Dick’s Sporting Goods, No. 59 in the Internet Retailer 2019 Top 1000, had an uptick in ecommerce sales for its fiscal first quarter ending May 4.
Ecommerce sales increased 15% and generated 13% of the sporting goods retailer’s total sales for the quarter, or $249.7 million, compared with 11% of its sales in the prior year’s first quarter. The retailer’s total sales reached $1.92 billion in the first quarter, up 0.6% year over year from $1.91 billion.
Gross profit in the first quarter was $563.8 million, which was roughly flat compared with the same period last year, said chief financial officer Lee Belitsky. However, profit was largely offset by higher shipping and fulfillment costs as a result of Dick’s ecommerce growth, Belitsky said. “While gross margin rate of our ecommerce business is lower than our stores, we continue to be very pleased with the overall profitability of this channel,” he said in an earnings call transcribed by Seeking Alpha.
In the first quarter, Dick’s opened one new Golf Galaxy store and closed two Dick’s Sporting Goods stores. But it is “on track” to open two new dedicated ecommerce fulfillment centers in the third quarter in New York and California, Dick’s president Lauren Hobart said in the earnings call.
Dick’s also worked to improve the functionality and performance of its website in the first quarter, Hobart said. “We launched a new search engine that has dramatically improved page load times for search results across both desktop and mobile,” she said.
The retailer also saw an uptick in online orders picked up in store, Hobart says, crediting this growth to improved site messaging, inventory availability and in-store execution of omnichannel. (Specific buy online pick up in store figures were not disclosed.)
“We made great progress in executing against our strategic priorities and investments as we remain focused on improving the in-store and online experience,” Hobart said. “As we continue to build the best omnichannel experience in sporting goods, we see significant opportunity to drive competitive advantage in the marketplace and strengthen our leadership position.”
In other ecommerce earnings news:
- Evine Live Inc., No. 169, reported its total sales declined 16.0% in its fiscal first quarter ending May 4 to $131.5 million. Its top-performing category in the quarter was watches, which declined 0.3% year over year, while subscription sales increased 23%, primarily in its beauty and wellness category, Evine says. Evine also plans to change the name of the Evine network back to ShopHQ, which was the name of the network in 2014. ShopHQ is easier to recognize for existing television retailing customers, said CEO Tim Peterman.
- Canada Goose, No. 201, reported its Q4 2018 revenue of C$156.2 million ($115.65 million). That’s the first time its sales were lower than projections since Canada Goose went public. CEO Dani Reiss said the expansion into China will be a key growth driver in the coming quarters. He told analysts on a conference call the brand’s entrance into the market was “very successful.” The retailer opened its first flagship store in Beijing last December and plans to open three additional locations in China.
- Capri Holdings Ltd. (No. 243), the parent company of Michael Kors, reported revenue of $6.00 billion for the current fiscal year, the company said in its fiscal fourth quarter earnings report. It also reported that same-store sales for the Michael Kors brand were flat. Same-store sales is expected to grow for the smaller Versace and Jimmy Choo brands.
The company formerly known as Michael Kors is reinventing itself as a house of luxury brands, after acquiring fashion labels Versace for $2.2 billion and Jimmy Choo for $1.2 billion, both in the past two years. Michael Kors has been cleaning up its U.S. operations after years of heavy discounting took a toll on the business. Executives have worked to clear inventory and restore the brand’s luster, but comparable sales slid 1% in the quarter on a constant currency basis, and the division’s revenue also declined. Management aims to more than double Versace’s sales to $2 billion annually and will increase the brand’s store count to 300 worldwide. - Abercrombie & Fitch Co.’s same-store sales rose 1% company-wide in the first quarter, trailing the 1.4% estimate of analysts, according to Consensus Metrix. Abercrombie’s California-themed Hollister brand, which targets teens, saw its sales growth taper and rose just 2%. The company did not breakout ecommerce figures.
Abercrombie & Fitch (No. 71) said it would close three more flagship stores—including its Soho Hollister store in New York City—which will bring the total of flagship closures to five since 2017, and more could be coming, the company said on a conference call. The namesake Abercrombie brand did show signs of rebounding: same-store sales grew 1.5% this quarter. Amid a deepening trade war, CEO Fran Horowitz said the company is reducing the amount of merchandise it gets from China. The company will source less than 20% of its products from the country this year, compared with 25% in fiscal 2018, she said on a call with investors.
Bloomberg contributed to this report.
Favorite