ATLANTA — With consolidated same-store sales down 3.7 percent in the second quarter, Dick’s Sporting Goods reported a 16.5 fall in second quarter net income to $41.1 million, or 35 cents per diluted share, from $47.9 million, or 41 cents per diluted share a year ago.
Excluding the impact of costs related to the integration of Golf Galaxy, which Dick’s acquired in 2007, net income for the quarter, which ended Aug. 2, was $45.5 million, or 39 cents per share. Guidance provided by Dick’s on May 22 projected earnings between 34 and 38 cents per diluted share.
Net sales increased 7 percent to $1.086 billion from $1.013 billion in the year ago quarter, which Dick’s attributed to the opening of new stores, the inclusion of Chick’s Sporting Stores in this year’s results and the decrease in comparable store sales. Same store sales decreased 3.7 percent in Dick’s Sporting Goods Stores and fell 4.5 percent in Golf Galaxy stores. Chick’s, acquired on Nov. 30, 2007, is excluded from the comparable store sales calculation.
Dick’s said it expects to integrate Golf Galaxy’s operations by the end of this fiscal year. Costs related to the integration are expected to be approximately $11.3 million. Of that amount, $5.5 million was incurred in the second quarter, and Dick’s estimates $2.5 million and $3.3 million will be incurred in the third and fourth quarters of 2008, respectively.
The retailer opened nine Dick’s Sporting Goods stores and one Golf Galaxy store in the second quarter.
For the full year, Dick’s anticipates reporting consolidated earnings per share of approximately $1.27 to $1.36, excluding costs from the Golf Galaxy integration, or between $1.20 and $1.29 including the integration costs. Earnings for the full year 2007 were $1.33 per diluted share.