 28, 2023 |
||
Assets |
|
|
|
||
Cash and cash equivalents |
$ |
21,230 |
|
$ |
16,015 |
Inventories, net |
|
344,294 |
|
|
420,839 |
Other current assets |
|
41,191 |
|
|
36,201 |
Total current assets |
|
406,715 |
|
|
473,055 |
|
|
|
|
||
Property and equipment, net |
|
183,949 |
|
|
169,476 |
Operating right-of-use assets |
|
280,755 |
|
|
263,391 |
Finance right-of-use assets |
|
1,837 |
|
|
2,279 |
|
|
|
|
||
Tradename intangible asset |
|
23,500 |
|
|
23,500 |
Deferred income taxes, net |
|
3,024 |
|
|
3,025 |
Other assets, net |
|
9,442 |
|
|
4,434 |
Total assets |
$ |
909,222 |
|
$ |
939,160 |
|
|
|
|
||
Liabilities and Stockholders’ Investment |
|
|
|
||
Accounts payable |
$ |
96,431 |
|
$ |
190,648 |
Credit facility |
|
45,296 |
|
|
36,264 |
Operating lease obligations |
|
71,448 |
|
|
72,544 |
Finance lease obligations |
|
538 |
|
|
1,132 |
Other accrued expenses |
|
22,501 |
|
|
27,164 |
Total current liabilities |
|
236,214 |
|
|
327,752 |
|
|
|
|
||
Long-term operating lease obligations |
|
245,649 |
|
|
229,388 |
Long-term finance lease obligations |
|
1,423 |
|
|
1,305 |
Other noncurrent liabilities |
|
6,911 |
|
|
4,484 |
Stockholders’ investment |
|
419,025 |
|
|
376,231 |
Total liabilities and stockholders’ investment |
$ |
909,222 |
|
$ |
939,160 |
HIBBETT, INC. AND SUBSIDIARIES |
|||||||||||||||
Supplemental Information |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
February 3, 2024
|
|
January 28, 2023
|
|
February 3, 2024
|
|
January 28, 2023
|
||||||||
Sales Information |
|
|
|
|
|
|
|
||||||||
Net sales increase |
|
1.8 |
% |
|
|
19.6 |
% |
|
|
1.2 |
% |
|
|
1.0 |
% |
Comparable sales (decrease) increase |
|
(6.4 |
)% |
|
|
15.5 |
% |
|
|
(3.1 |
)% |
|
|
(2.2 |
)% |
|
|
|
|
|
|
|
|
||||||||
Store Count Information |
|
|
|
|
|
|
|
||||||||
Beginning of period |
|
1,158 |
|
|
|
1,126 |
|
|
|
1,133 |
|
|
|
1,096 |
|
New stores opened |
|
14 |
|
|
|
9 |
|
|
|
44 |
|
|
|
43 |
|
Stores closed |
|
(3 |
) |
|
|
(2 |
) |
|
|
(8 |
) |
|
|
(6 |
) |
End of period |
|
1,169 |
|
|
|
1,133 |
|
|
|
1,169 |
|
|
|
1,133 |
|
Estimated square footage at end of period (in thousands) |
|
6,640 |
|
|
|
6,424 |
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Balance Sheet Information |
|
|
|
|
|
|
|
||||||||
Average inventory per store (in thousands) |
$ |
295 |
|
|
$ |
371 |
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Share Repurchase Information |
|
|
|
|
|
|
|
||||||||
Shares purchased under our stock repurchase program |
|
— |
|
|
|
— |
|
|
|
1,162,130 |
|
|
|
797,033 |
|
Cost (in thousands) |
$ |
— |
|
|
$ |
— |
|
|
$ |
53,211 |
|
|
$ |
38,458 |
|
Settlement of net share equity awards |
|
— |
|
|
|
5,357 |
|
|
|
47,550 |
|
|
|
51,558 |
|
Cost (in thousands) |
$ |
— |
|
|
$ |
365 |
|
|
$ |
2,849 |
|
|
$ |
2,446 |
|
|
|
|
|
|
|
|
|
||||||||
Dividend Information |
|
|
|
|
|
|
|
||||||||
Number of declarations |
|
1 |
|
|
|
1 |
|
|
|
4 |
|
|
|
4 |
|
Cash paid (in thousands) |
$ |
2,943 |
|
|
$ |
3,182 |
|
|
$ |
12,370 |
|
|
$ |
12,881 |
|
Total paid per share |
$ |
0.25 |
|
|
$ |
0.25 |
|
|
$ |
1.00 |
|
|
$ |
1.00 |
|
HIBBETT, INC. AND SUBSIDIARIES |
|||||||||||||||
Fiscal 2024 Comparable Store Sales and Net Sales |
|||||||||||||||
As Originally Reported and Adjusted for Week Shift(1) |
|||||||||||||||
(unaudited) |
|||||||||||||||
|
|
|
|||||||||||||
|
Fiscal 2024 |
||||||||||||||
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
Fiscal
|
||||||
Comparable store sales increase (decrease) - originally reported |
4.1 |
% |
|
(7.3 |
)% |
|
(2.7 |
)% |
|
(6.4 |
)% |
|
(3.1 |
)% |
|
Comparable store sales increase (decrease) - adjusted for week shift |
5.2 |
% |
|
(0.8 |
)% |
|
(8.4 |
)% |
|
(8.1 |
)% |
|
(3.2 |
)% |
|
Impact of week shift |
1.1 |
% |
|
6.5 |
% |
|
(5.7 |
)% |
|
(1.7 |
)% |
|
(0.1 |
)% |
|
|
Fiscal 2024 |
||||||||||||||||
(Dollars in millions) |
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
Fiscal
|
||||||||
Net sales - originally reported |
$ |
455.5 |
|
$ |
374.9 |
|
$ |
431.9 |
|
|
$ |
466.6 |
|
|
$ |
1,728.9 |
|
Net sales - adjusted for week shift |
$ |
460.7 |
|
$ |
401.3 |
|
$ |
406.7 |
|
|
$ |
437.4 |
|
|
$ |
1,706.1 |
|
Impact of week shift |
$ |
5.2 |
|
$ |
26.4 |
|
$ |
(25.2 |
) |
|
$ |
(29.2 |
) |
|
$ |
(22.8 |
) |
(1) Due to the 53rd week in Fiscal 2024, each quarter in Fiscal 2025 starts one week later than the same quarter in Fiscal 2024. The charts above present comparable store sales and net sales for Fiscal 2024 as originally reported and as adjusted to represent the same 13-week period as the Fiscal 2025 quarters. |
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View source version on businesswire.com: https://www.businesswire.com/news/home/20240315971070/en/
Robert Volke - SVP, Chief Financial Officer
Gavin Bell - VP, Finance & Investor Relations
(205) 944-1312
Source: Hibbett, Inc.
FAQ
What were Hibbett's Q4 diluted EPS and full year diluted EPS?
How did Q4 comparable sales perform compared to the prior year?
What was the net sales growth for Fiscal 2024?
What is the sales guidance for Fiscal 2025?
What investments does Hibbett plan for Fiscal 2025?
