Aug 19, 2011
Hibbett bucks trend, upbeat on back to school
Aug 19, 2011
August 19 - Hibbett Sports Inc's quarterly profit topped expectations on strong demand for its sportswear and shoes and the retailer said positive sales trends continued into the crucial back-to-school season.
Hibbett is a retail chain offering assortment of footwear, apparel and equipment.
The company, which is known for its small friendly neighbourhood stores, said it was "well-positioned" for the back-to-school season, the second largest selling season behind the holiday sales period at the end of the year.
All this prompted Hibbett to raise its full-year earnings forecast to $1.90-$2.00 a share from its prior outlook of $1.80-$1.95. Analysts, on average, were expecting earnings of $1.97 a share, according to Thomson Reuters I/B/E/S.
The company's upbeat outlook comes after the largest publicly traded U.S. sporting goods retailer, Dicks Sporting Goods Inc forecast a disappointing third quarter, raising fears over a slowdown in sales growth.
Hibbett's outlook also contrasts the glum view taken by many retailers as U.S. consumer sentiment dropped to its lowest point in more than three decades in early August, with the possibility of a double-dip recession, high unemployment and stagnant wages playing on the minds of many Americans.
The sporting goods arena, however, has generally fared a little better than others in U.S. retail.
Hibbett sells sporting goods, apparel and footwear under several well-known labels like Nike, Adidas, Reebok and Under Armour and likes to offer its customers product expertise to help them choose items.
Targeting smaller markets with fewer competitors has also seen Hibbett consistently grow sales over the past five years, even when the U.S. was engulfed by its worst recession since 1929.
The company, which operates over 800 stores primarily small ones in strip centers and malls mainly in Southern, Mid-Atlantic and lower Midwest U.S., grew sales by 12 percent last year on strong demand for branded gear and running shoes.
Hibbett also renewed its $30 million loan facility with Regions Bank. The facility is effective from Aug 25 and runs through Aug 24, 2012, it said in a regulatory filing.
For the second quarter ended July 30, the company earned $5.9 million, or 21 cents a share, topping market expectations by 2 cents.
Sales rose 10 percent to $153.1 million, edging past market expectations of $152.1 million. Same-store sales rose 5.9 percent for the quarter.
The Birmingham, Alabama-based company's shares have gained more than a quarter this year to close at $32.97 on Thursday on Nasdaq.
(Reporting by Chris Jonathan Peters in Bangalore; Editing by Viraj Nair)
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