PITTSBURGH, Aug. 19, 2014 /PRNewswire/ -- DICK'S Sporting Goods, Inc. (NYSE: DKS), the largest U.S. based full-line omni-channel sporting goods retailer, today reported sales and earnings results for the second quarter ended August 2, 2014.

Second Quarter Results

The Company reported consolidated non-GAAP net income for the second quarter ended August 2, 2014 of $81.7 million, or $0.67 per diluted share, excluding golf restructuring charges, compared to the Company's expectations provided on May 20, 2014 of $0.62 to 0.67 per diluted share. For the second quarter ended August 3, 2013, the Company reported consolidated non-GAAP net income of $88.9 million, or $0.71 per diluted share, excluding an asset impairment charge.

On a GAAP basis, the Company reported consolidated net income for the second quarter ended August 2, 2014 of $69.5 million, or $0.57 per diluted share. For the second quarter ended August 3, 2013, the Company reported consolidated net income of $84.2 million, or $0.67 per diluted share. The GAAP to non-GAAP reconciliations are included in a table later in the release under the heading "Non-GAAP Net Income and Earnings Per Share Reconciliations."

Net sales for the second quarter of 2014 increased 10.3% to approximately $1.7 billion. Consolidated same store sales increased 3.2%, compared to the Company's guidance of an approximate 1 to 3% increase. Same store sales for DICK'S Sporting Goods increased 4.1%, while Golf Galaxy decreased 9.3%. Second quarter 2013 consolidated same store sales decreased 0.4%, adjusted for the shifted retail calendar due to the 53(rd) week in 2012.

"Our second quarter results came in at the high end of our expectations," said Edward W. Stack, Chairman and CEO. "As anticipated, the golf and hunting businesses continued to experience negative comps. However, excluding these two categories, the remainder of the business delivered a 7.8% same store sales increase. We saw significant strength in several areas, including categories that have received more space within our stores, such as women's and youth athletic apparel."

Mr. Stack continued, "The headwinds in our hunting business continued in the second quarter. However, as we look at the entirety of our outdoor business, strength in other outdoor categories offset the declines in hunting, and our total outdoor comps were flat for the quarter. This gives us confidence and enthusiasm for the outdoor business as we continue to grow our Field & Stream and DICK'S stores."

Golf Restructuring

In the second quarter, the Company recorded pre-tax charges totaling $20.4 million related to the restructuring of its golf business. These actions were taken to align the cost structure with current and expected trends in golf.

The pre-tax charges include:


    --  A $14.3 million non-cash impairment of trademarks and store assets used
        in the Company's golf business;
    --  Severance charges totaling $3.7 million relating to the elimination of
        specific golf positions from the DICK'S stores, and from the combination
        of DICK'S golf and Golf Galaxy corporate and administrative functions;
        and,
    --  A $2.4 million write-down of golf-related inventory.

Mr. Stack concluded, "We have consolidated our Golf Galaxy merchandising, marketing and store operations into DICK'S Sporting Goods. In addition, we have eliminated specific staff in our golf area within our DICK'S Sporting Goods stores. These changes are necessitated by the current and expected trends in golf. We will invest these cost savings into other aspects of our store operations and into the growth areas of our business."

Omni-channel Development

eCommerce penetration for the second quarter of 2014 was 6.3% of total sales, compared to 5.6% in the second quarter last year.

In the second quarter, the Company opened eight new DICK'S Sporting Goods stores and one new Field & Stream store. These stores are listed in a table later in the release under the heading "Store Count and Square Footage." The Company also relocated three DICK'S Sporting Goods stores during the second quarter. As of August 2, 2014, the Company operated 574 DICK'S Sporting Goods stores in 46 states, with approximately 30.9 million square feet and 79 Golf Galaxy stores in 29 states, with approximately 1.4 million square feet.

Balance Sheet

The Company ended the second quarter of 2014 with $100 million in cash and cash equivalents and no outstanding borrowings under its revolving credit facility. This compares to cash and cash equivalents of approximately $135 million and no outstanding borrowings under its $500 million revolving credit facility at the end of the second quarter of 2013. Over the course of the past twelve months, the Company utilized capital to invest in omni-channel growth, including Field & Stream stores, and returned over $360 million to shareholders through share repurchases and quarterly dividends.

Total inventory was 11.2% higher at the end of the second quarter of 2014 as compared to the end of the second quarter of 2013. Approximately 2% of inventory growth reflects inventory to support Field & Stream, including the seven new stores scheduled to open in the third quarter.

Year-to-Date Results

The Company reported consolidated non-GAAP net income for the 26 weeks ended August 2, 2014 of $143.0 million, or $1.17 per diluted share. For the 26 weeks ended August 3, 2013, the Company reported consolidated non-GAAP net income of $149.4 million, or $1.19 per diluted share.

On a GAAP basis, the Company reported consolidated net income for the 26 weeks ended August 2, 2014 of $139.5 million, or $1.14 per diluted share. For the 26 weeks ended August 3, 2013, on a GAAP basis, the Company reported consolidated net income of $149.0 million, or $1.18 per diluted share. The GAAP to non-GAAP reconciliations are included in a table later in the release under the heading "Non-GAAP Net Income and Earnings Per Share Reconciliations."

Net sales for the 26 weeks ended August 2, 2014 increased 9.2% from last year's period to $3.1 billion due to the opening of new stores coupled with a consolidated same store sales increase of 2.4%.

Capital Allocation

In the second quarter of 2014, the Company repurchased approximately 2.2 million shares of its common stock at an average cost of $44.51 per share, for a total cost of $100.0 million. To date, the Company has repurchased $380.6 million of common stock under its $1 billion share repurchase authorization.

On August 14, 2014, the Company's Board of Directors authorized and declared a quarterly dividend in the amount of $0.125 per share on the Company's Common Stock and Class B Common Stock. The dividend is payable in cash on September 26, 2014 to stockholders of record at the close of business on September 5, 2014.

Current 2014 Outlook

The Company's current outlook for 2014 is based on current expectations and includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as described later in this release. Although the Company believes that the expectations and other comments reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations or comments will prove to be correct.

For the second half of 2014, the Company is cautiously optimistic although it does expect, due to the cautious consumer, an increase in promotional activity with margins and advertising expense continuing to be under pressure and impacting earnings per diluted share by approximately $0.04.


    --  Full Year 2014
        --  Based on an estimated 122 million diluted shares outstanding, the
            Company currently anticipates reporting consolidated non-GAAP
            earnings per diluted share of approximately $2.70 to 2.85, excluding
            a gain on the sale of an asset and golf restructuring charges. For
            the 52 weeks ended February 1, 2014, the Company reported
            consolidated earnings per diluted share of $2.69.
        --  Consolidated same store sales are currently expected to increase
            approximately 1 to 3%, compared to a 1.9% increase in fiscal 2013.
        --  The Company now expects to open approximately 46 new DICK'S Sporting
            Goods stores, relocate five DICK'S Sporting Goods stores and remodel
            five DICK'S Sporting Goods stores in 2014. The Company also expects
            to open approximately eight new Field & Stream stores, relocate two
            Golf Galaxy stores and open one new Golf Galaxy store in 2014.

    --  Third Quarter 2014
        --  Based on an estimated 121 million diluted shares outstanding, the
            Company currently anticipates reporting consolidated earnings per
            diluted share of approximately $0.38 to 0.42 in the third quarter of
            2014, compared to consolidated earnings per diluted share of $0.40
            in the third quarter of 2013.
        --  Consolidated same store sales are currently expected to increase
            approximately 1 to 3% in the third quarter of 2014, as compared to a
            3.3% increase in the third quarter of 2013, adjusted for the shifted
            retail calendar due to the 53(rd) week in 2012.
        --  The Company expects to open approximately 24 new DICK'S Sporting
            Goods stores, relocate one DICK's Sporting Goods store and remodel
            five DICK's Sporting Goods stores in the third quarter of 2014. The
            Company also expects to open seven new Field & Stream stores and one
            new Golf Galaxy store, and relocate one Golf Galaxy store in the
            third quarter of 2014.

    --  Capital Expenditures
        --  In 2014, the Company now anticipates capital expenditures to be
            approximately $340 million on a gross basis and approximately $245
            million on a net basis.

Conference Call Info

The Company will host a conference call today at 10:00 a.m. Eastern Time to discuss the second quarter results. Investors will have the opportunity to listen to the earnings conference call over the internet through the Company's website located at www.DICKS.com/Investors. To listen to the live call, please go to the website at least fifteen minutes early to register and download and install any necessary audio software.

In addition to the webcast, the call can be accessed by dialing (877) 443-5743 (domestic callers) or (412) 902-6617 (international callers) and requesting the "DICK'S Sporting Goods Earnings Call."

For those who cannot listen to the live webcast, it will be archived on the Company's website for approximately 30 days. In addition, a dial-in replay of the call will be available. To listen to the replay, investors should dial (877) 344-7529 (domestic callers) or (412) 317-0088 (international callers) and enter confirmation code 10049787. The dial-in replay will be available for approximately 30 days following the live call.

Forward-Looking Statements Involving Known and Unknown Risks and Uncertainties

Except for historical information contained herein, the statements in this release or otherwise made by our management in connection with the subject matter of this release are forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) and involve risks and uncertainties and are subject to change based on various important factors, many of which may be beyond our control. Our future performance and financial results may differ materially from those included in any such forward-looking statements and such forward-looking statements should not be relied upon by investors as a prediction of actual results. You can identify these statements as those that may predict, forecast, indicate or imply future results, performance or advancements and by forward-looking words such as "believe", "anticipate", "expect", "estimate", "predict", "intend", "plan", "project", "goal", "will", "will be", "will continue", "will result", "could", "may", "might" or other words with similar meanings. Forward-looking statements include statements regarding, among other things, the Company's expectations for the continuation of negative trends and challenges in the golf business and the hunting business, the Company's confidence in the outdoor business, the investment of cost savings as a result of the restructuring of the Company's golf business, the Company's expectation for a cautious consumer and increased promotional activity, the Company's future performance, growth in the omni-channel network, number of new store openings and capital expenditures.

The following factors, among others, in some cases have affected and in the future could affect our financial performance and actual results, and could cause actual results for fiscal 2014 and beyond to differ materially from those expressed or implied in any forward-looking statements included in this release or otherwise made by our management: economic and financial uncertainties may cause a decline in consumer spending; intense competition in the sporting goods industry; changes in consumer demand or shopping patterns; limitations on the availability of attractive store locations and/or lease terms; unauthorized disclosure of sensitive or confidential customer information; risks relating to our private brand offerings; disruptions with our eCommerce services provider or of our information systems; access to adequate capital; changing laws and regulations affecting our business including the regulation of consumer products; factors affecting our vendors; litigation risks; foreign trade issues and currency exchange rate fluctuations; the loss of our key executives, especially Edward W. Stack, our Chairman and Chief Executive Officer; protection of our intellectual property; ability to attract and retain qualified business leaders; disruption at our distribution centers; developments with sports leagues, professional athletes or sports superstars; weather and seasonality of our business; risks associated with strategic investments or acquisitions; risks associated with being a controlled company; our anti-takeover provisions; our current intention to issue quarterly cash dividends; and our share repurchase activity, if any.

Known and unknown risks and uncertainties are more fully described in the Company's Annual Report on Form 10-K for the year ended February 1, 2014 as filed with the Securities and Exchange Commission ("SEC") on March 28, 2014 and in other reports filed with the SEC. In addition, we operate in a highly competitive and rapidly changing environment; therefore, new risk factors can arise, and it is not possible for management to predict or assess the impact of all such risk factors. Forward-looking statements included in this release are made as of the date of this release. We do not assume any obligation and do not intend to update any forward-looking statements, whether as a result of new information, future developments or otherwise, except as may be required by the securities laws.

About DICK'S Sporting Goods, Inc.

Founded in 1948, DICK'S Sporting Goods, Inc. is a leading omni-channel sporting goods retailer offering an extensive assortment of authentic, high-quality sports equipment, apparel, footwear and accessories. As of August 2, 2014, the Company operated 574 DICK'S Sporting Goods locations across the United States, serving and inspiring athletes and outdoor enthusiasts to achieve their personal best through a blend of dedicated associates, in-store services and unique specialty shop-in-shops dedicated to Team Sports, Athletic Apparel, Golf, Lodge/Outdoor, Fitness and Footwear.

Headquartered in Pittsburgh, PA, DICK'S also owns and operates Golf Galaxy, Field & Stream and True Runner specialty stores. DICK'S offers its products through a content-rich eCommerce platform that is integrated with its store network and provides customers with the convenience and expertise of a 24-hour storefront. DICK'S Sporting Goods, Inc. news releases are available at www.DICKS.com/Investors. The Company's website is not part of this release.

Contacts:

Anne-Marie Megela, Vice President - Treasury Services and Investor Relations, or
Scott W. McKinney, Director of Investor Relations
DICK'S Sporting Goods, Inc.
investors@dcsg.com
(724) 273-3400




                                                 DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES

                                                 CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

                                                     (In thousands, except per share data)


                                                                                            13 Weeks Ended
                                                                                            --------------

                                                          August 2,                     % of                August 3,     % of
                                                                2014                    Sales                     2013
                                                                                                                       Sales (1)
                                                                                                                       --------


    Net sales                                                           $1,688,890                             100.00%                     $1,531,431            100.00%

    Cost of goods sold, including occupancy and            1,186,334                                  70.24              1,052,101                         68.70
      distribution costs



    GROSS PROFIT                                             502,556                                  29.76                479,330                         31.30


    Selling, general and administrative expenses             383,054                                  22.68                336,950                         22.00

    Pre-opening expenses                                       7,940                                   0.47                  5,285                          0.35
                                                               -----                                   ----                  -----                          ----


    INCOME FROM OPERATIONS                                   111,562                                   6.61                137,095                          8.95


    Interest expense                                             763                                   0.05                    716                          0.05

    Other income                                             (2,013)                                (0.12)               (1,735)                       (0.11)
                                                              ------                                  -----                 ------                         -----


    INCOME BEFORE INCOME TAXES                               112,812                                   6.68                138,114                          9.02


    Provision for income taxes                                43,345                                   2.57                 53,951                          3.52
                                                              ------                                   ----                 ------                          ----


    NET INCOME                                                             $69,467                               4.11%                        $84,163              5.50%
                                                                           =======                                ====                         =======               ====


    EARNINGS PER COMMON SHARE:

    Basic                                                                    $0.58                                                              $0.68

    Diluted                                                                  $0.57                                                              $0.67


    WEIGHTED AVERAGE COMMON SHARES
      OUTSTANDING:

    Basic                                                    119,950                                                               122,901

    Diluted                                                  121,840                                                               125,593


    Cash dividend declared per share                                        $0.125                                                             $0.125


    (1) Column does not add due to rounding



                                                 DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES

                                                 CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

                                                     (In thousands, except per share data)


                                                                                            26 Weeks Ended
                                                                                            --------------

                                                          August 2,                     % of                August 3,     % of
                                                                2014                                              2013
                                                                                       Sales                           Sales (1)
                                                                                       -----                           --------


    Net sales                                                           $3,127,798                             100.00%                     $2,865,132            100.00%

    Cost of goods sold, including occupancy and            2,184,359                                  69.84              1,974,149                         68.90
      distribution costs



    GROSS PROFIT                                             943,439                                  30.16                890,983                         31.10


    Selling, general and administrative expenses             705,643                                  22.56                649,658                         22.67

    Pre-opening expenses                                      14,146                                   0.45                  6,614                          0.23
                                                              ------                                   ----                  -----                          ----


    INCOME FROM OPERATIONS                                   223,650                                   7.15                234,711                          8.19


    Interest expense                                           1,372                                   0.04                  1,385                          0.05

    Other income                                             (4,377)                                (0.14)               (7,940)                       (0.28)
                                                              ------                                  -----                 ------                         -----


    INCOME BEFORE INCOME TAXES                               226,655                                   7.25                241,266                          8.42


    Provision for income taxes                                87,205                                   2.79                 92,282                          3.22
                                                              ------                                   ----                 ------                          ----


    NET INCOME                                                            $139,450                               4.46%                       $148,984              5.20%
                                                                          ========                                ====                        ========               ====


    EARNINGS PER COMMON SHARE:

    Basic                                                                    $1.16                                                              $1.21

    Diluted                                                                  $1.14                                                              $1.18


    WEIGHTED AVERAGE COMMON SHARES
      OUTSTANDING:

    Basic                                                    120,544                                                               122,802

    Diluted                                                  122,600                                                               125,728


    Cash dividends declared per share                                       $0.250                                                             $0.250


    (1) Column does not add due to rounding




                                                                    DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES

                                                                       CONSOLIDATED BALANCE SHEETS - UNAUDITED

                                                                               (Dollars in thousands)


                                                                                               August 2,                August 3,       February 1,
                                                                                                     2014                        2013         2014
                                                                                                     ----                        ----         ----

    ASSETS

    CURRENT ASSETS:

    Cash and cash equivalents                                                                                  $100,132                    $134,765              $181,731

    Accounts receivable, net                                                                      102,248                        84,956                 60,779

    Income taxes receivable                                                                         6,328                         2,455                  7,275

    Inventories, net                                                                            1,418,660                     1,275,215              1,232,065

    Prepaid expenses and other current assets                                                      90,369                       109,146                 99,386

    Deferred income taxes                                                                          39,423                        46,138                 38,835
                                                                                                   ------                        ------                 ------

    Total current assets                                                                        1,757,160                     1,652,675              1,620,071
                                                                                                ---------                     ---------              ---------


    Property and equipment, net                                                                 1,138,182                       937,310              1,084,529

    Intangible assets, net                                                                         84,901                        97,858                 98,255

    Goodwill                                                                                      200,594                       200,594                200,594

    Other assets:

    Deferred income taxes                                                                           3,169                         4,114                  2,477

    Other                                                                                          71,477                       126,920                 65,561
                                                                                                   ------                       -------                 ------

    Total other assets                                                                             74,646                       131,034                 68,038
                                                                                                   ------                       -------                 ------

    TOTAL ASSETS                                                                                             $3,255,483                  $3,019,471            $3,071,487
                                                                                                             ==========                  ==========            ==========


    LIABILITIES AND STOCKHOLDERS' EQUITY

    CURRENT LIABILITIES:

    Accounts payable                                                                                           $688,442                    $598,263              $562,439

    Accrued expenses                                                                              305,937                       295,010                265,040

    Deferred revenue and other liabilities                                                        125,258                       111,101                154,384

    Income taxes payable                                                                           12,784                        12,777                 19,825

    Current portion of other long-term debt and leasing obligations                                   461                         8,300                    899

    Total current liabilities                                                                   1,132,882                     1,025,451              1,002,587
                                                                                                ---------                     ---------              ---------

    LONG-TERM LIABILITIES:

    Other long-term debt and leasing obligations                                                    6,232                         6,360                  6,476

    Deferred income taxes                                                                          18,473                         8,449                 38,617

    Deferred revenue and other liabilities                                                        401,021                       314,756                331,628
                                                                                                  -------                       -------                -------

    Total long-term liabilities                                                                   425,726                       329,565                376,721
                                                                                                  -------                       -------                -------

    COMMITMENTS AND CONTINGENCIES

    STOCKHOLDERS' EQUITY:

    Common stock                                                                                      941                           981                    961

    Class B common stock                                                                              249                           249                    249

    Additional paid-in capital                                                                    979,696                       913,580                958,943

    Retained earnings                                                                           1,296,434                     1,030,108              1,187,514

    Accumulated other comprehensive income                                                             40                            81                     24

    Treasury stock, at cost                                                                     (580,485)                    (280,544)              (455,512)
                                                                                                 --------                      --------               --------

    Total stockholders' equity                                                                  1,696,875                     1,664,455              1,692,179
                                                                                                ---------                     ---------              ---------

    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                               $3,255,483                  $3,019,471            $3,071,487
                                                                                                             ==========                  ==========            ==========



                                                                                       DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES

                                                                                     CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED

                                                                                                  (Dollars in thousands)


                                                                                                                                                    26 Weeks Ended
                                                                                                                                                    --------------

                                                                                                                                       August 2,             August 3,
                                                                                                                                             2014                  2013
                                                                                                                                             ----                  ----

    CASH FLOWS FROM OPERATING ACTIVITIES:

    Net income                                                                                                                                    $139,450                         $148,984

    Adjustments to reconcile net income to net cash provided by operating activities

    Depreciation and amortization                                                                                                          89,771                           76,314

    Deferred income taxes                                                                                                                (21,424)                        (14,545)

    Stock-based compensation                                                                                                               12,915                           13,925

    Excess tax benefit from exercise of stock options                                                                                     (6,588)                        (15,475)

    Tax benefit from exercise of stock options                                                                                                 22                              102

    Gain on sale of asset                                                                                                                (14,428)                               -

    Other non-cash items                                                                                                                      290                              290

    Changes in assets and liabilities:

    Accounts receivable                                                                                                                  (11,023)                        (21,690)

    Inventories                                                                                                                         (186,595)                       (179,029)

    Prepaid expenses and other assets                                                                                                    (10,980)                        (12,738)

    Accounts payable                                                                                                                      133,245                           83,458

    Accrued expenses                                                                                                                        7,697                         (15,561)

    Income taxes payable / receivable                                                                                                         494                         (27,212)

    Deferred construction allowances                                                                                                       44,934                           12,756

    Deferred revenue and other liabilities                                                                                               (25,561)                        (44,173)
                                                                                                                                          -------                          -------

    Net cash provided by operating activities                                                                                             152,219                            5,406
                                                                                                                                          -------                            -----

    CASH FLOWS FROM INVESTING ACTIVITIES:

    Capital expenditures                                                                                                                (150,382)                        (95,479)

    Proceeds from sale of other assets                                                                                                     73,392                           11,000

    Deposits and purchases of other assets                                                                                                   (79)                        (48,469)
                                                                                                                                              ---                          -------

    Net cash used in investing activities                                                                                                (77,069)                       (132,948)
                                                                                                                                          -------                         --------

    CASH FLOWS FROM FINANCING ACTIVITIES:

    Payments on other long-term debt and leasing obligations                                                                                (682)                         (1,615)

    Construction allowance receipts                                                                                                             -                               -

    Proceeds from exercise of stock options                                                                                                 8,879                           22,736

    Excess tax benefit from exercise of stock options                                                                                       6,588                           15,475

    Minimum tax withholding requirements                                                                                                  (7,645)                        (12,877)

    Cash paid for treasury stock                                                                                                        (124,999)                        (80,603)

    Cash dividends paid to stockholders                                                                                                  (31,664)                        (33,550)

    (Decrease) increase in bank overdraft                                                                                                 (7,242)                           7,558
                                                                                                                                           ------                            -----

    Net cash used in financing activities                                                                                               (156,765)                        (82,876)
                                                                                                                                         --------                          -------

    EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS                                                                               16                             (31)
                                                                                                                                              ---                              ---

    NET DECREASE IN CASH AND CASH EQUIVALENTS                                                                                            (81,599)                       (210,449)

    CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                                                                        181,731                          345,214
                                                                                                                                          -------                          -------

    CASH AND CASH EQUIVALENTS, END OF PERIOD                                                                                                      $100,132                         $134,765
                                                                                                                                                  ========                         ========

Store Count and Square Footage

The stores that opened during the second quarter of 2014 are as follows:



    Store                    Market        Concept
    -----                    ------        -------

    Pleasant Hill, CA        San Francisco DICK'S Sporting Goods

    Culpeper, VA             Culpeper      DICK'S Sporting Goods

    Arden, NC                Asheville     DICK'S Sporting Goods

    Lawrence, KS             Lawrence      DICK'S Sporting Goods

    Chicago (South Loop), IL Chicago       DICK'S Sporting Goods

    Seabrook, NH             Portsmouth    DICK'S Sporting Goods

    Clermont, FL             Orlando       DICK'S Sporting Goods

    South San Antonio, TX    San Antonio   DICK'S Sporting Goods

    Erie, PA                 Erie          Field & Stream

The following represents a reconciliation of beginning and ending stores and square footage for the periods indicated:

Store Count:



                       Fiscal 2014                      Fiscal 2013
                       -----------                      -----------

               DICK'S            Golf Galaxy     Total  DICK'S      Golf Galaxy
                                       /                                  /         Total
              Sporting            Specialty            Sporting      Specialty
                                    Store                              Store
               Goods               Concepts              Goods        Concepts
                                      (1)                                (1)
                 -----            ---------                -----      ---------

    Beginning
     stores        558                        84              642               518        83 601

    Q1 New
     stores          8                         -               8                 2         -  2

    Q2 New
     stores          8                         1                9                 7         -  7

    Ending
     stores        574                        85              659               527        83 610
                   ===                       ===              ===               ===       === ===


    Relocated
     stores          4                         1                5                 -        -  -




    Square Footage:

    (in millions)


                    DICK'S   Golf Galaxy
                                   /         Total (2)
                    Sporting  Specialty
                                Store
                     Goods     Concepts
                                  (1)
                       -----  ---------

    Q1 2013             28.3             1.4           29.7

    Q2 2013             28.7             1.4           30.0

    Q3 2013             29.9             1.5           31.4

    Q4 2013             30.1             1.5           31.6
    -------             ----             ---           ----

    Q1 2014             30.6             1.5           32.1

    Q2 2014             30.9             1.6           32.5



    (1)             Includes the Company's Field
                    & Stream and True Runner
                    stores.

    (2)             Column may not add due to
                    rounding.

Non-GAAP Financial Measures

In addition to reporting the Company's financial results in accordance with generally accepted accounting principles ("GAAP"), the Company provides information regarding net income and earnings per diluted share adjusted for certain non-recurring, infrequent or unusual items; earnings before interest, taxes and depreciation, adjusted to exclude certain non-recurring, infrequent or unusual items ("adjusted EBITDA"), and a reconciliation from the Company's gross capital expenditures, net of tenant allowances. These measures are considered non-GAAP and are not preferable to GAAP financial information; however, the Company believes this information provides additional measures of performance that the Company's management, analysts and investors can use to compare core operating results between reporting periods. These non-GAAP measures are provided below and on the Company's website at www.DICKS.com/Investors.




    Non-GAAP Net Income and Earnings Per Share Reconciliations:

    (in thousands, except per share data):


                                                                                     Fiscal 2014

                                                                            13 Weeks Ended August 2, 2014
                                                                            -----------------------------


                                                                As Reported                   Golf                 Non-GAAP
                                                                                         Restructuring               Total
                                                                                            Charges
                                                                                            -------

    Net sales                                                               $1,688,890                                      $       -                  $1,688,890

    Cost of goods sold, including occupancy and                   1,186,334                                (2,405)                    1,183,929
      distribution costs



    GROSS PROFIT                                                    502,556                                  2,405                       504,961


    Selling, general and administrative expenses                    383,054                               (17,960)                      365,094

    Pre-opening expenses                                              7,940                                      -                        7,940
                                                                      -----                                    ---                        -----


    INCOME FROM OPERATIONS                                          111,562                                 20,365                       131,927


    Interest expense                                                    763                                      -                          763

    Other income                                                    (2,013)                                     -                      (2,013)
                                                                     ------                                    ---                       ------


    INCOME BEFORE INCOME TAXES                                      112,812                                 20,365                       133,177


    Provision for income taxes                                       43,345                                  8,146                        51,491
                                                                     ------                                  -----                        ------


    NET INCOME                                                                 $69,467                                        $12,219                      $81,686
                                                                               =======                                        =======                      =======


    EARNINGS PER COMMON SHARE:

    Basic                                                                        $0.58                                                           $0.68

    Diluted                                                                      $0.57                                                           $0.67


    WEIGHTED AVERAGE COMMON SHARES
      OUTSTANDING:

    Basic                                                           119,950                                                             119,950

    Diluted                                                         121,840                                                             121,840

During the second quarter of 2014, the Company recorded pre-tax restructuring charges of $20.4 million including a $14.3 million non-cash impairment of trademarks and store assets, severance charges of $3.7 million resulting from the elimination of specific staff in the golf area of its DICK'S stores and consolidation of DICK'S golf and Golf Galaxy corporate and administrative functions, and a $2.4 million write-down of excess golf inventories. The provision for income taxes was calculated at 40%, which approximates the Company's blended tax rate.


                                                                    Fiscal 2014

                                                           26 Weeks Ended August 2, 2014
                                                           -----------------------------


                                    As                Gain on Sale of                    Golf                   Non-GAAP
                                 Reported                  Asset                    Restructuring                 Total
                                                                                        Charges
                                                                                        -------

    Net sales                              $3,127,798                                            $        -              $         -         $3,127,798

    Cost of goods sold,
     including                   2,184,359                                       -                          (2,405)        2,181,954
      occupancy and distribution
       costs



    GROSS PROFIT                   943,439                                       -                            2,405           945,844


    Selling, general and
     administrative                705,643                                  14,428                          (17,960)          702,111
      expenses

    Pre-opening expenses            14,146                                       -                                -           14,146
                                    ------                                     ---                              ---           ------


    INCOME FROM OPERATIONS         223,650                                (14,428)                           20,365           229,587


    Interest expense                 1,372                                       -                                -            1,372

    Other income                   (4,377)                                      -                                -          (4,377)
                                    ------                                     ---                              ---           ------


    INCOME BEFORE INCOME           226,655                                (14,428)                           20,365           232,592
      TAXES


    Provision for income taxes      87,205                                 (5,771)                            8,146            89,580
                                    ------                                  ------                             -----            ------


    NET INCOME                               $139,450                                              $(8,657)                  $12,219            $143,012
                                             ========                                               =======                   =======            ========


    EARNINGS PER COMMON
      SHARE:

    Basic                                       $1.16                                                                                  $1.19

    Diluted                                     $1.14                                                                                  $1.17


    WEIGHTED AVERAGE COMMON
      SHARES OUTSTANDING:

    Basic                          120,544                                                                                   120,544

    Diluted                        122,600                                                                                   122,600

During the first quarter of 2014, the Company recorded a pre-tax $14.4 million gain on sale of a corporate aircraft. During the second quarter of 2014, the Company recorded pre-tax restructuring charges of $20.4 million including a $14.3 million non-cash impairment of trademarks and store assets, severance charges of $3.7 million resulting from the elimination of specific staff in the golf area of its DICK'S stores and consolidation of DICK'S golf and Golf Galaxy corporate and administrative functions, and a $2.4 million write-down of excess golf inventories. The provision for income taxes for the aforementioned adjustments were calculated at 40%, which approximates the Company's blended tax rate.


                                                                            Fiscal 2013

                                                                   13 Weeks Ended August 3, 2013
                                                                   -----------------------------


                                                 As Reported                            Asset            Non-GAAP
                                                                                      Impairment           Total
                                                                                        Charge
                                                                                        ------

    Net sales                                                $1,531,431                                           $      -                  $1,531,431

    Cost of goods sold, including occupancy and    1,052,101                                           -                   1,052,101
      distribution costs



    GROSS PROFIT                                     479,330                                           -                     479,330


    Selling, general and administrative expenses     336,950                                     (7,881)                     329,069

    Pre-opening expenses                               5,285                                           -                       5,285
                                                       -----                                         ---                       -----


    INCOME FROM OPERATIONS                           137,095                                       7,881                      144,976


    Interest expense                                     716                                           -                         716

    Other income                                     (1,735)                                          -                     (1,735)
                                                      ------                                         ---                      ------


    INCOME BEFORE INCOME TAXES                       138,114                                       7,881                      145,995


    Provision for income taxes                        53,951                                       3,152                       57,103
                                                      ------                                       -----                       ------


    NET INCOME                                                  $84,163                                             $4,729                      $88,892
                                                                =======                                             ======                      =======


    EARNINGS PER COMMON SHARE:

    Basic                                                         $0.68                                                               $0.72

    Diluted                                                       $0.67                                                               $0.71


    WEIGHTED AVERAGE COMMON SHARES
      OUTSTANDING:

    Basic                                            122,901                                                                 122,901

    Diluted                                          125,593                                                                 125,593

During the second quarter of 2013, the Company recorded a pre-tax $7.9 million non-cash impairment charge to reduce the carrying value of a corporate aircraft held for sale to fair market value. The provision for income taxes was calculated at 40%, which approximates the Company's blended tax rate.




                                                                        Fiscal 2013

                                                               26 Weeks Ended August 3, 2013
                                                               -----------------------------


                                        As Reported               Recovery of                   Asset                 Non-GAAP
                                                                  Previously                 Impairment                 Total
                                                                Impaired Asset                 Charge
                                                                --------------                 ------

    Net sales                                       $2,865,132                                         $        -              $         -        $2,865,132

    Cost of goods sold, including         1,974,149                                       -                             -        1,974,149
      occupancy and distribution costs



    GROSS PROFIT                            890,983                                       -                             -          890,983


    Selling, general and administrative     649,658                                       -                       (7,881)          641,777
      expenses

    Pre-opening expenses                      6,614                                       -                             -            6,614
                                              -----                                     ---                           ---            -----


    INCOME FROM OPERATIONS                  234,711                                       -                         7,881           242,592


    Interest expense                          1,385                                       -                             -            1,385

    Other income                            (7,940)                                  4,342                              -          (3,598)
                                             ------                                   -----                            ---           ------


    INCOME BEFORE INCOME                    241,266                                 (4,342)                         7,881           244,805
      TAXES


    Provision for income taxes               92,282                                       -                         3,152            95,434
                                             ------                                     ---                         -----            ------


    NET INCOME                                        $148,984                                           $(4,342)                   $4,729           $149,371
                                                      ========                                            =======                    ======           ========


    EARNINGS PER COMMON
      SHARE:

    Basic                                                $1.21                                                                              $1.22

    Diluted                                              $1.18                                                                              $1.19


    WEIGHTED AVERAGE COMMON
      SHARES OUTSTANDING:

    Basic                                   122,802                                                                                122,802

    Diluted                                 125,728                                                                                125,728

During the first quarter of 2013, the Company determined that it would recover $4.3 million of its investment in JJB Sports, which it had previously fully impaired. There is no related tax expense as the Company reversed a portion of the deferred tax valuation allowance it had previously recorded for net capital loss carryforwards it did not expect to realize at the time its investment in JJB Sports was fully impaired. During the second quarter of 2013, the Company recorded a pre-tax $7.9 million non-cash impairment charge to reduce the carrying value of a corporate aircraft held for sale to fair market value. The provision for income taxes was calculated at 40%, which approximates the Company's blended tax rate.

Adjusted EBITDA

Adjusted EBITDA should not be considered as an alternative to net income or any other generally accepted accounting principles measure of performance or liquidity. Adjusted EBITDA, as the Company has calculated it, may not be comparable to similarly titled measures reported by other companies. Adjusted EBITDA is a key metric used by the Company that provides a measurement of profitability that eliminates the effect of changes resulting from financing decisions, tax regulations, capital investments and certain non-recurring, infrequent or unusual items.


                              13 Weeks Ended
                              --------------

                   August 2,                  August 3,
                         2014                        2013
                         ----                        ----

                          (dollars in thousands)

    Net income                     $69,467                          $84,163

    Provision for
     income taxes      43,345                               53,951

    Interest
     expense              763                                  716

    Depreciation
     and
     amortization      52,912                               43,506
                                                           ------

    EBITDA                        $166,487                         $182,336
                                  ========                         ========

    Add: Golf
     restructuring
     charges            6,043                                    -

    Adjusted
     EBITDA, as
     defined                      $172,530                         $182,336
                                  ========                         ========


    % decrease in
     adjusted
     EBITDA              (5)%



                            26 Weeks Ended

                   August 2,                  August 3,
                         2014                        2013
                         ----                        ----

                        (dollars in thousands)

    Net income                    $139,450                         $148,984

    Provision for
     income taxes      87,205                               92,282

    Interest
     expense            1,372                                1,385

    Depreciation
     and
     amortization      89,771                               76,314

    EBITDA                        $317,798                         $318,965
                                  ========                         ========

    Less:
     Recovery of
     previously
     impaired
     asset                  -                             (4,342)

    Less: Gain on
     sale of
     asset           (14,428)                                   -

    Add: Golf
     restructuring
     charges            6,043                                    -
                        -----                                  ---

    Adjusted
     EBITDA, as
     defined                      $309,413                         $314,623
                                  ========                         ========


    % decrease in
     adjusted
     EBITDA              (2)%

Reconciliation of Gross Capital Expenditures to Net Capital Expenditures

The following table represents a reconciliation of the Company's gross capital expenditures to its capital expenditures, net of tenant allowances.


                                       26 Weeks Ended
                                       --------------

                        August 2,                August 3,
                              2014                     2013
                              ----                     ----

                                   (dollars in thousands)

    Gross capital
     expenditures                   $(150,382)                     $(95,479)

    Proceeds from sale-
     leaseback
     transactions                -                              -

    Deferred
     construction
     allowances             44,934                          12,756

    Construction
     allowance receipts          -                              -
                               ---                            ---

    Net capital
     expenditures                   $(105,448)                     $(82,723)
                                     =========                       ========

SOURCE DICK'S Sporting Goods, Inc.