Sportsman's Warehouse Profit Rises, Outlook Weak; Shares Tank 9%

(RTTNews) - Sportsman's Warehouse Holdings Inc. (SPWH), Thursday reported an increase in profit for the third quarter, as revenues and margins increased. However, shares of the sporting goods retailer slipped 9 percent in the after-hours trade after it detailed a poor outlook for the fourth quarter and lowered its full-year forecast.

The Midvale, Utah-based company's third-quarter profit rose to $8.92 million or $0.21 per share from $2.22 million or $0.07 per share last year. On average, seven analysts polled by Thomson Reuters estimate earnings of $0.20 per share for the quarter. Analysts' estimates typically exclude one-time items.

Net sales for the quarter grew 4.3 percent to $182.5 million from $175.1 million last year. Analysts had a consensus revenue estimate of $186.34 million for the quarter.

Same store sales decreased by 6.2 percent, primarily as a result of the decline in demand for firearms and ammunition. Gross margins for the quarter improved to 33.2 percent from 31.5 percent last year. The company opened one new store in the third quarter and ended the quarter with 55 stores, an increase of 17 percent from last year.

Chief Executive John Schaefer said, "Our third quarter earnings came in above our guidance range driven by solid results from our non-hunting and shooting product categories combined with positive new store performance and margin expansion."

Looking forward to the fourth quarter, the company expects adjusted earnings of $0.20 to $0.22 per share and sales of $185.0 million to $190.0 million. Analysts currently estimate earnings of $0.24 per share on revenues of $195.39 million for the quarter.

For the full year 2014, the company now expects adjusted earnings of $0.48 to $0.50 per share and sales of $660.0 million to $665.0 million. Analysts currently estimate earnings of $0.51 per share on revenues of $684.37 million for the year.

Earlier, the company expected adjusted earnings of $0.47 to $0.52 per share sales of $665.0 million to $675.0 million.

SPWH closed Thursday's trading at $7.69, down $0.41 or 5.06%, on the Nasdaq. The stock further dropped $0.69 or 8.97% in the after-hours trade.