Shares for Boot Barn were down nearly 7 percent after the bell on Thursday as the footwear retailer warned it may continue to see a drop in same store sales.
Despite this news, the Irvine, Calif-based company reported a 6.5 percent increase in net sales to $374.5 million in the second quarter of fiscal 2024, up from $351.5 million in the prior-year period. Net income was $27.7 million, or $0.90 per diluted share, compared to $32.1 million, or $1.06 per diluted share in the prior-year period.
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According to Boot Barn, the overall increase in net sales was the result of the incremental sales from new stores opened over the past twelve months, partially offset by the decrease in consolidated same store sales.
But the news that may have sparked the stock movement Thursday evening came when Boot Barn noted that its same store sales have taken a hit in the quarter. In Q2, the company saw consolidated same store sales decrease 4.8 percent, retail store same store sales decline 3.8 percent and e-commerce same store sales drop 11.7 percent.
Jim Conroy, president and CEO of Boot Barn, said in a statement that this sequential decline in same store sales was driven by a “macro pull back” in consumer demand.
Overall, though, the CEO is optimistic for the company’s future, adding that Boot Barn’s inventory levels and expense structure are “well positioned” for the holiday season.
“I am pleased with our second quarter results which included solid sales growth, merchandise margin expansion and earnings achievement which was at the high end of our guidance range,” Conroy said. “We opened 10 new stores in the quarter and continue to be encouraged by the new store performance across the country. Exclusive brand penetration expanded more than 600 basis points as our brands are resonating well with the consumer. Our average store sales volume remains at elevated levels with a modest 3.8 percent decline in retail store same store sales for the quarter.”
Looking ahead, Boot Barn expects total sales for fiscal 2024 of $1.677 billion to $1.702 billion, representing growth of 1.2 percent to 2.7 percent over the prior year. But, same store sales are expected to decline by approximately 5.0 percent to 6.5 percent this year.
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