Big 5 Sporting Goods Corporation (BGFV) Q4 2024 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call reveals significant financial challenges, including declining net sales, increased net losses, and negative EBITDA. Same-store sales continue to decline, and macroeconomic headwinds persist. The company plans store closures and lacks a share repurchase program. Management's refusal to provide specific revenue guidance adds uncertainty. Although there is optimism about growth and new products, these are insufficient to offset the negative factors. The market is likely to react strongly negatively to these developments.
Key Financial Performance
Net Sales Q4 2024 $181.6 million (down 7.6% year-over-year from $196.3 million) due to macroeconomic headwinds affecting consumer discretionary spending and unfavorable winter weather conditions.
Same-store Sales Q4 2024 Down 6.1% year-over-year, reflecting persistent challenges in consumer spending.
Gross Profit Q4 2024 $51.2 million (down from $59.2 million year-over-year) due to higher store occupancy and distribution expenses and lower merchandise margins.
Gross Profit Margin Q4 2024 28.2% (down from 30.2% year-over-year) primarily due to increased costs and lower merchandise margins.
Selling and Administrative Expense Q4 2024 $71.3 million (decreased by $1 million year-over-year) due to lower labor costs and an insurance settlement gain.
Selling and Administrative Expense as % of Net Sales Q4 2024 39.3% (up from 36.9% year-over-year) reflecting a lower sales base.
Net Loss Q4 2024 $20.9 million or $0.95 per basic share (compared to a net loss of $8.9 million or $0.41 per basic share in Q4 2023) due to a larger net loss and no tax benefit.
Adjusted EBITDA Q4 2024 Negative $16.4 million (compared to negative $8.7 million in Q4 2023) reflecting ongoing sales challenges.
Net Sales Fiscal 2024 $795.5 million (down 10.1% year-over-year from $884.7 million) due to decreased same-store sales.
Same-store Sales Fiscal 2024 Decreased 9.4% year-over-year, indicating a continued decline in consumer spending.
Net Loss Fiscal 2024 $69.1 million or $3.15 per basic share (compared to a net loss of $7.1 million or $0.33 per basic share in fiscal 2023) due to a non-cash charge for deferred tax assets.
Adjusted EBITDA Fiscal 2024 Negative $36.7 million (compared to positive $7.3 million in the prior year) reflecting significant operational challenges.
Merchandise Inventory Q4 2024 Decreased 5.6% year-over-year, reflecting efforts to align inventory levels with soft sales.
Capital Expenditures Fiscal 2024 $10.9 million, primarily for store remodeling and equipment, with expectations for $4 million to $8 million in fiscal 2025.
Net Cash Used in Operating Activities Fiscal 2024 $11.4 million (compared to $18.5 million provided in the prior year) due to a larger net loss.
Credit Facility Q4 2024 $150 million credit agreement with $13.8 million borrowed, providing financial flexibility.
Operating Highlights
Inventory Management: Inventory decreased 5.6% year-over-year, aligning levels with sales to enhance productivity and flexibility.
Store Closures: Anticipating closure of 15 stores in fiscal 2025, including 8 already closed in Q1, to focus on productive locations.
Capital Expenditures: CapEx for fiscal 2024 was $10.9 million, with expectations of $4 million to $8 million for fiscal 2025, primarily for store remodeling.
Strategic Focus: Emphasis on managing merchandise margins, expenses, and inventory levels to drive growth amid economic challenges.
Risk or Challenges
Sales Performance: Net sales for Q4 2024 were $181.6 million, down from $196.3 million in the prior year, with same-store sales down 6.1%. This decline reflects ongoing macroeconomic headwinds affecting consumer discretionary spending.
Weather Impact: Unfavorable winter weather conditions, particularly drought-like conditions in southern stores, negatively impacted winter-related product sales.
Inventory Management: Inventory decreased by 5.6% year-over-year, indicating efforts to align inventory levels with soft sales, but also reflects challenges in consumer spending.
Store Closures: The company plans to close 15 stores in fiscal 2025, including eight already closed in Q1, to focus resources on more productive locations.
Economic Challenges: Sales trends remain challenged as macroeconomic conditions affecting consumer discretionary spending have not improved, with expectations of continued declines in same-store sales.
Net Loss: Net loss for Q4 2024 was $20.9 million, compared to a net loss of $8.9 million in Q4 2023, indicating worsening financial performance.
Credit Agreement: Amended and extended a $150 million credit agreement, providing financial flexibility amid ongoing market challenges.
Future Guidance: For Q1 2025, same-store sales are expected to decline in the mid to high single-digit range, reflecting continued macroeconomic headwinds.
Guidance & Outlook
Store Closures: Anticipate closing 15 stores in fiscal 2025, including eight locations already closed in the first quarter.
Inventory Management: Ended the quarter with inventory down 5.6% year-over-year, aligning inventory levels with sales.
Capital Allocation: Reallocate capital and inventory to best performing locations to drive cost efficiencies.
Net Sales Guidance: Expect same-store sales to decline in the mid to high single-digit range for Q1 fiscal 2025.
Net Loss Guidance: Expect fiscal 2025 Q1 net loss per basic share in the range of $0.75 to $0.85.
CapEx Guidance: Expect CapEx for fiscal 2025 in the range of $4 million to $8 million, primarily for store-related remodeling.
Shareholder Return Plan
Share Repurchase Program: None
Key Q&A
Earnings Word Cloud
BGFV Transcript
The earnings call reveals concerning financial performance with declining net sales, increased net loss, and negative EBITDA. Store closures and increased inventory pose additional risks, while macroeconomic pressures and weather challenges further strain the outlook. The lack of a share repurchase program and unclear guidance in the Q&A add to the negative sentiment. Although there is optimism about new product launches, the overall negative financial indicators and lack of specific guidance suggest a likely negative stock price movement.
The earnings call reveals several negative factors: declining net sales and same-store sales, increased net loss, negative cash flow, and no share repurchase program. Management's unclear responses in the Q&A further suggest uncertainty. Although there are attempts to manage inventory and tariffs, the overall sentiment remains negative due to macroeconomic pressures and unfavorable weather impacting sales. The lack of positive catalysts, such as partnerships or improved guidance, supports a negative outlook for the stock price in the short term.
The earnings call reveals significant financial challenges, including declining net sales, increased net losses, and negative EBITDA. Same-store sales continue to decline, and macroeconomic headwinds persist. The company plans store closures and lacks a share repurchase program. Management's refusal to provide specific revenue guidance adds uncertainty. Although there is optimism about growth and new products, these are insufficient to offset the negative factors. The market is likely to react strongly negatively to these developments.
The company's earnings call reveals several negative factors: declining net sales, increased net loss, and reduced gross profit margins, driven by economic headwinds and inflationary pressures. Despite inventory management efforts, the lack of a share repurchase program and dividend suspension further dampen sentiment. While the Q&A section did not highlight significant management issues, the overall financial picture is concerning. The guidance suggests continued losses, and store closures may impact future sales. These factors collectively point to a negative stock price reaction over the next two weeks.
BGFV Report
Frequently Asked Questions
Where does this earnings call transcript come from?
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
How soon is the transcript available after the earnings call ends?
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
Is the transcript edited or altered in any way?
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
Why do some answers appear as “Unclear” or “Inaudible”?
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
