Dick’s targets 11 percent growth over next five years

REPORT_ Dick’s Sporting Goods unveiled its detailed

long-term plan and key strategies to deliver sales and operating profit growth and drive shareholder value over the next five years. During its analyst day meeting, the company presented a sales target of 10 billion dollars by the end of fiscal 2017, representing a 5-year compounded annual growth rate (CAGR) of approximately 11 percent from fiscal 2012 sales of 5.8 billion dollars.

The company is focused on driving profitable growth and believes it can expand its operating margin by approximately 150 bps to 10.5 percent in fiscal 2017, from 9.0 percent in fiscal 2012, through both the expansion of gross margin and leverage of SG&A expenses. The key drivers of the company’s long-term growth are expected to be Dick’s Sporting Goods stores, e-commerce growth through the company's omni-channel platform and the Field & Stream brand.

“We are excited about the profitable long-term growth opportunities across our business in our Dick'S Sporting Goods stores, online and through our Field & Stream concept,” said Edward W. Stack, Chairman and CEO. The company anticipates growing its store base to over 800 Dick’s Sporting Goods stores by the end of fiscal 2017, an increase of approximately 300 stores from the 518 stores at the end of fiscal 2012. Company has developed a range of prototypes depending on market characteristics, including its traditional 50,000 square feet single-level stores, 35,000 square feet smaller market stores and 80,000 square feet two-level stores.

The Company also discussed its plan to grow e-commerce sales to approximately 1.1 billion dollars by the end of fiscal 2017, from 292 million dollars in fiscal 2012. The company is planning to internally control its eCommerce platform, beginning with Golf Galaxy and Field & Stream in 2014 and Dick’s Sporting Goods by the end of fiscal 2017.

The company announced plans to grow its Field & Stream outdoor specialty concept to approximately 55 stores and 750 million dollars in sales by the end of fiscal 2017, capitalizing on its heritage in this category and a core outdoor market estimated at over 30 billion dollars.

Company also reaffirmed its capital allocation strategy to provide returns to shareholders through investing in the business, repurchasing shares and paying dividends. To drive the growth of the business the company expects to invest approximately 1.8 billion dollars in capital expenditures over the next five years, primarily in new stores, store remodels and e-commerce. In addition to its quarterly dividend, the company's existing up to 1 billion dollars 5-year share repurchase authorization provides the capacity to both offset dilution and also acquire shares opportunistically.