Academy Sports And Outdoors Q1 Earnings Miss Estimate On Macroeconomic Pressure

Academy Sports And Outdoors Inc ASO reported a first-quarter FY23 sales decline of 5.7% year-on-year to $1.38 billion, missing the analyst consensus estimate of $1.44 billion.

• Adjusted EPS of $1.30 missed the analyst consensus of $1.66.
• Comparable sales declined 7.3%.
• Gross margin contracted 170 basis points Y/Y to 33.8%, and gross profit fell 10.4% to $467.1 million.
• Operating margin was 9.1%, and operating income for the quarter plunged 38.6% to $126.2 million.
• The company held $295.5 million in cash and equivalents as of April 29, 2023. The operating cash flow for the quarter totaled $52.1 million.
• Adjusted EBITDA for the quarter totaled $167.5 million.
• "Although our first quarter sales and earnings did not meet our expectations and we have macroeconomic challenges to manage through, our revised guidance reflects our anticipation that sales will improve in the back half of the year,” said CFO Michael Mullican.
• Outlook: ASO lowered FY23 sales outlook to $6.175 billion - $6.365 billion (previous view $6.5 billion - $6.7 billion) versus the consensus of $6.59 billion.
• The company lowered its FY23 adjusted EPS outlook to $6.80 - $7.50 from the prior forecast of $7.00 - $7.75, against the consensus of $7.49.
• The company expects to open 13 to 15 new stores in 2023 and 120 to 140 over the next five years.

Price Action: ASO shares traded lower by 1.7% at $49.40 at the last check Tuesday.

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