[BIG 5 SPORTING GOODS LOGO]
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Contacts:
Big 5 Sporting Goods Corporation
Charles Kirk
Sr. Vice President and Chief Financial Officer
(310) 536-0611
John Mills
Integrated Corporate Relations, Inc.
(310) 395-2215
BIG 5 SPORTING GOODS CORPORATION ANNOUNCES FISCAL 2004 SECOND QUARTER RESULTS
- SECOND QUARTER 2004 DILUTED EPS INCREASES 25% TO $0.35 BEFORE $0.02
DEBT REDEMPTION CHARGE, VERSUS $0.28 IN SECOND QUARTER 2003
- SAME STORE SALES INCREASE OF 3.9% REPRESENTS 34TH CONSECUTIVE
QUARTER OF SAME STORE SALES GROWTH
- CONFERENCE CALL SCHEDULED FOR TODAY AT 2:00 P.M. (PACIFIC);
SIMULTANEOUS WEBCAST AT WWW.BIG5SPORTINGGOODS.COM
EL SEGUNDO, CA - AUGUST 4, 2004 - Big 5 Sporting Goods Corporation (Nasdaq:
BGFV), a leading sporting goods retailer, today reported financial results for
the fiscal 2004 second quarter and six months ended June 27, 2004.
For the 2004 second quarter, net sales increased 8.5% to $184.5 million from
$170.1 million in the second quarter of fiscal 2003. Same store sales increased
3.9% versus the same quarter last year, representing the company's 34th
consecutive quarter of same store sales growth over comparable prior periods.
Net income for the 2004 second quarter increased to $8.0 million, or $0.35 per
diluted share excluding a charge of $0.5 million, or $0.02 per diluted share,
net of taxes, associated with the redemption of $15.0 million principal amount
of the company's 10.875% senior notes. These figures compare to net income of
$6.3 million, or $0.28 per diluted share, in the same period last year. Net
income, calculated in accordance with generally accepted accounting principles
("GAAP"), was $7.5 million, or $0.33 per diluted share, for the 2004 second
quarter.
For the six-month period ended June 27, 2004, net sales increased 9.2% to $365.5
million from $334.6 million in the same period last year and same store sales
increased 4.5% versus the same six months of 2003. Net income in the first half
of fiscal 2004 was $14.8 million, or $0.65 per diluted share excluding the
aforementioned second quarter debt redemption charge, compared to $10.5 million,
or $0.46 per diluted share excluding a similar debt redemption charge of $0.9
million, or $0.04 per diluted share, net of taxes, for the same period in fiscal
2003. Net income, calculated in accordance with GAAP, increased to $14.3
million, or $0.63 per diluted share, for the first six
Big 5 Sporting Goods
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months of fiscal 2004, compared to net income of $9.7 million, or $0.43 per
diluted share, in the same period last year.
"We are pleased to have achieved another very solid performance for Big 5
Sporting Goods," said Steven G. Miller, Big 5's Chairman, President and Chief
Executive Officer. "Our focused approach to drive top-line sales allowed us to
realize comp store gains in each of our five geographic regions and for each of
our three major merchandise categories - footwear, apparel and hard goods. Our
proven business model continues to perform well and we feel we are positioned to
continue our strong performance going forward."
Big 5 reports net income and earnings per diluted share in accordance with GAAP
and additionally on a pro forma basis to exclude certain effects of the
company's senior note redemptions (as described above). Big 5 uses this pro
forma reporting internally to evaluate its operating performance without regard
to certain financial effects of its partial senior note redemptions and believes
this presentation will provide investors with additional insight into its
operating results. A reconciliation of the senior note redemptions pro forma
adjustments to GAAP appears in the financial statements portion of this release.
STORE OPENINGS
The company ended the fiscal 2004 second quarter operating 295 stores, opening
one new store during the quarter. The company anticipates opening between 13 and
16 additional new stores by the end of fiscal 2004.
EPS GUIDANCE
Big 5 expects to realize same store sales growth in the low single-digit range
for the third fiscal quarter of 2004, resulting in earnings per diluted share in
the range of $0.34 to $0.36. For the 2004 fiscal year, the company expects to
realize same store sales growth in the low to mid-single-digit range and expects
pro forma earnings to be in the range of $1.55 to $1.61 per diluted share, which
is unchanged from previous guidance. The full year estimate of earnings per
diluted share excludes the $0.02 per diluted share charge recorded in the second
quarter associated with a redemption of $15.0 million principal amount of the
company's 10.875% senior notes. Fiscal 2004 will include 53 weeks for accounting
purposes, with the extra week being included in the company's fourth quarter
results. This additional week should add approximately 1.75% to fiscal 2004
sales versus fiscal 2003, but should not have a material impact on earnings
results for the fourth quarter or fiscal year.
CONFERENCE CALL INFORMATION
Big 5 will host a conference call and audio webcast today at 2:00 p.m. (Pacific)
to discuss financial results for the quarter ended June 27, 2004. The webcast
will be available at www.big5sportinggoods.com and archived for 30 days.
ABOUT BIG 5 SPORTING GOODS CORPORATION
Big 5 is the leading sporting goods retailer in the western United States,
operating 295 stores in 10 states under the "Big 5 Sporting Goods" name. Big 5
provides a full-line product offering in a traditional sporting goods store
format that averages 11,000 square feet. Big 5's product mix includes athletic
shoes, apparel and accessories, as well as a broad selection of outdoor and
athletic equipment for team sports, fitness, camping, hunting, fishing, tennis,
golf, snowboarding and in-line skating.
Big 5 Sporting Goods
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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. Forward-looking statements
involve known and unknown risks and uncertainties, which may cause Big 5's
actual results in future periods to differ materially from forecasted results.
Those risks and uncertainties include, among other things, the competitive
environment in the sporting goods industry in general and in Big 5's specific
market areas, inflation, product availability and growth opportunities, seasonal
fluctuations, weather conditions, changes in costs of goods sold, changes in
interest rates and economic conditions in general. Those and other risks are
more fully described in Big 5's filings with the Securities and Exchange
Commission, including the Annual Report on Form 10-K filed on March 12, 2004.
Big 5 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.
# # #
FINANCIAL TABLES FOLLOW
BIG 5 SPORTING GOODS
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT EARNINGS PER SHARE DATA)
As Reported Pro Forma
13 Weeks Ended 13 Weeks Ended(1)
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June 27, 2004 June 29, 2003 June 27, 2004
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Net sales $ 184,487 $ 170,125 $ 184,487
Cost of goods sold, buying and occupancy 116,806 107,530 116,806
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Gross profit 67,681 62,595 67,681
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Selling and administrative 50,035 46,521 50,035
Depreciation and amortization 2,711 2,527 2,711
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Operating income 14,935 13,547 14,935
Premium and unamortized financing fees
related to redemption of debt 792 -- --
Interest expense, net 1,638 2,922 1,638
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Income before income taxes 12,505 10,625 13,297
Income taxes 5,001 4,357 5,318
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Net income available to common stockholders $ 7,504 $ 6,268 $ 7,979
=========== =========== ==========
Earnings per share:
Basic $ 0.33 $ 0.28 $ 0.35
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Diluted $ 0.33 $ 0.28 $ 0.35
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Shares used to calculate earnings per share:
Basic 22,668 22,664 22,668
Diluted 22,794 22,730 22,794
BIG 5 SPORTING GOODS
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT EARNINGS PER SHARE DATA)
As Reported Pro Forma
26 Weeks Ended 26 Weeks Ended (1)
----------------------------- -----------------------------
June 27, 2004 June 29, 2003 June 27, 2004 June 29, 2003
------------- ------------- ------------- -------------
Net sales $365,492 $334,642 $365,492 $334,642
Cost of goods sold, buying and occupancy 232,172 214,195 232,172 214,195
-------- -------- -------- --------
Gross profit 133,320 120,447 133,320 120,447
-------- -------- -------- --------
Selling and administrative 99,615 91,643 99,615 91,643
Depreciation and amortization 5,502 5,043 5,502 5,043
-------- -------- -------- --------
Operating income 28,203 23,761 28,203 23,761
Premium and unamortized financing fees
related to redemption of debt 792 1,483 -- --
Interest expense, net 3,574 5,896 3,574 5,896
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Income before income taxes 23,837 16,382 24,629 17,865
Income taxes 9,534 6,717 9,851 7,325
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Net income $ 14,303 $ 9,665 $ 14,778 $ 10,540
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Earnings per share:
Basic $ 0.63 $ 0.43 $ 0.65 $ 0.47
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Diluted $ 0.63 $ 0.43 $ 0.65 $ 0.46
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Shares used to calculate earnings per share:
Basic 22,666 22,637 22,666 22,637
Diluted 22,792 22,691 22,792 22,691
BIG 5 SPORTING GOODS
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(1) The above pro forma statements are based upon the company's unaudited
consolidated financial statements, with certain adjustments. This
presentation is not in accordance with, or an alternative for, generally
accepted accounting principles (GAAP) and may not be consistent with the
presentation used by other companies. However, Big 5 uses this pro forma
reporting internally to evaluate its operating performance without regard
to certain financial effects of the 2004 second quarter and 2003 first
quarter partial senior note redemptions and believes this presentation
will provide investors with additional insight into its operating results.
The following table reconciles the pro forma data to that reported in the
financial statements by making certain adjustments for the 2004 and 2003
partial senior note redemptions.
26 Weeks Ended
(in thousands except earnings per share data) 13 Weeks Ended -------------------------------
June 27, 2004 June 27, 2004 June 27, 2003
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Reported net income $ 7,504 $ 14,303 $ 9,665
Premium and unamortized financing fees
related to redemption of debt (a) 792 792 1,483
Income taxes (b) (317) (317) (608)
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Pro forma net income $ 7,979 $ 14,778 $ 10,540
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Pro forma earnings per share - diluted $ 0.35 $ 0.65 $ 0.46
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Pro forma weighted average shares outstanding - diluted 22,794 22,792 22,691
(a) To eliminate the premium and unamortized financing fees associated with
the 2004 and 2003 partial redemptions of senior notes.
(b) To reflect tax benefit for item (a) noted above at the company's effective
tax rate.
BIG 5 SPORTING GOODS
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(IN THOUSANDS)
June 27, December 28,
2004 2003
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Assets
Current assets
Cash $ 6,435 $ 9,030
Merchandise inventory 199,383 179,555
Other current assets 9,852 16,539
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Total current assets 215,670 205,124
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Property and equipment, net 45,665 46,952
Other long-term assets 18,568 19,949
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Total assets $279,903 $272,025
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Liabilities and Stockholders' Equity
Accounts payable $ 73,204 $ 76,004
Other current liabilities 41,246 54,717
Deferred rent 11,613 11,654
Long-term debt 109,517 99,686
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Total liabilities 235,580 242,061
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Net stockholders' equity 44,323 29,964
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Total liabilities and stockholders' equity $279,903 $272,025
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