Dick's Sporting Goods 2013 Annual Report Download

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2013 ANNUAL REPORT

Table of contents

  • Page 1
    2013 ANNUAL REPORT

  • Page 2
    ... this by transforming DICK'S from a local bait-and-tackle shop into the largest and most profitable publicly held full-line sporting goods retailer in the nation. As we enter 2014, we are continuing to reward our customers, shareholders, employees and vendors with the exceptional value they've come...

  • Page 3
    ... the Company's website at http://www.dickssportinggoods.com/investors. All fiscal years presented include 52 weeks of operations except fiscal 2012, which includes 53 weeks. Fiscal 2012 excludes sales during the 53rd week of operations. 2 3 DICK'S SPORTING GOODS // 2013 ANNUAL REPORT // 1 31...

  • Page 4
    ... plan for our future and drive relentless improvement in every area of our business-whether we are interacting with our customers, expanding our omni-channel platform, or exploring innovative ways to reach and serve today's athletes and outdoor enthusiasts. 2 // DICK'S SPORTING GOODS // 2013 ANNUAL...

  • Page 5
    ...Increased online conversion by over 30% • Created dedicated eCommerce commercial for holiday • Launched new tablet optimized site ALL 558 STORES ENABLED FOR SHIP-FROM-STORE Our continuous dedication has made DICK'S the largest and most profitable publicly held full-line sporting goods retailer...

  • Page 6
    ... our stores fuel eCommerce growth by promoting brand awareness, encouraging customer loyalty across all channels, allowing fast and easy in-store exchanges, and enabling us to offer integrated capabilities like buyonline, pick-up in-store, which we are currently testing. We plan to expand our store...

  • Page 7
    ... our Board authorized in 2013. COMMITMENT TO GROWTH 2013 • Opened 40 new DICK'S Sporting Goods stores, an approximately eight percent growth rate • Enhanced eCommerce platform by expanding our ship-from-store capability, piloting buy-online, pick-up in-store, and optimizing our mobile site for...

  • Page 8
    ...their homes. We also link our eCommerce and store channels through functions that maximize our nationwide inventory and expedite shipping times, such as ship-from-store, which we rolled out in 2013, and buy-online, pick-up in-store, which we are currently testing. 6 // DICK'S SPORTING GOODS // 2013...

  • Page 9
    .... Our unique retail concept unites several sports specialty stores under one roof, enabling us to combine the premium services and exclusive amenities of a specialty store with the scale advantages of a national chain. 558 DICK'S STORES IN 46 STATES DICK'S SPORTING GOODS // 2013 ANNUAL REPORT // 7

  • Page 10
    8 // DICK'S SPORTING GOODS // 2013 ANNUAL REPORT

  • Page 11
    DICK'S SPORTING GOODS // 2013 ANNUAL REPORT // 9

  • Page 12
    ... from a team of PGA and LPGA pros, on-site golf simulators, launch monitors and putting greens, as well as access to a complete selection of tour-grade equipment services, such as re-gripping and club repair provided by Certified Club Technicians. 10 // DICK'S SPORTING GOODS // 2013 ANNUAL REPORT

  • Page 13
    ...WE'LL DELIVER YOUR MERCHANDISE RIGHT TO YOU. WE MEET THE NEEDS OF DISCERNING GOLFERS BY FEATURING CUTTING-EDGE EQUIPMENT AND TECHNOLOGY, ALONG WITH CUSTOM FITTING SERVICES AND EXCLUSIVE PRIVATE BRANDS. TRUST THE PROS PGA/LPGA PROS CLUB TECHNICIANS DICK'S SPORTING GOODS // 2013 ANNUAL REPORT // 11

  • Page 14
    ... offer a selection of in-store amenities, such as an archery range for testing potential purchases and a menu of specialized equipment services to keep outdoor gear in peak condition, including mounting rifle-scopes, spooling lines and cutting arrow heads. 12 // DICK'S SPORTING GOODS // 2013 ANNUAL...

  • Page 15
    ...YOUR FRONT DOOR. OUR LODGE ASSOCIATES ARE SEASONED OUTDOOR ENTHUSIASTS WITH FIRST-HAND KNOWLEDGE OF THE LOCAL TERRAIN AND PERSONAL EXPERIENCE IN USING OUR PRODUCTS. TRUST THE PROS FISHING SERVICES GUN SERVICES ARCHERY SERVICES CO2 FILLING SERVICES DICK'S SPORTING GOODS // 2013 ANNUAL REPORT // 13

  • Page 16
    ..., Pearl Izumi, Giro, Bell and our private Nishiki brand. Our cycle shops also offer a full range of services, including custom fittings, safety inspections, repairs, tune-ups and assembly, all provided by our team of Certified Bike Technicians. 14 // DICK'S SPORTING GOODS // 2013 ANNUAL REPORT

  • Page 17
    ... BUYING GUIDES AND MAKE A PURCHASE. OUR CERTIFIED FITNESS TRAINERS OFFER INFORMED GUIDANCE ON FITNESS EQUIPMENT, ACCESSORIES AND TRAINING TECHNIQUES, HELPING OUR CUSTOMERS TO REACH THEIR PERSONAL GOALS. TRUST THE PROS BIKE SERVICES CERTIFIED FITNESS TRAINERS DICK'S SPORTING GOODS // 2013 ANNUAL...

  • Page 18
    ... and apparel they need for every sport in every season. We do our part for these organizations by donating equipment to area coaches, offering special league discounts, hosting player registrations for local teams and staging instructional clinics. 16 // DICK'S SPORTING GOODS // 2013 ANNUAL REPORT

  • Page 19
    ... KEEP THEIR GEAR IN PRIME CONDITION, INCLUDING STEAMING NEW BASEBALL GLOVES, STRINGING LACROSSE AND TENNIS RACQUETS, FITTING BOWLING BALLS AND SHARPENING HOCKEY SKATES. TRUST THE PROS LACROSSE SERVICES RACQUET SERVICES GLOVE SERVICES SKATE SERVICES DICK'S SPORTING GOODS // 2013 ANNUAL REPORT // 17

  • Page 20
    ... and sizes that suit their specific needs. Our associates also leverage our on-site tracks and treadmills to offer custom gait analyses that can help runners to zero in on the best footwear options for their personal styles and individual goals. 18 // DICK'S SPORTING GOODS // 2013 ANNUAL REPORT

  • Page 21
    ... YOUR STRIDE TO GET THE STYLES AND SIZES YOU NEED ON-THE-GO. MANY OF OUR STORES FEATURE A SHARED-SERVICE CONCEPT THAT GIVES CUSTOMERS THE CHOICE OF WORKING WITH OUR SPECIALLY TRAINED FOOTWEAR ASSOCIATES OR HELPING THEMSELVES WITH SELECT PRODUCTS. DICK'S SPORTING GOODS // 2013 ANNUAL REPORT // 19

  • Page 22
    ... premier specialty shops like Nike Field House, Under Armour All-American, Under Armour Blue Chip, adidas and The North Face, as well as "sports-fan" walls that are exclusively dedicated to high-demand licensed items from the NFL, MLB, NBA and NHL. 20 // DICK'S SPORTING GOODS // 2013 ANNUAL REPORT

  • Page 23
    ...RIGHT IN THE PALM OF YOUR HAND. WE DRAW ON OUR VENDOR RELATIONSHIPS TO DEVELOP UNIQUE STYLE AND COLOR COMBINATIONS AVAILABLE EXCLUSIVELY AT DICK'S, AND WE LEVERAGE OUR PRIVATE BRANDS TO CREATE INNOVATIVE GARMENTS THAT COMBINE PERFORMANCE AND STYLE. DICK'S SPORTING GOODS // 2013 ANNUAL REPORT // 21

  • Page 24
    ... Galaxy eCommerce site, setting the stage to bring the management of this site in-house in 2014. This measure will enable us to offer an enhanced omni-channel experience with access to value-added capabilities, such as ship-from-store and in-store pickup. 22 // DICK'S SPORTING GOODS // 2013 ANNUAL...

  • Page 25
    ... and tackle, which offer outdoor enthusiasts a broad range of professional-grade equipment services, from arrow cutting to line spooling. We believe Field & Stream is a powerful growth vehicle, and we plan to expand our network from the two stores that we opened in 2013 to approximately 55 Field...

  • Page 26
    ... programs including donations to local sports teams and the launch of the DICK'S Sporting Goods Foundation's "Sports Matter" initiative. The Sports Matter program aims to address the growing issue of underfunded youth athletics nationwide, through an extensive public awareness campaign and a new...

  • Page 27
    ..., Coraopolis, Pennsylvania 15108 (724) 273-3400 (Address of principal executive offices, zip code, telephone number) Securities registered pursuant to Section 12(b) of the Act: Title of each class Common Stock, $0.01 par value Name of Each Exchange on which Registered The New York Stock Exchange...

  • Page 28
    ... Corporate Governance ...Item 11. Executive Compensation ...Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters ...Item 13. Certain Relationships and Related Transactions, and Director Independence ...Item 14. Principal Accountant Fees and Services...

  • Page 29
    ... of available retail store sites on terms acceptable to us, rising real estate prices and other costs and risks relating to our stores, or our inability to open new stores; Unauthorized disclosure of sensitive or confidential customer information; Risks associated with our private brand offerings...

  • Page 30
    ..., opened his original bait and tackle store in Binghamton, New York. Edward W. Stack joined his father's business full-time in 1977 and in 1984 became President and Chief Executive Officer of the then two store chain. Our vision is to build leading brands that serve and inspire athletes and outdoor...

  • Page 31
    ... 2008 to 558 Dick's Sporting Goods stores at the end of fiscal 2013. We seek to expand our presence through opening of new stores and have the potential to reach approximately 1,100 Dick's Sporting Goods locations, including smaller-market locations across the United States. We also make continued...

  • Page 32
    ... shopping experience. In fiscal 2014, we plan to open one new and relocate two Golf Galaxy stores based on the new prototype. Strategic Marketing. Our historical marketing strategy was designed to promote our selection of brand name products at competitive prices and consisted largely of newspaper...

  • Page 33
    ... sporting goods equipment, fitness equipment, golf equipment and hunting and fishing gear. Includes the Company's non-merchandise sales categories, including in-store services and shipping revenues. (2) Selling Channels We offer products to our customers through our retail stores and our eCommerce...

  • Page 34
    ...table summarizes store openings and closings for 2013 and 2012: Dick's Sporting Goods Beginning stores New stores: Single-level stores Two-level stores Total new stores Ending stores Closed stores Ending stores Remodeled stores Relocated stores (1) Fiscal 2013 Golf Galaxy / Specialty Store Concepts...

  • Page 35
    ... for our customers to buy merchandise online and pick it up in store. In fiscal 2013, our eCommerce business accounted for approximately 8% of our total sales. Marketing and Advertising Our marketing program is designed to build loyalty for the Dick's Sporting Goods brand while promoting our broad...

  • Page 36
    ...Goods Stores and Chains; Traditional Sporting Goods Stores and Chains; Specialty and Vendor Stores; Mass Merchants and Department Stores; and Internet and Catalog-Based Retailers. Large Format Sporting Goods Stores The large format stores generally range from 20,000 to 100,000 square feet and offer...

  • Page 37
    ...Senior Vice President, Planning and Allocation. Prior to that role, he spent seven years in our store organization as a Regional Vice President and ultimately as Vice President - Operations over all regions. Mr. Duken joined Dick's Sporting Goods in 1999 as Vice President - Operations of dsports.com...

  • Page 38
    ... Executive Vice President - Inventory, Supply Chain and eCommerce since July 2013. Prior to that she served as our Senior Vice President - eCommerce since 2010. She joined Dick's Sporting Goods in 2004 as Vice President, Planning and Allocation. Ms. Willoughby was promoted to Senior Vice President...

  • Page 39
    ..., mobile communications and the provision of online payment services. Unfavorable changes to regulations in these areas could harm our business. Lack of available retail store sites on terms acceptable to us, rising real estate prices and other costs and risks relating to new store openings could...

  • Page 40
    ...resources and marketing efforts relating to these private brand offerings. Although we believe that our private brand products offer value to our customers at each price point and provide us with higher gross margins than comparable products we sell, the expansion of our private brand offerings also...

  • Page 41
    ... property laws and regulations; and those relating to the provision of online payment services and use of credit cards by our customers. Our policies and procedures are designed to comply with all applicable laws, accounting and reporting requirements, tax rules and other regulations and...

  • Page 42
    ...and hour laws, product liability, consumer protection, advertising, employment, intellectual property, tort and other matters. We may also be subject to lawsuits relating to the design, manufacture or distribution of our private brand products. In addition, although we do not sell assault weapons or...

  • Page 43
    ... may lose merchandise and be unable to effectively deliver it to our stores. We currently operate a 725,000 square foot distribution center in Plainfield, Indiana, a 657,000 square foot distribution center near Atlanta, Georgia, a 601,000 square foot distribution center in Smithton, Pennsylvania and...

  • Page 44
    ... 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...

  • Page 45
    ... corporate headquarters, adjacent to its current headquarters location. The lease provides the Company with an additional 89 acres for expansion. We currently lease a 725,000 square foot distribution center in Plainfield, Indiana, a 657,000 square foot distribution center near Atlanta, Georgia and...

  • Page 46
    ...State Alabama Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina Ohio Oklahoma...

  • Page 47
    ... DISCLOSURES Not applicable. PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES MARKET INFORMATION AND DIVIDEND POLICY The shares of Dick's Sporting Goods, Inc. common stock are listed and traded on the New York Stock Exchange...

  • Page 48
    ... as part of the Company's previously announced five-year $1 billion share repurchase program, authorized by the Board on March 7, 2013. (b) The information set forth under Part III, Item 12. "Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters" is...

  • Page 49
    ... footage at end of period Net sales per square foot (9) Other Data: Gross profit margin Selling, general and administrative expenses as a percentage of net sales Operating margin Inventory turnover (10) (8) (6) 2012 2011 2010 2009 (Dollars in thousands, except per share and per square foot data...

  • Page 50
    ... in fiscal 2010. The same store sales calculation for fiscal 2012 excluded sales during the 53rd week. Includes Dick's Sporting Goods, Golf Galaxy, Field & Stream and True Runner stores. Calculated using net sales and gross square footage of all stores open at both the beginning and the end of the...

  • Page 51
    ... 2008 to 558 Dick's Sporting Goods stores at the end of fiscal 2013. The Company continues to expand its presence through the opening of new stores and believes it has the potential to reach approximately 1,100 Dick's Sporting Goods locations, including smaller-market locations across the United...

  • Page 52
    ... stores, a specialized outdoor concept. Repurchased 4.8 million shares of common stock for $255.6 million. Made substantial capital investments in the business, increasing capital expenditures to $285.7 million in fiscal 2013 from $219.0 million in fiscal 2012. • The Company ended fiscal 2013...

  • Page 53
    ... support payroll and fringe benefits, advertising, bank card charges, information systems, marketing, legal, accounting, other store expenses and all expenses associated with operating the Company's corporate headquarters. Selling, general and administrative expenses for the 52 weeks ended February...

  • Page 54
    ... 2012. Pre-opening expenses in any period fluctuate depending on the timing and number of store openings and relocations. During fiscal 2013, the Company opened 40 new Dick's Sporting Goods stores, one new Golf Galaxy store, two new Field & Stream stores and one new True Runner store. Additionally...

  • Page 55
    ... have impacted fiscal 2012 earnings before income taxes by approximately $17 million. Store Count During fiscal 2012, the Company opened 38 new Dick's Sporting Goods stores and two new True Runner stores. Additionally, the Company relocated five Dick's Sporting Goods stores and repositioned one Golf...

  • Page 56
    ... the timing and number of store openings and relocations. During fiscal 2012, the Company opened 38 new Dick's Sporting Goods stores and two new True Runner stores, relocated five Dick's Sporting Goods stores and repositioned one Golf Galaxy store. During fiscal 2011, the Company opened 36 new Dick...

  • Page 57
    ... and featured branded vendor shops. The Company added 114 Nike Fieldhouse shops and 131 Under Armour shops in new and existing Dick's Sporting Goods stores in fiscal 2013, including shops added as part of our apparel remodels. Additionally, we also worked closely with The North Face to add 81...

  • Page 58
    ... in financing activities for fiscal 2013 totaled $228.1 million compared to $503.1 million in fiscal 2012, primarily reflecting the Company's purchase of its corporate headquarters building and payment of a special cash dividend in fiscal 2012, partially offset by higher share repurchases in fiscal...

  • Page 59
    ... relate primarily to marketing commitments, including naming rights, licenses for trademarks and technology-related and other commitments. In the ordinary course of business, the Company enters into many contractual commitments, including purchase orders and commitments for products or services...

  • Page 60
    ... physical inventories at its stores and distribution centers throughout the year. The reserve for shrink represents an estimate for shrink for each of the Company's locations since the last physical inventory date through the reporting date. Estimates by location and in the aggregate are impacted by...

  • Page 61
    ... assets. Based on an analysis of current and future store performance, management periodically evaluates the need to close underperforming stores. Reserves are established when the Company ceases to use the location for the present value of any remaining operating lease obligations, net of estimated...

  • Page 62
    ... ABOUT MARKET RISK Interest Rate Risk The Company maintains a revolving credit facility to support potential liquidity and capital needs. Our interest rate under the Credit Agreement is benchmarked to, at the Company's option, a base rate or an adjusted LIBOR rate plus, in each case, an applicable...

  • Page 63
    ...testing of the operating effectiveness of controls and a conclusion on this evaluation. Based on this evaluation, management concluded that the Company's internal control over financial reporting was effective as of February 1, 2014. Deloitte & Touche LLP, an independent registered public accounting...

  • Page 64
    ... OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders of Dick's Sporting Goods, Inc. Pittsburgh, Pennsylvania We have audited the internal control over financial reporting of Dick's Sporting Goods, Inc. and subsidiaries (the "Company") as of February 1, 2014...

  • Page 65
    ...: The Dick's Sporting Goods Code of Business Conduct and Ethics" (the "Code of Business Conduct and Ethics") that applies to all of its employees, including Executive Officers, and the Board of Directors, the complete text of which is available through the Investor Relations section of the Company...

  • Page 66
    ...caption "Certain Relationships and Transactions with Related Persons" and "Election of Directors - How does the Board determine which directors are considered independent?" in the Company's 2014 Proxy Statement. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES The information required by this Item is...

  • Page 67
    ... FINANCIAL STATEMENTS Page 42 43 44 45 46 47 48 - 66 Report of Independent Registered Public Accounting Firm Consolidated Statements of Income for the Fiscal Years Ended February 1, 2014, February 2, 2013 and January 28, 2012 Consolidated Statements of Comprehensive Income for the Fiscal Years...

  • Page 68
    ...ACCOUNTING FIRM To the Board of Directors and Stockholders of Dick's Sporting Goods, Inc. Pittsburgh, Pennsylvania We have audited the accompanying consolidated balance sheets of Dick's Sporting Goods, Inc. and subsidiaries (the "Company") as of February 1, 2014 and February 2, 2013, and the related...

  • Page 69
    DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Amounts in thousands, except per share data) Fiscal Year Ended February 1, 2014 Net sales Cost of goods sold, including occupancy and distribution costs GROSS PROFIT Selling, general and administrative expenses Pre-...

  • Page 70
    DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Dollars in thousands) Fiscal Year Ended February 1, 2014 NET INCOME OTHER COMPREHENSIVE LOSS Unrealized (loss) gain on securities available-for-sale... $ February 2, 2013 290,709 $ January 28, 2012 263,906 44

  • Page 71
    DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except share and per share data) February 1, 2014 ASSETS CURRENT ASSETS: Cash and cash equivalents Accounts receivable, net Income taxes receivable Inventories, net Prepaid expenses and other current ...

  • Page 72
    ... availablefor-sale, net of taxes of $4,734 Purchase of shares for treasury Cash dividends declared, $2.50 per common share BALANCE, February 2, 2013 Exercise of stock options Restricted stock vested Minimum tax withholding requirements Net income Stock-based compensation Total tax benefit from...

  • Page 73
    ...Stock-based compensation Excess tax benefit from exercise of stock options Tax benefit from exercise of stock options Other non-cash items Gain on sale of investment Changes in assets and liabilities: Accounts receivable Inventories Prepaid expenses and other assets Accounts payable Accrued expenses...

  • Page 74
    ... retailer offering a broad assortment of high-quality, competitively priced brand name sporting goods equipment, apparel and footwear in a specialty store environment. Fiscal Year - The Company's fiscal year ends on the Saturday closest to the end of January. Fiscal years 2013, 2012 and 2011 ended...

  • Page 75
    ... and stock options to purchase common stock under the Dick's Sporting Goods, Inc. 2012 Stock and Incentive Plan. The Company records stock-based compensation expenses based on the fair value of stock awards at the grant date and recognizes the expense over the related service period. Income Taxes...

  • Page 76
    ...Expenses - Selling, general and administrative expenses include store and field support payroll and fringe benefits, advertising, bank card charges, information systems, marketing, legal, accounting, other store expenses and all expenses associated with operating the Company's corporate headquarters...

  • Page 77
    DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) The Company's accounting for construction allowances differs if the Company is deemed to be the owner of the asset during the construction period. Some of the Company's leases have a cap on the ...

  • Page 78
    DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) The components of intangible assets were as follows (in thousands): 2013 Gross Accumulated Amount Amortization Trademarks (indefinite-lived) Trade name (indefinite-lived) Customer list Favorable ...

  • Page 79
    ... as of the end of the fiscal periods (in thousands): 2013 Accrued payroll, withholdings and benefits Accrued real estate taxes, utilities and other occupancy Accrued property and equipment Accrued sales tax Other accrued expenses Total accrued expenses 6. Deferred Revenue and Other Liabilities...

  • Page 80
    DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) 7. Debt The Company's outstanding debt consists of the following as of the end of the fiscal periods (in thousands): 2013 Revolving line of credit Capital leases Other debt Total debt Less: current...

  • Page 81
    ... for fiscal 2013, 2012 and 2011, respectively. The Company entered into sale-leaseback transactions related to store fixtures, buildings and equipment that resulted in cash receipts of $3.4 million and $21.1 million for fiscal 2012 and 2011, respectively. Scheduled lease payments due under non...

  • Page 82
    ... and Employee Stock Plans The Company has the ability to grant restricted shares of common stock, restricted stock units and options to purchase common stock under the Dick's Sporting Goods, Inc. 2012 Stock and Incentive Plan (the "Plan"). As of February 1, 2014, shares of common stock available for...

  • Page 83
    ...,784 107,179 118,008 The aggregate intrinsic value reported in the table above is based on the Company's closing stock prices for the last business day of the period indicated. The total intrinsic value for stock options exercised during 2013, 2012 and 2011 was $67.2 million, $186.5 million and $61...

  • Page 84
    DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) The Company issues new shares of common stock upon exercise of stock options. Additional information regarding options outstanding as of February 1, 2014 is as follows: Options Outstanding Weighted...

  • Page 85
    DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) During 2013, the Company granted 1,185,793 shares of performance-based restricted stock in support of the Company's fiveyear strategic plan. As of February 1, 2014, nonvested restricted stock ...

  • Page 86
    ... as of the fiscal periods ended (in thousands): 2013 Inventory Store closing expense Stock-based compensation Capital loss carryforward Employee benefits Other accrued expenses not currently deductible for tax purposes Deferred rent Insurance Gift cards Deferred revenue currently taxable Non income...

  • Page 87
    ...that changes in its unrecognized tax benefits will have a material impact on the Consolidated Statements of Income during fiscal 2014. The Company participates in the Internal Revenue Service ("IRS") Compliance Assurance Program ("CAP"). As part of the CAP, tax years are audited on a contemporaneous...

  • Page 88
    ... and $0.2 million for fiscal 2013, 2012 and 2011, respectively. 14. Commitments and Contingencies Marketing and Naming Rights Commitments Within the ordinary course of business, the Company enters into contractual commitments in order to promote the Company's brand and products, including media and...

  • Page 89
    ... on qualified purchases or retail sales (dependent upon the agreement) exceed the guaranteed minimum. The aggregate payments under these commitments were $16.8 million, $17.8 million and $9.0 million during fiscal 2013, 2012 and 2011, respectively. The aggregate amount of future minimum payments at...

  • Page 90
    ... quarter ended July 28, 2012. During the first quarter of 2013, the Company recorded $4.3 million related to the partial recovery of its fully impaired investment in JJB Sports. The Company has received, and may receive in future periods, additional immaterial recoveries. 16. Fair Value Measurements...

  • Page 91
    ... value of the asset at the time of sale. The transaction was approved pursuant to the Company's Related Party Transaction Policy. 18. Quarterly Financial Information (Unaudited) Summarized quarterly financial information for fiscal 2013 and 2012 is as follows (in thousands, except earnings per share...

  • Page 92
    ...14, 2014, our Board of Directors declared a quarterly cash dividend in the amount of $0.125 per share of common stock and Class B common stock payable on March 28, 2014 to stockholders of record as of the close of business on March 7, 2014. On March 5, 2014, the Company sold a corporate aircraft for...

  • Page 93
    ... the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. DICK'S SPORTING GOODS, INC. (Registrant) By: /s/ ANDRÉ J. HAWAUX André J. Hawaux Executive Vice President - Finance, Administration and Chief Financial Officer Date: March 28, 2014...

  • Page 94
    ...REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders of Dick's Sporting Goods, Inc. Pittsburgh, Pennsylvania We have audited the consolidated financial statements of Dick's Sporting Goods, Inc. and subsidiaries (the "Company") as of February 1, 2014, and February 2, 2013, and...

  • Page 95
    DICK'S SPORTING GOODS, INC. AND SUBSIDIARIES SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS (Dollars in thousands) Balance at Beginning of Period Fiscal 2011 Inventory reserve Allowance for doubtful accounts Reserve for sales returns Fiscal 2012 Inventory reserve Allowance for doubtful accounts ...

  • Page 96
    ...executive officers, directors and employees under Registrant's Amended and Restated 2002 Stock and Incentive Plan Option Agreement between Registrant and Edward W. Stack Amended and Restated Lease Agreement, originally dated February 4, 1999, for distribution center located in Smithton, Pennsylvania...

  • Page 97
    ... joint lead arrangers and joint book managers. Offer Letter between the Company and Lauren R. Hobart, Senior Vice President and Chief Marketing Officer Lease Agreement originally dated June 25, 2007, for distribution center located in East Point, Georgia, between Duke Realty Limited Partnership and...

  • Page 98
    ... herewith Filed herewith Attached as Exhibits 101 to this report are the following financial statements from the Company's Annual Report on Form 10-K for the year ended February 1, 2014 formatted in XBRL ("eXtensible Business Reporting Language"): (i) the Consolidated Statements of Income, (ii) the...

  • Page 99
    ... liability company Galyan's of Virginia, Inc., a Virginia corporation Galyan's Nevada, Inc., a Nevada corporation Golf Galaxy, LLC, a Minnesota limited liability company Golf Galaxy GolfWorks, Inc., an Ohio corporation Criterion Golf Technology, Inc., a Canada corporation Chick's Sporting Goods, LLC...

  • Page 100
    ... effectiveness of Dick's Sporting Goods, Inc. and subsidiaries' internal control over financial reporting, appearing in this Annual Report on Form 10-K of Dick's Sporting Goods, Inc. and subsidiaries for the fiscal year ended February 1, 2014. /s/ Deloitte & Touche LLP Pittsburgh, Pennsylvania March...

  • Page 101
    ..., certify that: 1. 2. I have reviewed this Annual Report on Form 10-K of Dick's Sporting Goods, Inc. (the "registrant"); Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the...

  • Page 102
    ... or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. 3. 4. /s/ ANDRÉ J. HAWAUX André J. Hawaux Executive Vice President - Finance, Administration and Chief Financial Officer Date: March 28, 2014...

  • Page 103
    ... connection with the Annual Report on Form 10-K of Dick's Sporting Goods, Inc. (the "Company") for the period ended February 1, 2014, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Edward W. Stack, Chief Executive Officer of the Company, certify, pursuant...

  • Page 104
    ... connection with the Annual Report on Form 10-K of Dick's Sporting Goods, Inc. (the "Company") for the period ended February 1, 2014, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, André J. Hawaux, Chief Financial Officer of the Company, certify, pursuant...

  • Page 105
    This Page Intentionally Left Blank DICK'S SPORTING GOODS // 2013 ANNUAL REPORT // 79

  • Page 106
    ...(8,738) $ (5,162) (13,900) $ (1,289) (859) (2,148) $ $ 253,879 162,099 13,868 116,581 546,427 Presents EBITDA adjusted for a gain on sale of investment and a partial reversal of litigation settlement costs previously accrued during fiscal 2010. 80 // DICK'S SPORTING GOODS // 2013 ANNUAL REPORT

  • Page 107
    ... (ROIC) 2013 (Dollars in thousands) 2012 2011 2010 2009 2008 Net income (loss) Impairment of goodwill and other intangible assets, after tax Impairment of store assets, after tax Merger and integration costs, after tax Gain on sale of asset, after tax Golf Galaxy store closing costs, after...

  • Page 108
    ... pre-tax $7.9 million non-cash impairment charge to reduce the carrying value of a corporate aircraft held for sale to its fair market value. The provision for income taxes was calculated at 40%, which approximates the Company's blended tax rate. 2 82 // DICK'S SPORTING GOODS // 2013 ANNUAL REPORT

  • Page 109
    ...-tax charge of $32.4 million. The Company recorded a deferred tax asset valuation allowance of approximately $7.9 million for a portion of the $32.4 million net capital loss carryforward that it expected not to realize at the time of the impairment. DICK'S SPORTING GOODS // 2013 ANNUAL REPORT // 83

  • Page 110
    ... the 13 and 52 weeks ended February 1, 2014. Year Ended February 2, 2013 (Dollars in thousands) 14 Weeks Ended 53 Weeks Ended Net sales Less: 53rd week net sales Adjusted Net Sales $ 1,805,302 $ 5,836,119 (74,445) (74,445) $ 1,730,857 $ 5,761,674 84 // DICK'S SPORTING GOODS // 2013 ANNUAL REPORT

  • Page 111
    ... 1/29/10 4/30/10 7/30/10 1/28/11 4/29/11 7/29/11 1/27/12 4/27/12 7/27/12 8/2/13 11/1/13 1/31/14 â- DATE OF CLOSING PRICE The stock performance graph is not necessarily indicative of future performance. DICK'S SPORTING GOODS // 2013 ANNUAL REPORT // 85

  • Page 112
    ...Website www.DicksSportingGoods.com Transfer Agent and Registrar American Stock Transfer & Trust Company 59 Maiden Lane New York, NY 10038 Independent Registered Public Accounting Firm Deloitte & Touche LLP One PPG Place Suite 2500 Pittsburgh, PA 15222 Common Stock The shares of Dick's Sporting Goods...

  • Page 113
    ...B. Willoughby Executive Vice President - Inventory, Supply Chain, eCommerce Joseph R. Oliver Senior Vice President - Chief Accounting Officer André J. Hawaux Executive Vice President - Finance, Administration & Chief Financial Officer Lauren R. Hobart Senior Vice President - Chief Marketing Of...

  • Page 114
    DICK'S SPORTING GOODS, INC. 345 Court Street Coraopolis, PA 15108 724-273-3400 www.DicksSportingGoods.com