Hibbett Sports Inc. (HIBB, Financial) released its fiscal third-quarter 2021 earnings on Nov. 20 before the market opened. The company's earnings and revenue surpassed expectations and were up compared to the same quarter last year.
Shares surged 10% in premarket trading following the earnings announcement.
Performance at a glance
The company's net profit for the quarter was $25.3 million, resulting in earnings per share of $1.47, up from a net profit of $2.3 million, or $0.13 per share, for the year-ago quarter. The company's adjusted earnings per share stood at $1.45, which was more than the $0.32 reported last year. Analysts had predicted adjusted EPS of 45 cents per share.
Revenue of $331.4 million was up 20.3% year-over-year and surpassed analyst predictions of $286 million. The quarter's revenue reflected persistent strength in the omni-channel, high new customer retention, market disturbance and availability of sought-after products like footwear, apparel and accessories.
CEO Mike Longo had the following to say:
"Our recent performance exemplifies the effort of our team members and the resiliency of our business model. With ongoing expected market disruption and improvements to our operations, we remain optimistic the positive momentum we have enjoyed for most of this year will continue through the remainder of Fiscal 2021. The direction of the pandemic is uncertain, but we will continue to adapt and safeguard our customers and team members, while also striving to generate positive returns."
Comparable store sales for the quarter ended Oct. 31 jumped by 21.2%. E-commerce sales jumped a mammoth 50.7% and made up 13.2% of the total net sales of the quarter. SG&A expenses declined to 26.1% of sales compared to 29.1% of sales in the year-ago quarter as the coronavirus-related costs were more than offset by an increase in net sales. Additionally, lower costs and integration expenses related to City Gear acquisition helped.
The company's balance of cash and cash equivalents stood at $177.7 million at the quarter's end.
Inventory position and store details
At the end of the quarter, the company had inventory of $210.9 million, which reflected a decline of 27% from the fiscal third quarter of the previous year. This reflected efforts to manage strong brick and mortar and e-commerce demand.
During the quarter, the Alabama-based sporting goods retailer did not launch new stores and rebranded two Hibbett stores to City Gear stores. Additionally, the company shut down as many as five stores, which included underperforming stores and stores meant for rebranding. As of Oct. 31, the company had a total of 1,074 stores in 35 states.
Outlook
The company has provided guidance for the fourth quarter of fiscal 2021. The company projects diluted EPS to be between $1.00 and $1.10 and comparable sales to rise in the high-single digits to low-double digits range.
Disclosure: I do not hold any positions in the stocks mentioned.
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