Academy Sports + Outdoors Reports Decline in Net Sales and Profitability in Q2 and YTD 2024

Academy Sports + Outdoors, Inc. reported its financial results for the second quarter and year-to-date periods ending August 3, 2024, revealing a decline in net sales and profitability compared to the same periods in the previous fiscal year.

For the thirteen weeks ended August 3, 2024, net sales totaled $1,548.98 million, a decrease of 2.2% from $1,583.08 million in the prior year. The gross margin for this period was $558.73 million, down from $563.45 million, while operating income fell to $190.09 million from $210.96 million. Net income also declined to $142.59 million, compared to $157.08 million in the same quarter last year. Earnings per share decreased to $1.99 from $2.06.

Year-to-date results showed a similar trend, with net sales of $2,913.20 million, down 1.8% from $2,966.69 million. Gross margin for the first half of the fiscal year was $1,014.52 million, a decrease from $1,030.56 million, and operating income dropped to $292.47 million from $337.16 million. Net income for the twenty-six weeks ended August 3, 2024, was $219.05 million, down from $251.05 million, with earnings per share falling to $3.00 from $3.28.

Comparable sales for the second quarter decreased by 6.4%, attributed to a 7.4% decline in transactions, although the average ticket increased by 0.5%. The sports and recreation merchandise division saw a 7.3% decrease in sales, while apparel decreased by 2.2%. Conversely, footwear and outdoor merchandise divisions experienced slight increases of 1.3% and 0.8%, respectively.

The company’s cash and cash equivalents as of August 3, 2024, were $324.57 million, a decrease from $347.92 million at the end of the previous quarter. Total current assets increased to $1,812.39 million from $1,644.90 million, while total liabilities rose to $2,921.96 million from $2,722.06 million.

Academy Sports + Outdoors continued its share repurchase program, buying back 1,809,856 shares for $97.90 million during the second quarter, with a total of 3,793,823 shares repurchased year-to-date for $220.33 million. The company declared a quarterly cash dividend of $0.11 per share, payable on October 17, 2024.

Strategically, the company has focused on enhancing its omnichannel capabilities, with e-commerce sales representing 9.7% of total sales in the second quarter, up from 9.4% in the prior year. The company also opened 14 new stores in 2023, contributing to net sales growth. However, increased inventory shrinkage and rising selling, general, and administrative (SG&A) expenses, which rose to 24.8% of net sales, have posed challenges to profitability.