Dick’s Sporting Goods, Inc., a Pennsylvania-based sportswear and equipment retailer, has reported a significant decline in net sales for the first quarter of 2020. The company’s sales plummeted by 30.6%, totaling $1.33 billion compared to $1.92 billion in the same period last year. This decline can be mainly attributed to the disruptions caused by the Covid-19 pandemic.
The temporary closure of stores, which the company implemented on March 18 in response to the coronavirus crisis, had a profound impact on its consolidated same-store sales, dropping by 29.5%. However, Dick’s Sporting Goods did experience robust growth in its e-commerce sales, which surged by an impressive 110% during the quarter. Unfortunately, despite the surge in digital sales, it was unable to compensate for the declines caused by the temporary closures. Digital sales accounted for 39% of the company’s total revenues, which is a significant increase from 13% in the first quarter of 2019.
The retailer also suffered a quarterly net loss of $143.4 million, or $1.71 per diluted share, in comparison to a net income of $57.5 million, or $0.61 per diluted share, in the same period last year. The company’s bottom line was adversely affected by $62 million in pre-tax expenses, which included compensation and safety costs for employees, as well as inventory write-downs.
By May 30, Dick’s Sporting Goods had reopened approximately 80% of its 851 stores. The company’s president, Lauren R. Hobart, reported signs of recovery, stating that consolidated same-store sales had only declined by 4.0% in the first four weeks of the second quarter. This progressive recovery can be attributed to the reopening of stores and the strong sales momentum in the e-commerce sector, which has surged by over 250%.
Chairman and CEO Edward W. Stack expressed optimism about the future of the business, believing that health and fitness will become even more important to consumers after the current crisis. He also emphasized the company’s strong relationships with key brands and its ability to meet the demand in the sporting goods retail sector.
Due to the ongoing uncertainty surrounding the effects of the coronavirus pandemic, Dick’s Sporting Goods withdrew its financial guidance for fiscal 2020 on March 19. The company has not yet provided an updated outlook.
To learn more about Dick’s Sporting Goods’ financial situation, you can visit their official website [LINK]. Additionally, for more information on the impact of Covid-19 on the sporting goods industry, you can read this article [LINK].