CLOSE

Despite the bankruptcy of a key competitor and announced job cuts.
Time

Dick’s Sporting Goods warned Tuesday that sales are expected to fall despite its plans to increase discounts, compounding concerns over brick-and-mortar woes despite the big-box chain’s continued expansion.

Sales of hunting goods, licensed products and athletic apparel undermined Dick’s during the period, offsetting growth in footwear, golf and online sales.

The sporting goods sector’s largest retailer fell short of expectations for second-quarter sales, triggering a selloff in the company’s stock.

Sales at stores open at least a year were up only 0.1%, despite the company’s projected growth of 2% to 3%.

Dick’s shares plunged 16.9% to $29 in pre-marketing trading.

CEO Edward Stack said in a statement that Dick’s would “be more promotional and increase our marketing efforts for the remainder of the year, as we will aggressively protect our market share.”

As the company’s competitors struggle, Stack said “we continue to believe retail disruption creates opportunities for us as we look long-term.”

But investors seemed to be concerned that disruption could sweep through Dick’s, as well. 

Ominously, the company warned that third-quarter same-store sales would fall “in the low single-digits,” after having increased 5.2% in the third quarter of 2016.

For the full fiscal year, the retailer projected same-store sales of a “low single-digit decline” to flat.

On the whole, though, the company’s expansion continues to add to sales and earnings. The chain said it expects to open 43 new Dick’s locations, relocate seven Dick’s stores, open eight new Golf Galaxy locations, relocate one Golf Galaxy store and open eight new Field & Stream locations.

During the second quarter, overall sales rose 9.6% to $2.2 billion, lining up with S&P Global Market Intelligence expectations. Net income increased 5.2% to $112.4 million, narrowly edging S&P projections.

Follow USA TODAY reporter Nathan Bomey on Twitter @NathanBomey.

Read or Share this story: https://usat.ly/2x0BGD0