Cabelaâ€™s (NYSE:CAB) said Thursday demand for firearms and ammunition weakened in the first three months of 2017, citing the election of President Donald Trump.
The Sidney, Neb.-based hunting and outdoors retailer, which is set to be acquired by rival Bass Pro Shops, reported a decline in first-quarter earnings and revenue as sales in its namesake Cabelaâ€™s stores continued to soften. U.S. comparable store sales dropped 9.1% compared to the same period last year. Cabelaâ€™s said several categories, including firearms, contributed to the decline.
Retailers and gun makers have said consumer demand stalled in the wake of President Trumpâ€™s ascension to the White House. Sales typically peak when lawmakers propose new gun-control measures. Last week, Trump became the first sitting president since Ronald Reagan to give a speech at the NRAâ€™s annual convention.
In addition to the impact of the election, higher gun sales that followed the 2015 terrorist attack in San Bernardino, Calif., created a tough year-over-year comparison, Cabelaâ€™s noted.
However, the National Shooting Sports Foundation said April sales activity picked up. The trade groupâ€™s adjusted data, which exclude background checks for permits and other non-sales transactions, showed a slight increase in April. The FBIâ€™s National Instant Criminal Background Check System processed a total of 2.05 million checks in April, a decline of 4.6%.
Cabelaâ€™s reported net income of $19.1 million, down 16.7% from $22.9 million in the year-ago quarter. On a per-share basis, earnings came in at 28 cents versus 33 cents last year. Adjusted earnings were 40 cents a share, besting Wall Streetâ€™s consensus estimate by two pennies.
Total revenue was down 3.4% at $834.9 million, which fell short of estimates.
In April, Cabelaâ€™s and Bass Pro revised their buyout agreement after regulatory delays at Capital One Financial (NYSE:COF), which was slated to take over Cabelaâ€™s financial unit, threatened to derail the deal.
Synovus Financial (NYSE:SNV), a bank based in Georgia, agreed to purchase the assets and deposits of Cabelaâ€™s Worldâ€™s Foremost Bank. Capital One will scoop up the retailerâ€™s credit card business. Cabelaâ€™s and Bass Pro also announced a smaller purchase price of $61.50 a share, setting a new deal value of $4.2 billion. Bass Pro initially agreed to buy Cabelaâ€™s for $65.50 a share.