BIRMINGHAM, Ala. - Hibbett, Inc. (NASDAQ:HIBB), a leading athletic-inspired fashion retailer, today announced financial results for the first quarter ended May 4, 2024.
The company reported a slight earnings beat with a first-quarter EPS of $2.67, surpassing the analyst estimate of $2.63. However, revenue for the quarter was down, coming in at $447.17 million, which did not meet the consensus estimate of $454.56 million and represented a 1.8% decline from the previous year's $455.5 million.
President and CEO Mike Longo commented on the results, "Our sales and diluted earnings per share for the first quarter of Fiscal 2025 were in line with our expectations in a very challenging athletic footwear and apparel retail market."
Longo highlighted the company's execution of its long-term strategy and its focus on serving underserved communities. He also expressed enthusiasm for the company's upcoming acquisition by JD (NASDAQ:JD) Sports, which he believes will reinforce the strength of Hibbett's brands.
Comparable sales for the first quarter decreased by 5.8% YoY, with both brick and mortar and e-commerce sales experiencing a decline. Gross margin, however, improved to 35.8% of net sales, up from 33.7% in the prior year, primarily due to a lower promotional and clearance environment. Store operating, selling, and administrative expenses rose to 23.7% of net sales, up from 21.1% last year, largely due to inflation and lower sales volume.
Net income for the quarter was $32.5 million, or $2.67 per diluted share, down from $35.9 million, or $2.74 per diluted share, in the same quarter last year. The company ended the quarter with the same number of stores as the previous quarter, at 1,169.
Inventory levels saw a 15.2% decrease compared to the prior-year first quarter, reflecting a tighter inventory management strategy. Hibbett did not repurchase shares during the quarter and has suspended its Stock Repurchase Program and future dividend payments in anticipation of the merger with JD Sports.
The transaction with JD Sports is expected to close in the second half of 2024, subject to customary closing conditions, including regulatory approvals and Hibbett stockholder approval. Following the completion of the transaction, Hibbett will become a privately held subsidiary of JD Sports and will no longer be publicly traded.
The company's financial health remains stable, with $28.7 million in cash and cash equivalents and a modest debt level on its unsecured line of credit.
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