Estimated read time: 2-3 minutes
This archived news story is available only for your personal, non-commercial use. Information in the story may be outdated or superseded by additional information. Reading or replaying the story in its archived form does not constitute a republication of the story.
NEW YORK (AP) — More bad news for sporting goods retailers: Hibbett, a chain with more than 1,000 stores, said it expects a key sales figure to fall due to a "challenging" retail environment.
Hibbett's stock plummeted more than 33 percent Monday. Shares of its competitors, such as Foot Locker and Dick's Sporting Goods, also fell.
Many traditional retailers have been hurt as more people chose to shop online, including those that sell sneakers, athletic clothing and other gear. Sports Authority went out of business last year, closing all its 460 stores after filing for bankruptcy protection. And one major sneaker maker, Nike Inc., announced last month that it is looking to sidestep traditional stores and sell more of its goods directly to customers online.
Hibbett has totally missed out on the move to online shopping. The company, which was founded more than 70 years ago, didn't launch an e-commerce website until Monday. It was especially hurt in December when other retailers were offering holiday-related online discounts during what is known as "cyber week." The company saw a "dramatic drop" in revenue during the month and fewer people visited its stores, CEO Jeff Rosenthal said in a March conference call.
Analysts at Stifel said they were glad Hibbett was finally selling goods online for of the back-to-school shopping season. "We expect e-commerce will be an immediate benefit to revenue," the analysts said in a note Monday.
But Hibbett, based in Birmingham, Alabama, said Monday that it expects sales to fall 10 percent at its established stores during the May-to-July period. That's far worse than the 1.9 percent drop that Wall Street analysts had expected, according to FactSet. Hibbett also said it expects to report a second-quarter loss between 19 cents per share and 22 cents per share. Analysts expected the company to post earnings of 15 cents per share for the quarter.
Shares of Hibbett Sports Inc. fell $6.60 to $13.10 on Monday. Foot Locker Inc. shares fell 4.6 percent, Dick's Sporting Goods Inc. fell 5.5 percent and The Finish Line Inc. dropped 6.5 percent.
Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.