DICK'S Sporting Goods (DKS) 8-K Dick’s Sporting Goods Reports 32% Increase in 2nd Quarter Net Income

EXHIBIT 99.1

PRESS RELEASE

Dick’s Sporting Goods Reports 32% Increase in 2nd Quarter Net Income

PITTSBURGH, Pa., August 21, 2003 — Dick’s Sporting Goods, Inc. (NYSE: DKS) today reported sales and earnings results for the second quarter ended August 2, 2003.

Net income for the second quarter ended August 2, 2003 increased 32% to $15.5 million, or $0.62 per diluted share, compared to $11.7 million or $0.61 per diluted share, respectively for the quarter ended August 3, 2002. Earnings per share increased at a lower rate than net income due to an increase in shares resulting from the Company’s IPO. Total sales for the quarter increased 14% to $353.5 million. Comparable store sales increased 1.5%.

Net income increased 31% and earnings per share increased 17% compared to pro-forma net income of $11.9 million or $0.53 per diluted share in the second quarter of last year. Prior period pro-forma results include a reduction of interest expense and an increase in diluted shares as if the Company had consummated its initial public offering at the beginning of the second quarter last year rather than on the October 15, 2002 effective date.

The Company noted that the following were included in the second quarter results:

• Net income included $0.4 million of after-tax expense relating to additional employer payroll taxes required as a result of the exercise of employee stock options.

• Net income also included an after-tax gain of $0.7 million resulting from the sale of a portion of the Company’s non-cash investment in its third party internet commerce provider.

• Fully-diluted shares outstanding increased to 25.1 million, exceeding the previous guidance of 24.6 million, as a result of a higher stock price and the exercise of stock options.

Excluding these items, net income for the second quarter would have been $15.2 million or $0.60 per share, using 25.1 million fully-diluted shares outstanding.

Income from operations increased 23% to $25.1 million as compared to GAAP and pro-forma income from operations in the comparable period last year.

“While the environment for sales in the second quarter was impacted by poor weather throughout the majority of our markets, we were pleased to have been able to drive comp sales higher while increasing our gross margin rate, which drove a 23% increase in operating income,” said Edward W. Stack, Chairman and CEO. “Additionally, our inventory is in good shape with inventory per square foot equal to last year after factoring in higher levels of in transit private label inventory and inventory for stores opening in the third quarter.”

Second Quarter Store Openings

During the second quarter, the Company opened 2 new stores, one opening earlier than had been anticipated. The new stores are located in East Hanover, NJ (the fourth store in Northern New Jersey) and Portland, ME (the first store in Maine). As of August 2, 2003, the Company operated 151 stores in 27 states.

Year-to-date Results

Net income for the 26 weeks ended August 2, 2003 increased 34% to $22.1 million, or 6% to $0.90 per diluted share, compared to $16.4 million or $0.85 per diluted share, respectively for the 26 weeks ended August 3, 2002. Total sales for the 26 weeks ended August 2, 2003 increased 12% to $658.2 million. Comparable store sales increased 0.4%.

Net income increased 32% and earnings per share increased 20% compared to pro-forma net income of $16.7 million or $0.75 per diluted share for the 26 weeks ended August 3, 2002. Prior period pro-forma results include a reduction of

interest expense and an increase in diluted shares as if the Company had consummated its initial public offering at the beginning of the first quarter last year rather than on the October 15, 2002 effective date.

Third Quarter and Full Year Outlook

The Company’s current outlook for the full year and third quarter of 2003 is based on current expectations and includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act as described later in this release. Although the Company believes that comments reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct.

Third Quarter 2003

• Based on an estimated 25.5 million fully-diluted shares outstanding, EPS for the third quarter is expected to be $0.15 – 0.17 per diluted share, a 15 – 31% increase over the prior year’s third quarter pro-forma EPS of $0.13 (or an increase of 7 – 21% versus $0.14 per share on a GAAP basis).

• Net income is expected to be $3.8 – 4.3 million, compared to last year’s pro-forma net income of $2.9 million (or $2.8 million on a GAAP basis) in the third quarter, an increase of 31 – 48% (or an increase of 36 – 54% on a GAAP basis).

• The Company expects to open ten stores during the third quarter, bringing the year to date total to 20 stores.

Full Year 2003

The Company updated the outlook for the full year as provided previously.

• Based on an estimated 25.1 million fully-diluted shares outstanding, the Company reaffirmed it expects to report EPS for the full year of $1.95 per diluted share, compared to pro-forma EPS of $1.72 in the prior year (or $1.87 on a GAAP basis). This updated guidance represents a 0.5 million increase in fully-diluted outstanding shares and no change in EPS for the full year, as compared to earlier guidance.

• Net income is expected to be $49.0 million, compared to last year’s pro-forma net income of $38.6 million (or $38.3 million on a GAAP basis), an increase of 27% (or an increase of 28% on a GAAP basis). This represents a $1 million increase in net income as compared to prior guidance with no change to EPS guidance due to the increased share count.

• Comparable store sales are expected to increase approximately 1-2%, based on actual results through the second quarter.

• The Company expects to open 22 stores during the year, an increase of 2 stores over previous guidance.

Conference Call Info

The Company will be hosting a conference call today at 1:00 pm Eastern time to discuss the second quarter results. Investors will have the opportunity to listen to the earnings conference call over the internet through the Company’s web site located at http://www.dickssportinggoods.com/investors. To listen to the live call, please go to the web site at least fifteen minutes early to register, download and install any necessary audio software.

For those who cannot listen to the live broadcast, the webcast will be archived on the Company’s web site for approximately 30 days. In addition, a dial-in replay will be available shortly after the call. To listen, investors should dial (888) 286-8010 (domestic callers) or (617) 801-6888 (international callers) and enter confirmation code 51090369. The dial-in replay will be available for 7 days following the live call.

Forward Looking Statements

Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. You can identify these statements by forward looking words such as “may,” “will,” “expect,” “anticipate,” “believe,” “guidance,” “estimate,” “intend,” “predict,” and “continue” or similar words. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company’s actual results in future periods to differ materially from forecasted results. Those risks and uncertainties are more fully described in the Company’s Annual Report on Form 10-K as filed with the Securities and Exchange Commission on April 29, 2003. The Company disclaims any obligation to update any such factors or to publicly announce results of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.

About Dick’s Sporting Goods, Inc.

Pittsburgh-based Dick’s Sporting Goods, Inc. is an authentic full-line sporting goods retailer offering a broad assortment of brand name sporting goods equipment, apparel, and footwear in a specialty store environment. As of August 2, 2003, the Company operated 151 stores in 27 states throughout the Eastern half of the U.S.

Dick’s Sporting Goods, Inc. news releases are available at http://www.dickssportinggoods.com/ (click on the Investor Relations link at the bottom of the home page).

Contact:

Michael F. Hines EVP – Chief Financial Officer or
Jeffrey R. Hennion, VP – Finance & Treasurer
412-788-6066
investors@dcsg.com

DICK’S SPORTING GOODS, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME — UNAUDITED
(Dollars in thousands, except per share data)

		GAAP				Pro-Forma		GAAP				Pro-Forma
		13 Weeks Ended				13 Weeks Ended		26 Weeks Ended				26 Weeks Ended
		August 2,		August 3,		August 3,		August 2,		August 3,		August 3,
		2003		2002		2002		2003		2002		2002
Net sales		$	353,521	$	310,123	$	310,123	$	658,249	$	586,758	$	586,758
Cost of goods sold, including occupancy and distribution costs			256,973		229,770		229,770		478,854		436,366		436,366
	GROSS PROFIT		96,548		80,353		80,353		179,395		150,392		150,392
Selling, general and administrative expenses			70,284		58,956		58,956		139,085		118,024		118,024
Pre-opening expenses			1,162		977		977		3,619		3,212		3,212
	INCOME FROM OPERATIONS		25,102		20,420		20,420		36,691		29,156		29,156
Gain on sale of investment			1,212		—		—		1,212		—		—
Interest expense, net			535		886		668		1,040		1,740		1,304
	INCOME BEFORE INCOME TAXES		25,779		19,534		19,752		36,863		27,416		27,852
Provision for income taxes			10,312		7,814		7,901		14,745		10,967		11,141
	NET INCOME	$	15,467	$	11,720	$	11,851	$	22,118	$	16,449	$	16,711
EARNINGS PER COMMON SHARE:
	Basic	$	0.69	$	0.70	$	0.60	$	1.03	$	0.98	$	0.85
	Diluted	$	0.62	$	0.61	$	0.53	$	0.90	$	0.85	$	0.75
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
	Basic		22,364		16,827		19,599		21,439		16,827		19,599
	Diluted		25,108		19,362		22,176		24,574		19,365		22,179

DICK’S SPORTING GOODS, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS — UNAUDITED
(Dollars in thousands)

			August 2,		August 3,			February 1,
			2003		2002			2003
ASSETS
CURRENT ASSETS:
	Cash		$	16,264	$	13,874		$	11,120
	Accounts receivable, net			24,518		11,103			16,391
	Inventories, net			296,708		248,606			233,497
	Prepaid expenses and other current assets			6,929		5,503			5,572
	Deferred income taxes			11,781		5,294			8,697
		Total current assets		356,200		284,380			275,277
	Property and equipment, net			79,109		76,343			80,109
	Construction in progress — leased facilities			7,053		—			—
	Other assets			25,609		15,734			20,840
TOTAL ASSETS			$	467,971	$	376,457		$	376,226
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
	Accounts payable		$	148,519	$	127,553		$	125,208
	Accrued expenses			53,481		45,848			59,239
	Deferred revenue and other liabilities			17,475		13,468			22,752
	Income taxes payable			—		4,553			12,763
	Current portion of long-term debt and capital leases			502		211			213
		Total current liabilities		219,977		191,633			220,175
LONG-TERM LIABILITIES:
	Revolving credit borrowings			21,606		90,299			—
	Long-term debt and capital leases			3,707		3,466			3,364
	Non-cash obligations for construction in progress — leased facilities			7,053		—			—
	Deferred revenue and other liabilities			14,877		12,074			12,188
		Total long-term liabilities		47,243		105,839			15,552
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY:
	Preferred Stock			—		—			—
	Common stock			157		168			126
	Class B common stock			74		—			77
	Additional paid-in capital			164,557		96,279			130,071
	Retained earnings (accumulated deficit) (1)			32,343		(11,588	)		10,225
	Note receivable for common stock			—		(6,196	)		—
	Accumulated other comprehensive income			3,620		322			—
		Total stockholders’ equity		200,751		78,985			140,499
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY			$	467,971	$	376,457		$	376,226

(1) Includes $63,897 of accretion on previously outstanding redeemable preferred stock to its redemption value through a charge to accumulated deficit.

DICK’S SPORTING GOODS, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS — UNAUDITED
(Dollars in thousands)

				26 Weeks Ended
				August 2,			August 3,
				2003			2002
CASH FLOWS FROM OPERATING ACTIVITIES:
	Net income			$	22,118		$	16,449
	Adjustments to reconcile net income to net cash used in operating activities:
		Depreciation and amortization			7,288			6,579
		Deferred income taxes			(3,498	)		(75	)
		Tax benefit from exercise of stock options			21,489			—
		Gain on sale of investment			(1,212	)		—
		Other non-cash items			2,067			—
		Changes in assets and liabilities:
			Accounts receivable		(9,329	)		3,313
			Inventories		(63,211	)		(47,022	)
			Prepaid expenses and other assets		(400	)		(1,816	)
			Accounts payable		14,639			26,176
			Accrued expenses		(5,758	)		(1,163	)
			Income taxes payable		(12,763	)		(1,173	)
			Deferred revenue and other liabilities		(5,315	)		(4,214	)
	Net cash used in operating activities				(33,885	)		(2,946	)
CASH FLOWS FROM INVESTING ACTIVITIES:
			Proceeds from sale-leaseback transactions		9,398			3,094
			Capital expenditures		(16,978	)		(14,169	)
			Decrease in recoverable costs from developed properties		1,203			—
			Proceeds from sale of investment		1,470			—
	Net cash used in investing activities				(4,907	)		(11,075	)
CASH FLOWS FROM FINANCING ACTIVITIES:
			Revolving credit borrowings, net		21,606			13,226
			Borrowings (payments) on long-term debt and capital leases		632			(111	)
			Proceeds from sale of common stock under employee stock purchase plan		1,342			—
			Proceeds from exercise of stock options		11,501			—
			Increase in bank overdraft		8,672			5,804
			Other		183			—
	Net cash provided by financing activities				43,936			18,919
NET INCREASE IN CASH					5,144			4,898
CASH, BEGINNING OF PERIOD					11,120			8,976
CASH, END OF PERIOD				$	16,264		$	13,874
Supplemental non-cash investing and financing activities:
	Construction in progress — leased facilities			$	7,053		$	—

Regulation G Reconciliations

The Company believes the use of pro-forma results for prior periods provides a more meaningful comparison to the current period results due to the significant increase in share count since October 15, 2002 when the Company completed its initial public offering, and the related reduction in interest expense due to the application of the net proceeds thereof. The reconciliations of the pro-forma financial information to the most directly comparable GAAP financial information is presented below (dollars in millions, except per share data):

	13 Weeks Ended		26 Weeks Ended		13 Weeks Ended		Year Ended
	August 3,		August 3,		November 2,		February 1,
	2002		2002		2002		2003
Net income	$	11.7	$	16.5	$	2.8	$	38.3
Interest expense reduction (after tax)		0.2		0.2		0.1		0.3
Pro-forma net income	$	11.9	$	16.7	$	2.9	$	38.6
Diluted shares		19.4		19.4		19.4		20.5
Public offering adjustment		2.8		2.8		2.8		2.0
Pro-forma diluted shares		22.2		22.2		22.2		22.5
Pro-forma diluted earnings per share	$	0.53	$	0.75	$	0.13	$	1.72

The Company believes the use of adjusted net income for the current period provides a further understanding as compared to the prior period results due to the current period containing a gain on sale of investment and the additional employer payroll taxes required as a result of stock option exercises. The reconciliation of the pro-forma financial information to the most directly comparable GAAP financial information is presented below (dollars in thousands, except per share data):

	13 Weeks Ended
	August 2,
	2003
Net income	$	15,468
Gain on sale of investment (after tax)		(727	)
Employer payroll taxes (after tax)		416
Adjusted net income	$	15,157
Diluted shares		25,108
Adjusted diluted earnings per share	$	0.60