Dick’s Sporting Goods reported a bigger-than-expected drop in quarterly same-store sales and forecast further declines this year due to tighter controls on gun sales, sending its shares down 8 percent.
The company posted a 1.9 percent fall in same-store sales, bigger than the average estimate of a 0.62 percent drop, also blaming weak sales of Under Armour products at its stores.
Dick’s was one of the first retailers to stop selling assault rifles and high-capacity magazines as well as bar the sale of guns to people under age 21, following a massacre at a Florida high school in February.
The company had predicted that its hunting guns business would be pressurized due to the change in its gun sales policy but said the move also attracted more people to its stores.
Dick’s said it expects annual same-store to decline 3 percent to 4 percent, compared with a 0.3 percent decline in its 2017 fiscal year. Dick’s also said it expects earnings per share of in the range of $3.02 to $3.20 for the year ending February 2019.
Chief Executive Officer Edward Stack said Under Armour sales fell as a result of the sports apparel maker’s decision to expand distribution.
Under Armour shares were down 3 percent at $20.30 in premarket trading.
The company’s net income rose 6 percent to $119.40 million, or $1.20 per share. Analysts had estimated $1.06 per share.
Net sales inched up nearly 1 percent to $2.18 billion, below the average Wall Street estimate of $2.24 billion.
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