On June 4, 2024, Sportsman's Warehouse Holdings Inc (SPWH, Financial) released its 8-K filing announcing financial results for the thirteen weeks ended May 4, 2024. Sportsman's Warehouse Holdings Inc, together with its subsidiaries, operates as an outdoor sporting goods retailer. The company offers a one-stop shopping experience for hunting, shooting, fishing, and camping gear, providing products such as backpacks, jackets, hiking boots, GPS devices, and fishing rods.
Performance Overview
For the first quarter of fiscal year 2024, Sportsman's Warehouse Holdings Inc (SPWH, Financial) reported net sales of $244.2 million, a decrease from $267.5 million in the same period last year. This decline was primarily attributed to lower sales demand due to consumer inflationary pressures and decreased discretionary spending, partially offset by the opening of 11 new stores over the past year. Same store sales decreased by 13.5% compared to the first quarter of fiscal year 2023.
Gross profit for the quarter was $73.8 million, or 30.2% of net sales, compared to $80.0 million, or 29.9% of net sales, in the corresponding period of fiscal year 2023. The increase in gross profit percentage was driven by an improved product mix and rate in the fishing category.
Financial Achievements and Challenges
Selling, general, and administrative (SG&A) expenses were $94.4 million, or 38.7% of net sales, compared to $99.0 million, or 37.0% of net sales, in the first quarter of fiscal year 2023. The decrease in absolute dollars was largely due to expense management initiatives, which reduced overall payroll and new store pre-opening expenses. However, this was partially offset by higher rent and depreciation expenses due to the opening of new stores.
The company reported a net loss of $(18.1) million, compared to a net loss of $(15.6) million in the first quarter of fiscal year 2023. Adjusted net loss was $(17.8) million compared to an adjusted net loss of $(14.8) million in the same period last year. Adjusted EBITDA was $(8.7) million, compared to $(7.8) million in the corresponding prior-year period.
“Although our results continue to be affected by a challenging macroenvironment, we continue to execute on our efforts on resetting the organization to focus on providing our passionate customers with great gear and exceptional service,” said Paul Stone, President and Chief Executive Officer of Sportsman’s Warehouse.
Key Financial Metrics
| Metric | Q1 2024 | Q1 2023 | YOY Variance |
|---|---|---|---|
| Net Sales | $244.2 million | $267.5 million | $(23.3) million |
| Gross Profit | $73.8 million | $80.0 million | $(6.2) million |
| SG&A Expenses | $94.4 million | $99.0 million | $(4.6) million |
| Net Loss | $(18.1) million | $(15.6) million | $(2.5) million |
| Adjusted EBITDA | $(8.7) million | $(7.8) million | $(0.9) million |
Balance Sheet and Cash Flow
As of May 4, 2024, the company ended the first quarter with net debt of $161.8 million, comprised of $2.2 million in cash and cash equivalents and $164.0 million in borrowings under the revolving credit facility. Total inventory at the end of the quarter was $391.6 million. Total liquidity was $80.8 million, including $78.6 million of availability on the revolving credit facility and $2.2 million in cash and cash equivalents.
Outlook for Fiscal Year 2024
Sportsman's Warehouse Holdings Inc (SPWH, Financial) reaffirmed its guidance for fiscal year 2024, expecting net sales to be in the range of $1.15 billion to $1.23 billion and adjusted EBITDA to be between $45 million and $65 million. Capital expenditures for 2024 are anticipated to be between $20 million and $25 million, primarily for technology investments related to merchandising and store productivity. No new store openings are currently planned.
“We continue to closely manage our variable operating expenses and inventory levels as we carefully navigate this challenging macroenvironment,” said Jeff White, Chief Financial Officer of Sportsman’s Warehouse.
For more detailed information, please refer to the 8-K filing.
Explore the complete 8-K earnings release (here) from Sportsman's Warehouse Holdings Inc for further details.
