The Sports Authority Reports Third-Quarter Sales and Operating Income for 1994

Strategic Insights -

The Sports Authority Inc., a leading retailer of sports equipment and apparel, announced its third-quarter sales and operating income for 1994. Despite a significant increase in sales, the company's operating income remained break even for the quarter. However, when excluding pre-opening expenses, operating income was $4 million, or 2.1% of sales. The company's comparable store sales for the same period showed an increase of 4.2%, with 66 stores considered comparable. Adjusted for stores cannibalized by new store openings, the comparable store sales increase was 7.0%.

Key Takeaways:

  • The Sports Authority Inc. reported third-quarter sales of $195 million, a 37.3% increase from the same period in fiscal 1993.
  • Operating income for the period was break even, compared to income of $2 million in the same period in 1993.
  • Operating income decreased due to the opening of 11 new stores in the third quarter of 1994, resulting in an increase in pre-opening expense of $2.6 million.
  • Operating income before pre-opening expense was $4 million, or 2.1% of sales for the third quarter of 1994.
  • Comparable store sales for the same period were up 4.2%, with 14 stores cannibalized by new store openings.
  • The company's sales for the nine-month period ended October 23, 1994, were $570 million, an increase of 40.0% from the prior year.
  • Operating income for the nine-month period was $10 million, vs. $8 million in the same period in 1993.
  • The company operates 96 The Sports Authority stores in 22 states.

Statistics:

  • 37.3%: Increase in sales for the 13-week period ended October 23, 1994.
  • 4.2%: Increase in comparable store sales for the same period.
  • 7.0%: Adjusted comparable store sales increase, adjusted for stores cannibalized by new store openings.
  • $2.6 million: Increase in pre-opening expense due to the opening of 11 new stores in the third quarter of 1994.
  • 2.1%: Operating income as a percentage of sales for the third quarter of 1994.
  • 40.0%: Increase in sales for the 39-week period ended October 23, 1994.
  • 1.8%: Operating income as a percentage of sales for the nine-month period.
  • 8.2%: Adjusted comparable store sales increase, adjusted for cannibalized stores, for the nine-month period.

Sources:

  • Business Wire, November 14, 1994.