Dick's Sporting Goods 2003 Annual Report Download - page 4

dks 03ar 2
dear fellow shareholders
This industry-leading performance provides a
strong endorsement of our 10,000+ associates,
and of our guiding principles, including financial
discipline and a focus on execution in everything
that we do.
A Different Kind of Sporting Goods Retailer
As I have outlined in the past, we are a very
different kind of sporting goods retailer. We sell
authentic equipment, apparel and footwear,
focusing on the core athlete and outdoor
enthusiast. Our in-store associates, like our
customers, are enthusiasts as well. As the second
largest employer of PGA pros in the country, you
can find in our Golf Pro Shops one of over 150 PGA
pros that we employ. We also employ 175 bike
technicians, and we’re excited about our initiative
to capitalize on the fitness business as we plan to
have certified fitness trainers in every store by the
end of 2004. Our emphasis on serving customers
with sports enthusiasts and specialists remains a
point of differentiation.
2003 Highlights
In 2003, a comparable store sales gain of 2.1%
and the opening of 22 new stores fueled a 16%
increase in sales. We entered 11 new markets with
13 stores, accompanied by nine stores in existing
markets. Our operating income improved 25% to
$86.3 million, or 5.9% of sales, up from 5.4% in
2002. Earnings per share grew 22% to $1.05 on a
post-split basis, compared to pro-forma earnings
per share in 2002 of $0.86.
I’m pleased to report that 2003 was another record
year for Dick’s Sporting Goods. In this, our first
full year as a public company, we again achieved
industry-leading results and reached several
new milestones.
Achievement
First and foremost, our shareholders were rewarded
with 162% growth in our share price in fiscal 2003,
and 315% from our IPO in October 2002 through
the end of fiscal 2003. As a result of this growth in
our stock price and the confidence of our Board of
Directors and management in both the strong
fundamentals and growth potential of our business,
we announced a two-for-one stock split, in the
form of a stock dividend, which became effective
on April 5, 2004.
We ended 2003 as the second largest full-line
sporting goods retailer in the country with $1.5 billion
in sales, operating 163 stores in 27 states. Our net
income increased 37% over last year’s pro-forma
net income to $52.8 million, which was on top of
a 59% increase in the prior year’s pro-forma net
income. Dick’s Sporting Goods was again the most
profitable publicly held full-line sporting goods
retailer in the country as measured by income
from continuing operations and adjusted for our
competitors’ non-recurring items.