Cabela’s Inc. Announces Fourth Quarter and Full Year 2016 Results

Cabela’s Incorporated (NYSE:CAB) today reported financial results for the fourth quarter and fiscal year ended December 31, 2016. As previously disclosed, the Company’s fourth fiscal quarter and fiscal year ended December 31, 2016, included 13 weeks and 52 weeks, respectively, while its fourth fiscal quarter and fiscal year ended January 2, 2016, included 14 weeks and 53 weeks, respectively.

For the quarter, on a GAAP basis, total revenue decreased 4.9% to $1.3 billion, revenue from retail store sales decreased 4.3% to $888.2 million, Internet and catalog sales decreased 12.4% to $307.8 million, and Financial Services revenue increased 1.2% to $132.7 million. For the quarter, adjusted for the shift in weeks, U.S. comparable store sales decreased 6.4% and consolidated comparable store sales decreased 6.5%. Adjusted for the 53rd week in the fourth quarter of 2015, total revenue increased 1.0%, retail store sales increased 4.9%, and Internet and catalog sales decreased 4.7%. See the supporting schedules to this earnings release labeled “Revenue in Fiscal Year 2016 (52 Weeks) Compared to Fiscal Year 2015 (53 Weeks)” for a reconciliation of the GAAP to non-GAAP financial measures.

For the quarter, net income decreased 26.3% to $58.1 million compared to $78.8 million in the year ago quarter, and earnings per diluted share were $0.84 compared to $1.14 in the year ago quarter. Adjusted for certain items, the Company reported fourth quarter net income of $72.5 million and earnings per diluted share of $1.05 as compared to net income of $86.8 million and earnings per diluted share of $1.26 in the year ago quarter. Fourth quarter 2016 GAAP results included impairment and restructuring charges and other items totaling a $0.21 reduction in earnings per diluted share. See the supporting schedules to this earnings release labeled “Reconciliation of GAAP Reported to Non-GAAP Adjusted Financial Measures” for a reconciliation of the GAAP to non-GAAP financial measures.

For fiscal 2016, net income decreased 22.4% to $146.9 million compared to $189.3 million, and earnings per diluted share were $2.13 compared to $2.67 a year ago. Adjusted for certain items, the Company reported fiscal 2016 net income of $179.7 million and earnings per diluted share of $2.60 as compared to net income of $204.7 million and earnings per diluted share of $2.88 a year ago. Fiscal 2016 GAAP results included impairment and restructuring charges and other items totaling a $0.47 reduction in earnings per diluted share. See the supporting schedules to this earnings release labeled “Reconciliation of GAAP Reported to Non-GAAP Adjusted Financial Measures” for a reconciliation of the GAAP to non-GAAP financial measures.

“We were clearly disappointed with the fourth quarter results,” said Tommy Millner, Cabela’s Chief Executive Officer. “Consistent with other retailers, we experienced challenging traffic patterns in the quarter. Our increase in average ticket was not enough to make up for a decrease in transactions. Similar to industry trends, we experienced strength in firearms and shooting-related categories primarily early in the quarter. Later in the quarter, firearms and shooting-related categories became challenging as we faced the headwind of lapping the impact that the San Bernardino tragedy had on these categories a year ago. We saw improved trends in apparel and other softgoods categories in the latter part of the quarter. We continue to be pleased with the performance and growth of our Cabela’s CLUB Visa program.”

For the quarter, consolidated comparable store sales decreased 6.5% and U.S. comparable store sales decreased 6.4% as compared to the same quarter a year ago. Comparable store sales strength in firearms and shooting-related categories through the first half of the quarter was more than offset by softness in these categories due to challenging comparisons from the year ago period.

Merchandise gross margin decreased by 118 basis points in the quarter to 32.2% compared to 33.3% in the same quarter a year ago. This decrease was primarily attributable to the impacts of merchandise mix, promotional activity, and efforts to right size inventory levels. The negative impact of merchandise mix was attributable to the first two months of the quarter with increased firearms and shooting-related category penetration and decreased penetration in apparel categories. This negative impact was slightly offset in the month of December with lower penetration of firearms and shooting-related categories and higher penetration of apparel categories. The overall merchandise mix impact was approximately 70 basis points of the overall decrease for the quarter. Promotional activity was responsible for approximately 30 basis points of the decrease and efforts to right size inventory levels were responsible for approximately 20 basis points of the overall decrease.
more detail at:  http://phx.corporate-ir.net/phoenix.zhtml?c=177739&p=irol-newsArticle&ID=2246585

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