Big 5 Sporting Goods Q1 2025 Earnings Report

Big 5 Sporting Goods EPS Results

• Actual EPS: -$0.78
• Consensus EPS: -$0.80
• Beat/Miss: Beat by +$0.02
• One Year Ago EPS: N/A

Big 5 Sporting Goods Revenue Results

• Actual Revenue: $175.65 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Big 5 Sporting Goods Announcement Details

• Quarter: Q1 2025
• Date: 4/29/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, April 29, 2025
• Conference Call Time: 5:00PM ET

Big 5 Sporting Goods (NASDAQ:BGFV), Inc. (NASDAQ: BGFV) is a specialty retailer of sporting goods, athletic apparel and footwear in the United States. Founded in 1955 and headquartered in El Segundo, California, the company operates a chain of retail stores designed to serve a broad range of sports enthusiasts, from casual exercisers to competitive athletes. Its product assortment spans basketball, baseball, football, cycling, camping, fishing and water sports, as well as fitness equipment and lifestyle apparel.

The company’s retail network includes over 400 stores located primarily in the western United States. These brick-and-mortar outlets are complemented by an e-commerce platform that offers online ordering, curbside pickup and home delivery options. Big 5’s merchandising strategy emphasizes value pricing, national and private-label brands, and seasonal promotions to attract both cost-conscious shoppers and brand-loyal customers.

Throughout its history, Big 5 Sporting Goods has focused on community engagement and grassroots marketing, often partnering with youth sports organizations and local teams. The company expanded gradually from its California roots into neighboring states such as Arizona, Colorado, Nevada, Oregon, Utah and Washington, establishing a regional footprint that leverages supply-chain efficiencies and localized inventory management.

Leadership at Big 5 includes President and Chief Executive Officer Steven G. Miller, who joined the company in 2008 and was named CEO in 2011. Under his tenure, the company has modernized store layouts, enhanced its digital presence and refined its private-label offerings. Big 5’s board and management team continue to pursue a multichannel growth strategy aimed at strengthening its market position within the competitive sporting goods retail sector.

Big 5 Sporting Goods Q1 2025 Earnings Call Transcript

Key Takeaways

• In Q1 fiscal 2025, net sales were $175.6 million, down 9.2% year-over-year, with same-store sales falling 7.8% amid significant weather headwinds.
• Same-store sales in March were flat year-over-year, marking a meaningful recovery from earlier double-digit declines and benefiting by ~300 bps from an Easter calendar shift.
• Inventory ended Q1 up 6.5% year-over-year due to earlier seasonal receipts, which has mitigated near-term tariff impacts and positions the company for the key summer season.
• The company reported a net loss of $17.3 million (−$0.78/share) in Q1 FY25 versus a $8.3 million loss last year, and EBITDA was negative $12.0 million.
• For Q2 FY25, same-store sales are expected to decline in the low- to mid-single-digit range and net loss per share is forecast at $0.75–$0.90, reflecting ongoing macroeconomic and holiday calendar headwinds.

Presentation

[Operator]

Good day, ladies and gentlemen. Welcome to the Big 5 Sporting Goods First Quarter 2025 Earnings Results Conference Call. Today's call is being recorded, and with us today are Mr. Steve Miller, President and Chief Executive Officer, and Mr. Barry Emerson, Chief Financial Officer of Big 5 Sporting Goods. At this time, for opening remarks and introductions, I'd like to turn the floor over to Mr. Miller. Thank you. You may begin.

[Steve Miller, President and CEO at Big 5 Sporting Goods Corporation]

Thank you, Operator. Good afternoon, everyone. Welcome to our 2025 First Quarter Conference Call. Today, we will review our financial results for the first quarter of fiscal 2025, as well as provide an outlook for the second quarter. I will now turn the call over to Barry to read our Safe Harbor Statement.

[Barry Emerson, CFO at Big 5 Sporting Goods Corporation]

Thanks, Steve. Except for statements of historical fact, any remarks that we may make about our future expectations, plans, and prospects constitute forward-looking statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results in current and future periods to differ materially from forecasted results. These risks and uncertainties include those more fully described in our annual reports on Form 10-K, our quarterly reports on Form 10-Q, and our other filings with the Securities and Exchange Commission. We undertake no obligation to revise or update any forward-looking statements that may be made from time to time by us or on our behalf. Please refer to our press release to find a reconciliation of certain non-GAAP financial measures referenced in today's call.

[Steve Miller, President and CEO at Big 5 Sporting Goods Corporation]

Thank you, Barry. We were able to deliver a first quarter top and bottom line performance that was consistent with our expectations despite pressures from macroeconomic and weather-related headwinds. Net sales for the first quarter were $175.6 million compared to $193.4 million in the prior year, with same-store sales down 7.8% compared to the first quarter of fiscal 2024. Our sales in January and February were particularly difficult as we fought against highly unfavorable seasonal weather comparisons, which resulted in winter-related sales that were down nearly 25%. Although we experienced pockets of more normal seasonal winter weather, the southern tier of our store footprint was especially challenged. That said, sales trending improved substantially in March as positive winter weather set in late in the season.

[Steve Miller, President and CEO at Big 5 Sporting Goods Corporation]

March same-store sales were flat versus the prior year, which included an approximate 300 basis point benefit associated with the Easter calendar shift as the holiday when our stores are closed moved into the second quarter this year versus being in the first quarter last year. This performance in March marked a significant improvement from the double-digit declines we experienced earlier in the quarter. Looking at our major merchandise categories on a same-store basis for the quarter, hard goods decreased 4.7%, apparel declined 8.7%, and footwear was down 11.8%. Apparel and footwear were the categories most impacted by the unfavorable weather comparisons. Our transactions for the period were down 5.3%, and our average sale was down 2.5%. For the first quarter, our merchandise margins decreased 78 basis points compared to the prior year, reflecting product mix shifts along with promotional efforts to drive sales to value-conscious consumers.

[Steve Miller, President and CEO at Big 5 Sporting Goods Corporation]

We ended the quarter with inventory up 6.5% year over year. This increase reflects earlier receipts of seasonal merchandise compared to last year. This timing difference has proved advantageous. Not only are we better prepared as we move through spring and enter the key summer selling period, we've also significantly mitigated the near-term impact from increased tariff costs, providing us valuable time to advance negotiations with our vendors. Although our inventory levels are currently higher than last year, we anticipate that they will normalize relative to last year as we move through summer and expect to be in a lower inventory position year over year at year-end. As part of our broader strategic initiatives, we continue to optimize our store portfolio to focus our resources on our most productive stores.

[Steve Miller, President and CEO at Big 5 Sporting Goods Corporation]

We closed eight stores in the first quarter of fiscal 2025 and anticipate closing approximately seven additional stores over the remainder of the year. Turning now to our second quarter, our quarter-to-date sales are down in the high single-digit range, in part reflecting an approximate negative 400 basis point impact from one less sales day in the period to date due to the Easter calendar shift. Notwithstanding the fluidity of the macroeconomic conditions, the key to our results this quarter will be capitalizing on sales opportunities around the higher volume periods surrounding Memorial Day, Father's Day, and the start of summer. We believe we are well prepared for this period with healthy inventory levels of key products, which we received in front of any tariff impact.

[Steve Miller, President and CEO at Big 5 Sporting Goods Corporation]

We are encouraged by the early reads of our summer seasonal categories that we've experienced on the occasions thus far when we've seen snippets of warm weather in our geographies. Before I close, I want to briefly touch on the broader tariff situation. As I mentioned, we brought in extra product in advance of the tariffs, which should minimize any tariff impacts in the near term. Looking further down the road, it is a fluid situation, and like all retailers, we will continue to closely monitor tariffs and their impact on the supply chain, consumer sentiment, and consequently, consumer discretionary spending. The overall environment is uncertain right now, but as matters progress, we will remain nimble and evolve as needed by adjusting our purchasing.

[Steve Miller, President and CEO at Big 5 Sporting Goods Corporation]

In the meantime, we are focused on the aspects of our business that we can best control to continue delivering value to our customers as we have throughout our long history. With that, I'll now turn it over to Barry to provide additional details regarding our first quarter performance and second quarter outlook.

[Barry Emerson, CFO at Big 5 Sporting Goods Corporation]

Thanks, Steve. Gross profit for the fiscal 2025 first quarter was $54.3 million compared to gross profit of $60.4 million in the first quarter of the prior year. Our gross profit margin of 30.9% in the 2025 first quarter compared to 31.2% in the first quarter last year. The slight decrease in gross profit margin versus the prior year primarily reflected higher store occupancy expense as a percentage of net sales and a decrease in merchandise margins of 78 basis points. Overall selling and administrative expense for the fiscal 2025 first quarter decreased $0.6 million compared to the prior year. The year-over-year reduction primarily reflected decreases in labor costs and reduced credit card fees related to lower sales. As a percent of net sales, selling and administrative expense was 40.3% in the 2025 first quarter versus 36.9% in the 2024 first quarter, reflecting the lower sales base.

[Barry Emerson, CFO at Big 5 Sporting Goods Corporation]

We continue to focus on managing the expenses within our control, considering the ongoing economic challenges. Now looking at our bottom line, net loss for the first quarter of fiscal 2025 was $17.3 million or $0.78 per basic share compared to a net loss of $8.3 million or $0.38 per basic share in the first quarter last year. Due to the valuation allowance related to deferred tax assets that we established in the third quarter of fiscal 2024, net loss for the first quarter of fiscal 2025 does not reflect an income tax benefit, which was recorded in the year-ago period. For ease of reference, our net loss for the first quarter of fiscal 2024 reflected an income tax benefit of $2.8 million. EBITDA was negative $12 million for the first quarter of fiscal 2025 compared to negative EBITDA of $6.5 million in the first quarter last year.

[Barry Emerson, CFO at Big 5 Sporting Goods Corporation]

Turning to the balance sheet, our merchandise inventory at the end of the first quarter of fiscal 2025 increased 6.5% year over year. The increase primarily reflects our earlier scheduling of spring and summer merchandise deliveries compared to last year when we experienced delays in receiving certain categories of product and missed sales opportunities. As Steve mentioned, we believe our inventory is well positioned to drive sales during the upcoming summer season. Reviewing our capital spending, our CapEx, excluding non-cash acquisitions, totaled $1.7 million for the first quarter of fiscal 2025, primarily reflecting store-related remodeling and distribution center investments. For the 2025 full year, we expect CapEx in the range of $4-$7 million, mainly representing investments in store-related remodeling. Now looking at our cash flow, net cash used in operating activities was $15.3 million in the first quarter of fiscal 2025.

[Barry Emerson, CFO at Big 5 Sporting Goods Corporation]

This compares to net cash provided by operating activities of $8.2 million last year. The decrease was primarily attributed to increased funding of merchandise inventory and a larger net loss in the current period. As of the end of our 2025 first quarter, we had $30.9 million of borrowings outstanding under our $150 million credit facility and a cash balance of $3.9 million. Now I'll spend a moment on guidance. For the fiscal 2025 second quarter, we expect same-store sales to be down in the low to mid-single-digit range compared to the 2024 second quarter. Our same-store sales guidance reflects an expectation that macroeconomic headwinds will continue through the second quarter.

[Barry Emerson, CFO at Big 5 Sporting Goods Corporation]

This guidance also reflects the combined negative impact of calendar shifts associated with the Easter holiday, during which the company stores are closed, from the first quarter of fiscal 2024 and into the second quarter of fiscal 2025, and with the 4th of July holiday, which will move one day further into the third quarter this year. Fiscal 2025 second quarter net loss per basic share is expected in the range of $0.75-$0.90, which reflects no tax benefit for the period, compared to fiscal 2024 second quarter net loss per basic share of $0.46, which reflected a tax benefit of $0.16 per basic share. That concludes our prepared remarks. I will now turn the call back to Steve for some closing comments.

[Steve Miller, President and CEO at Big 5 Sporting Goods Corporation]

Thank you, Barry. Thank you all for joining us in today's call. We appreciate your interest in Big 5 Sporting Goods and look forward to speaking with you again after the conclusion of our second quarter.

[Operator]

This concludes today's teleconference. You may disconnect your lines at this time. Thank you again for your participation.

Participants

Executives

• Steve Miller, President and CEO

Analysts

• Barry Emerson, CFO at Big 5 Sporting Goods Corporation