Hibbett Sports (HIBB) recorded a 34% increase in its second-quarter profit amid stronger sales and the opening of new stores.
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But the sporting goods retailer added to a chorus of concern in the industry over consumer spending, lowering its full-year outlook to per-share earnings of $2.65 to $2.77. The company previously expected earnings of $2.85 to $3.05 a share, while analysts most recently projected $2.94.
Hibbett also lowered its estimate for same-store sales growth to an increase in the low single-digits versus a prior view of the low to mid single-digits.
Shares tumbled 8.9% to $53.25 in mid-morning trading Friday. As of Thursday’s close, the stock was up 11% on the year.
The company is the latest in a long list of retailers that have dimmed their guidance due to economic concerns. Rival Dick’s Sporting Goods (DKS) said earlier this week it expects consumers to remain “relatively cautious,” and retailers Wal-Mart (WMT) and Target (TGT) echoed similar sentiments when they reported earnings this month.
“We delivered a solid increase in earnings for the second quarter. Comparable store sales were softer than planned due to a challenging economic environment,” Hibbett’s President and Chief Executive Jeff Rosenthal said in a statement. “However, we are encouraged by a strong start to the third quarter.”
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Rosenthal pointed to the strong performance of new stores. Hibbett opened 17 new locations in the latest period and closed four underperforming ones, bringing its store count to 892 in 31 states. For fiscal 2014, the company plans to open between 70 and 75 stores, expand 18 and close 15 to 20.
Hibbett, which focuses on smaller markets with less competition, has seen its profits improve the last three years. The company operates stores primarily in the South, Southwest, mid-Atlantic and Midwest.
In the latest quarter, Hibbett logged a profit of $10.5 million versus a year-ago profit of $7.9 million. On a per-share basis, earnings rose to 40 cents from 30 cents. The results came in slightly ahead of Wall Street estimates of 39 cents.
Sales climbed 13% to $186.2 million, falling in-line with expectations. Same-store sales were up 0.3% on a calendar basis.
Gross margin widened to 34.3% from 34.2%, despite a 12% increase in input, distribution center and store occupancy costs.