Dick's Sporting Goods 2014 Annual Report Download - page 43

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Poor performance of professional sports teams within our core regions of operation, as well as professional team lockouts or
strikes, retirement of sports superstars or scandals involving sports superstars could adversely affect our financial results.
We sell a significant amount of professional sports team merchandise, the sale of which may be subject to fluctuations based on
the success or failure of such teams. The poor performance by the professional sports teams within our core regions of
operations, as well as professional team lockouts and strikes, could cause our financial results to fluctuate accordingly year over
year. In addition, to the extent we use sports superstars to market our products and advertise our stores, or we sell merchandise
branded by one or more sports superstars, the retirement of such individuals or scandals in which they may be implicated could
negatively impact our financial results.
The relative seasonality of our operations, along with the current geographic concentrations of our Dick's stores, exposes us
to certain risks.
Our business is seasonal based on sports seasons. Furthermore, a majority of our Dick's Sporting Goods stores are located in the
eastern half of the United States, which exposes us to various regional risks, including those relating to weather conditions.
Many of our stores are located in geographic areas that experience seasonably cold weather, and we sell a significant amount of
cold weather sporting goods and apparel. Our highest sales and operating income results historically occur during our fourth
fiscal quarter, which is due, in part, to the holiday selling season and, in part, to our strong sales of cold weather sporting goods
and apparel. Abnormally warm weather conditions could reduce our sales of these items and cause a decrease in our
profitability. The fourth quarter generated approximately 32% of our net sales for fiscal 2014. Poor performance during our
fourth quarter, whether because of a slow holiday selling season, unseasonable weather conditions, economic conditions or
otherwise, could have a material adverse effect on our business, financial condition and operating results for the entire fiscal
year. Additionally, abnormally wet or cold weather in the spring or summer months could reduce our sales of golf, team sports
or other merchandise and cause a decrease in our profitability.
We may pursue strategic acquisitions or investments and the failure of an acquisition or investment to produce the
anticipated results or the inability to fully integrate the acquired companies could have an adverse impact on our business.
We may from time to time acquire or invest in complementary companies or businesses. The success of such acquisitions or
investments is based on our ability to make accurate assumptions regarding the valuation, operations, growth potential,
integration and other factors relating to the respective business. There can be no assurance that our acquisitions or investments
will produce the results that we expect at the time we enter into or we complete the transaction. For example, we may not be
able to capitalize on previously anticipated synergies. Furthermore, acquisitions may result in dilutive issuances of our equity
securities, the incurrence of debt, contingent liabilities, amortization expenses or write-offs of goodwill or other intangibles, any
of which could harm our financial condition. We also may not be able to successfully integrate operations that we acquire,
including their personnel, financial systems, supply chain and other operations, which could adversely affect our business.
Acquisitions may also result in the diversion of our capital and our management's attention from other business issues and
opportunities.
We are controlled by our Chairman and Chief Executive Officer and his relatives, whose interests may differ from other
stockholders.
We have two classes of common stock: our common stock has one vote per share and our Class B common stock has 10 votes
per share. As of January 31, 2015, Mr. Edward W. Stack, our Chairman and Chief Executive Officer, and his relatives controlled
a majority of the combined voting power of our common stock and Class B common stock and would control the outcome of a
vote on any corporate transaction or other matter submitted to our stockholders for approval, including mergers, consolidations
and the sale of all or substantially all of our assets. The interests of Mr. Stack and his relatives may differ from the interests of
our other stockholders and they may take actions with which our other stockholders disagree.