Like other major retailers this quarter, Academy Sports and Outdoors reported lower first-quarter results than last year’s stimulus-fueled quarter.
First quarter net sales were $1.47 billion, down 7.1%, with comparable sales down 7.5%. Adjusted net earnings were $153.2 million with adjusted diluted earnings per share of $1.73 compared to $1.89 per share last year.
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Overall, supply chain delays and manufacturing slowdowns impacted the company’s merchandise and assortment in the first quarter. In apparel, for example, many spring shipments were delayed, pushing the execution of some spring apparel sets back nearly two months after their scheduled launch in early March.
Despite the industry-wide setbacks, Academy Sports expects the recovery and momentum to continue through the second quarter and the rest of the year as it opens more stores in more locations. ‘states. According to Academy merchandising director Steve Lawrence, the company ended the first quarter with a strong inventory position for summer and back-to-school products, showing signs of a rebound throughout the year.
Overall, first-quarter inventory rose 22% in dollar terms from 2021, to $1.3 billion, but was up only 8.8% from 2019, with units of inventory down 8% from 2019. Compared to 2019 results, the sporting goods retailer saw positive gains across major categories.
Academy shares were up more than 8% at market close on Tuesday.
Footwear was the company’s best-performing division in the quarter, with sales in the category down 2% year-over-year, but up 20% from 2019.
Improved inventory levels allowed the flow of products from key brands such as Nike, Adidas, Brooks, Skechers and Crocs.
“There’s always a lot of strength in the performance race,” Lawrence said in an interview with FN, pointing to a trend that goes against what similar retail companies have said about the abandonment of sports shoes in the first trimester. “The client is still up and running, and we’re seeing that on all the different platforms.”
Academy also saw strong sales in work shoes and in its cleats business, although the latter segment was affected by supply shortages and factory closures in Vietnam, where much of this product is manufactured.
“There weren’t enough cleats out there, especially baseball cleats, but also soccer cleats, in the supply chain and in the market,” Lawrence said. “Our stores are still half full [with cleats]. They are not what we would like them to be.
Despite supply challenges, which Academy expects to persist through the end of the year, the company has actually seen an increase in sales in this category. That’s because stores sold out cleats “literally as fast as they arrived” to help meet some of the demand, Lawrence said.
Meanwhile, the outdoor category — the company’s second-best performer — was down 6% from 2021, but up 52% from 2019. On a call with investors, Lawrence called “strong relationships with key partners such as Yeti, Igloo, Coleman and The North Face” as crucial to driving strong results in the segment.
Academy is the latest activewear retailer to post less-than-exciting first-quarter results. In May, Hibbett Sports said its first quarter results were affected by supply chain disruptions, the spread of COVID-19, lack of stimulus and unemployment benefits, rising inflation, wage pressures and geopolitical strife. Dick’s Sporting Goods also posted a weak outlook after reporting first quarter results that were impacted by wage and inflationary pressures as well as rising transportation costs.
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