SPORTSMAN'S WAREHOUSE HOLDINGS, INC.
For the period ended May 3, 2025. Filed Jun 4, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
May 3, 2025 · Filed Jun 4, 2025
SPWH$1.09-0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-11-02; filed 2024-12-11.
0000950170-24-135215
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-05-03; filed 2025-06-04.
0000950170-25-081405
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 110 previous paragraphs and 106 current paragraphs.
69 unchanged; 25 reworded; 10 added; 14 removed; 2 previous and 2 current paragraphs rearranged.
Tables are not compared: 4 previous and 4 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (10)
Current report
Recent changes in international trade policy and the implementation of increased tariff rates have caused substantial uncertainty with respect to our inventory cost. If some of the proposed and current changes to international trade and tariff policy are implemented or continue for a significant length of time, we will experience a material increase in our inventory costs, especially in our Hunting and Shooting and Optics, Electronics, Accessories and Other departments. We cannot predict the ultimate impact of such changes on our financial results for the remainder of fiscal year 2025 and beyond since such policies remain highly dynamic and evolving. In the first quarter of fiscal year 2025, we purchased additional inventory in anticipation of increased tariff rates and we expect to purchase additional strategic inventory in the second quarter of fiscal year 2025 in anticipation of further tariff rate increases to be prepared for the hunting and holiday seasons. We will continue to consider other means to mitigate the impact of increased tariff rates, including by seeking alternative sourcing of our products and by negotiating with our suppliers to absorb a portion of increased costs due to changes in tariff rates and trade policy; however, we cannot provide any assurances that we will be successful in such efforts.
Current report
For instance, in November 2022, Oregon passed a ballot measure that amended Oregon law to prohibit private citizens from manufacturing, importing, possessing, using, purchasing, selling or transferring a magazine capable of holding (or being readily converted to hold) over ten rounds of ammunition. Additionally, this ballot measure also imposed complex permitting and training requirements for the purchase and sale of firearms. On December 6, 2022, a state Circuit Court judge in Oregon preliminarily enjoined the implementation of the ballot measure. On November 21, 2023, the Circuit Court judge permanently enjoined implementation of the ballot measure upon a determination that the ballot measure was facially unconstitutional under Oregon's state constitution. On March 12, 2025, the Oregon Court of Appeals reversed the state Circuit Court judge's permanent injunction, holding that the ballot measure was in fact facially constitutional under Oregon's state constitution. The Oregon Court of Appeals ordered the Circuit Court judge to enter a declaratory judgment consistent with the Court of Appeals’ decision. On April 14, 2025, the plaintiffs filed a petition for review before the Oregon Supreme Court.
Current report
We believe the injunction of the Oregon ballot measure remains temporarily in effect pending a determination on the plaintiff’s petition for review before the Oregon Supreme Court. There is also a pending bill in the Oregon House (HB 3075) that seeks to delay and modify the implementation of the ballot measure’s permitting requirement and establish certain exemptions. This ballot measure is also being challenged in a related case in federal court that is presently on appeal before the U.S. Court of Appeals for the Ninth Circuit. However, due to a recent ruling upholding a similar magazine capacity restriction case in California (Virginia Duncan, et al. v. Rob Bonta, No. 23-55805 (9th Cir. 2023)), we believe it is unlikely that the ballot measure will be struck down by the U.S. Court of Appeals for the Ninth Circuit.
Current report
While we believe the injunction of the Oregon ballot measure remains in effect until the Oregon Supreme Court decides on the plaintiff’s petition for review, the ballot measure could still be found constitutional and implemented in its current form. We currently operate eight stores in the State of Oregon. If the ballot measure is allowed to take effect, whether because the Oregon Supreme Court denies the petition for review or ultimately upholds the Oregon Court of Appeals March 12, 2025 order, sales of firearms in Oregon may be halted or substantially diminished unless all permitting and training programs are fully developed by the state and/or law enforcement agencies at the time the ballot measure takes effect. If delays in establishing such permitting and training programs occur, it could result in a substantial decline in our sales of firearms and related products and reduce traffic to our stores in Oregon, which would significantly impact on our sales and gross margin.
Current report
build strong community connections and be the local choice for hunting and fishing solutions;
Current report
During fiscal year 2024 and continuing into the first quarter of fiscal year 2025, elevated inflation has adversely impacted our gross margins. In fiscal year 2025, we anticipate modest improvements in our gross margins, driven by continued careful management of variable expenses. However, during the first quarter of fiscal year 2025, these improvements were negatively impacted by our decision to pull forward inventory purchases in anticipation of increased tariffs.
Current report
Net Sales and Same Store Sales. Net sales increased by $4.9 million, or 2.0%, to $249.1 million during the 13 weeks ended May 3, 2025 compared to $244.2 million in the corresponding period of fiscal year 2024. Our net sales increased primarily due to increased sales in our Fishing and Hunting and Shooting departments as we continue to emphasize inventory in-stocks to ensure we have the right inventory at the right location at the right time.
Current report
E-commerce driven sales comprised more than 20% of total sales for the 13 weeks ended May 3, 2025 and increased by approximately 8% compared to the corresponding period in fiscal year 2024. Same store sales increased by 2.0% during the 13 weeks ended May 3, 2025 compared to the corresponding 13-week period of fiscal year 2024, primarily as a result of our inventory management efforts.
Current report
Our Fishing, Hunting and Shooting, Apparel and Footwear departments saw net sales increases of $3.0 million, $2.4 million, $0.8 million and $0.2 million, respectively, during the 13 weeks ended May 3, 2025 compared to the corresponding period of fiscal year 2024 primarily driven by increased unit sales due to our continued emphasis on maintaining sufficient inventory in-stocks of core items. Our Camping and Optics, Electronics, Accessories and Other departments saw net sales decreases of $1.3 million and $0.2 million, respectively, during the 13 weeks ended May 3, 2025 compared to the corresponding period of fiscal year 2024. We believe these decreases reflected the impact of broader macroeconomic conditions discussed above. We also believe our Camping department was impacted by the later spring and the timing of the Easter holiday. Within our Hunting and Shooting department, our ammunition category saw an increase of $0.5 million or 1.3% and our firearm category saw a decrease of $0.1 million or 0.1% during the 13 weeks ended May 3, 2025 compared to the corresponding period of fiscal year 2024. The increase in the ammunition category was primarily due to our efforts to ensure every day low pricing in key ammunition groups. The decrease in our firearms category was primarily driven by a shift in consumer behavior to lower cost firearms, however, we continued to consistently outpace the adjusted NICS background check data and gain market share within the firearm space.
Current report
Selling, General, and Administrative Expenses. Selling, general, and administrative expenses increased by $0.8 million, or 0.9%, to $95.3 million during the 13 weeks ended May 3, 2025, compared to $94.4 million for the corresponding period of fiscal year 2024. This increase was primarily the result of increased payroll and rent expenses of $2.4 million and $0.5 million, respectively, during the 13 weeks ended May 3, 2025. These increases were partially offset by decreases of $1.2 million and $0.5 million in other operating and depreciation expenses, respectively. As a percentage of net sales, selling, general, and administrative expenses decreased to 38.2% of net sales in the first quarter of fiscal year 2025, compared to 38.6% of net sales in the first quarter of fiscal year 2024, reflecting ourcontinued focus on expense management and fixed cost leverage gained from higher sales.
Removed paragraphs (14)
Previous report
Net Sales and Same Store Sales. Net sales decreased by $16.3 million, or 4.8%, to $324.3 million during the 13 weeks ended November 2, 2024 compared to $340.6 million in the corresponding period of fiscal year 2023. Our net sales decreased primarily due to the continued impact of consumer inflationary pressures on discretionary spending, resulting in a decline in store traffic and lower demand, particularly in ammunition, and across our Apparel and Footwear departments. This decrease was partially offset by net sales growth in our Fishing, Optics, Electronics, Accessories and Other and Camping departments. Stores that have been open for less than 12 months and were, therefore, not included in our same store sales, contributed $4.0 million to net sales. E-commerce driven sales comprised more than 18% of total sales for the 13 weeks ended November 2, 2024. Same store sales decreased by 5.7% during the 13 weeks ended November 2, 2024 compared to the corresponding 13-week period of fiscal year 2023, primarily as a result of inflationary pressures on consumer discretionary spending.
Previous report
Our Optics, Electronics, Accessories and Other, Fishing and Camping departments saw net sales increases of $1.7 million, $1.0 million and $0.1 million, respectively, during the 13 weeks ended November 2, 2024 compared to the corresponding period of fiscal year 2023 primarily driven by our reset of fishing inventory and the opening of 1 new store since October 28, 2023. Our Apparel, Footwear and Hunting and Shooting departments saw net sales decreases of $10.3 million, $6.6 million and $2.2 million, respectively, during the 13 weeks ended November 2, 2024 compared to the corresponding period of fiscal year 2023. Within our Hunting and Shooting department, our ammunition and firearm categories saw decreases of $5.9 million and $0.7 million or 10.7% and 1.1%, respectively, during the 13 weeks ended November 2, 2024 compared to the corresponding period of fiscal year 2023. The decreases in the firearm and ammunition categories were primarily due to the impact of consumer inflationary pressures on discretionary spending. This was partially offset by our opening of 1 new store since October 28, 2023.
Previous report
Selling, General, and Administrative Expenses. Selling, general, and administrative expenses decreased by $0.1 million, or 0.1%, to $100 million during the 13 weeks ended November 2, 2024, compared to $100.1 million for the corresponding period of fiscal year 2023. This decrease was primarily the result of decreases in payroll, pre-opening and depreciation expenses of $0.9 million, $0.9 million and $0.7 million, respectively, during the 13 weeks ended November 2, 2024. These reductions were primarily related to increased operational efficiencies and the decision to not open new stores during the current fiscal year. The decreases were offset by an increase of $0.9 million in rent expense, primarily as a result of inflation, and a $1.8 million legal settlement during the 13 weeks ended November 2, 2024.
Previous report
On a per store basis, our payroll expense decreased approximately 3% compared to the corresponding period of fiscal year 2023. On a per store basis, our other operating expenses increased approximately 2% compared to the corresponding period of fiscal year 2023 as we increased marketing spend to help drive sales. As a percentage of net sales, selling, general, and administrative expenses increased to 30.8% of net sales in the third quarter of fiscal year 2024, compared to 29.4% of net sales in the third quarter of fiscal year 2023, as a result of the factors discussed above.
Previous report
Thirty-Nine Weeks Ended November 2, 2024 Compared to Thirty-Nine Weeks Ended October 28, 2023
Previous report
Net Sales and Same Store Sales. Net sales decreased by $60.4 million, or 6.6%, to $857.2 million during the 39 weeks ended November 2, 2024 compared to $917.6 million in the corresponding period of fiscal year 2023. Our net sales decreased primarily due to the continued impact of consumer inflationary pressures on discretionary spending, resulting in a decline in store traffic and lower demand across most product categories. This decrease was partially offset by same store sales growth in our Fishing department and our opening of 1 new store since October 28, 2023. Stores that have been open for less than 12 months and were, therefore, not included in our same store sales, contributed $30.8 million to net sales. E-commerce driven sales comprised more than 19% of total sales for the 39 weeks ended November 2, 2024. Same store sales decreased by 9.4% during the 39 weeks ended November 2, 2024 compared to the corresponding 39-week period of fiscal year 2023, primarily as a result of the factors discussed above that impacted net sales.
Previous report
Our Fishing department saw a net sales increase of $7.6 million during the 39 weeks ended November 2, 2024 compared to the corresponding period of fiscal year 2023 primarily driven by our reset of fishing inventory and the opening of 1 new store since October 28, 2023. Our Hunting and Shooting, Apparel, Footwear, Camping and Optics, Electronics, Accessories and Other departments saw net sales decreases of $31.4 million, $17.3 million, $14.4 million, $3.7 million and $1.2 million, respectively, during the 39 weeks ended November 2, 2024 compared to the corresponding period of fiscal year 2023. Within our Hunting and Shooting department, our ammunition and firearm categories saw decreases of $18.7 million and $12.6 million or 12.9% and 5.9%, respectively, during the 39 weeks ended November 2, 2024 compared to the corresponding period of fiscal year 2023. The decreases in the firearm and ammunition categories were primarily due to the impact of consumer inflationary pressures on discretionary spending. This was partially offset by our opening of 1 new store since October 28, 2023.
Previous report
Gross Profit. Gross profit decreased by $17.2 million, or 6.0%, to $266.9 million during the 39 weeks ended November 2, 2024 compared to $284 million for the corresponding period of fiscal year 2023. As a percentage of net sales, gross profit increased to 31.1% during the 39 weeks ended November 2, 2024, compared to 31.0% for the corresponding period of fiscal year 2023, primarily driven by increased product margins, versus last years Apparel and Footwear clearance events which put pressure on gross margin, partially offset by increased shrink.
Previous report
Selling, General, and Administrative Expenses. Selling, general, and administrative expenses decreased by $12.7 million, or 4.2%, to $288.7 million during the 39 weeks ended November 2, 2024, compared to $301.5 million for the corresponding period of fiscal year 2023. This decrease was primarily the result of decreases in payroll and pre-opening expenses of $11.6 million and $5.4 million, respectively, during the 39 weeks ended November 2, 2024 primarily related to our ongoing cost reduction efforts and decision to not open new stores during the current fiscal year. These decreases were partially offset by increases of $4.1 million and $2.1 million in rent and depreciation expenses, respectively, during the 39 weeks ended November 2, 2024 primarily as a result of opening 1 new store since October 28, 2023.
Previous report
On a per store basis, our payroll and other operating expenses decreased approximately 13% and 5%, respectively, compared to the corresponding period of fiscal year 2023. As a percentage of net sales, selling, general, and administrative expenses increased to 33.6% of net sales during the 39 weeks ended November 2, 2024, compared to 32.9% of net sales in the third quarter of fiscal year 2023, primarily driven by lower net sales.
Previous report
Interest Expense. Interest expense decreased by $0.1 million, or 1.1%, to $9.4 million during the 39 weeks ended November 2, 2024, compared to $9.5 million for the corresponding period of fiscal year 2023. The decrease in interest expense was primarily driven by decreased gross borrowings under our revolving credit and term loan facilities, partially offset by higher weighted average interest rates during the 39 weeks ended November 2, 2024 compared to the corresponding period of fiscal year 2023.
Previous report
Represents fees and expenses related to a settlement in the cancellation of a contract related to our information technology systems.
Previous report
Severance expenses paid as part of our cost reduction plan implemented during the 13 weeks ended July 29, 2023.
Previous report
Represents costs related to legal settlements and related fees and expenses.
Reworded paragraphs (25)
Previous wording
Our financial results and operations have been, and will continue to be, impacted by events outside of our control.
Current wording
Our financial results and operations have been, and will continue to be, impacted by events outside of our control. Global economic and business activities continue to face widespread macroeconomic uncertainties, including the impact of international trade policies and increased tariff rates, inflation, elevated interest rates, recession risks and rising global political tensions.
Previous wording
Global economic and business activities continue to face widespread macroeconomic uncertainties, including labor shortages, inflation and monetary supply shifts, elevated interest rates, recession risks and potential disruptions from the Russia-Ukraine conflict and rising global political tensions. Our results may also be impacted by the upcoming change in the presidential administration. In fiscal year 2023 and continuing into fiscal year 2024 our business was impacted by consumer inflationary pressures and recession concerns. As a result of our recent performance, we have taken steps to reduce our total inventory, implement cost reduction measures to reflect current sales trends and reduce investments in future new store openings. We currently do not plan to open any new stores for the remainder of fiscal year 2024 and we plan to open one new store in fiscal year 2025.
Current wording
In addition, since the beginning of fiscal year 2023, our business has been and continues to be impacted by consumer inflationary pressures and recession concerns. As a result, we have implemented cost reduction measures and reduced investments in future new store openings to reflect current sales trends. We did not open any new stores in fiscal year 2024 and we plan to open one new store in fiscal year 2025.
Previous wording
We continue to actively monitor the impact of these macroeconomic factors on our financial condition, liquidity, operations, suppliers, industry and workforce. The extent of the impact of these factors on our operational and financial performance, including our ability to execute our business strategies and initiatives in the expected timeframe, will depend on future developments, and the impact on our customers, partners and employees, all of which are uncertain and cannot be predicted; however, any continued or renewed disruption resulting from these factors could negatively impact our business.
Current wording
We continue to actively monitor the impact of these macroeconomic factors on our financial condition, liquidity, operations, suppliers, industry and workforce. The extent of the impact of these factors on our operational and financial performance, including our ability to execute our business strategies and initiatives in the expected timeframe, will depend on future developments, and the impact on our customers, partners and outfitters, all of which are uncertain and cannot be predicted; however, any continued or renewed disruption resulting from these factors could negatively impact our business.
Previous wording
In assessing the performance of our business, we consider a variety of performance and financial measures. The key measures for determining how our business is performing are net sales, same store sales, gross margin, selling, general, and administrative expenses, income from operations and adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”).
Current wording
In assessing the performance of our business, we consider a variety of performance and financial measures. The key measures for determining how our business is performing are net sales, same store sales, gross margin, selling, general and administrative expenses, income from operations and Adjusted EBITDA, which we define as net loss plus interest expense, income tax benefit, depreciation and amortization, stock-based compensation expense, transition and severance costs related to director and officer transitions, and expenses that we do not believe are indicative of our ongoing expenses.
Previous wording
We operate in a complex regulatory and legal environment that could negatively impact the demand for our products, which could significantly affect our operations and financial results. State, local and federal laws and regulations relating to products that we sell may change, sometimes significantly, as a result of political, economic or social events. For instance, in November 2022, the State of Oregon passed legislation that will, among other things, impose complex permitting and training requirements for the purchases of firearms. As a result, sales of firearms in Oregon may be halted or substantially diminished until such permitting and training programs are developed by the state, which may take a significant amount of time. If that were to occur, it could result in a substantial decline in our sales of firearms and related products and reduce traffic to our stores in Oregon, which could have a substantial impact on our sales and gross margin. A state court judge in Oregon ruled that the measure violates the Oregon state constitution. This ruling is currently being appealed in the Oregon Court of Appeals. The measure is also being challenged in a related case in federal court and is currently on appeal in the U.S. Court of Appeals for the Ninth Circuit. We currently operate eight stores in the State of Oregon.
Current wording
We operate in a complex regulatory and legal environment that could negatively impact the demand for our products, which could significantly affect our operations and financial results. State, local, and federal laws and regulations relating to products that we sell may change, sometimes significantly, as a result of political, economic or social events.
Previous wording
Opening new stores and acquiring store locations is also an important part of our long-term growth strategy. During fiscal year 2023, we opened 15 new stores. We have not opened any new stores in fiscal year 2024 and do not plan to open any new stores for the remainder of fiscal year 2024. We plan to open one new store in fiscal year 2025. We may deviate from this target if attractive opportunities are presented to open stores or acquire new store locations outside of our target growth rate.
Current wording
Opening new stores and acquiring store locations is also an important part of our long-term growth strategy. During fiscal year 2024, we did not open any new stores. We plan to open one new store in fiscal year 2025. We may deviate from this target if attractive opportunities are presented to open stores or acquire new store locations outside of our target growth rate.
Previous wording
expanding our omni-channel capabilities through larger assortment and inventory, expanded content and expertise and better user experience; and
Current wording
expanding our omni-channel capabilities through refined product assortment, expanded content and expertise and better user experience;
Previous wording
increasing our total gross square footage by opening new stores and through strategic acquisitions;
Current wording
increasing our total gross square footage by opening new stores; and
Previous wording
We believe the key drivers to improving our gross margin are increasing the product mix to higher margin products, particularly apparel and footwear, increasing foot traffic within our stores and traffic to our website, improving buying opportunities with our vendor partners and coordinating pricing strategies among our stores and our merchandise group. Our ability to properly manage our inventory can also impact our gross margin. Successful inventory management ensures we have sufficient high margin products in stock at all times to meet customer demand, while overstocking of items could lead to markdowns in order to help a product sell. During fiscal year 2023, we commenced an effort to reduce our inventory and initiated various strategic promotional efforts as part of this plan, which impacted our gross margins during fiscal year 2023. At the end of fiscal year 2023, we completed our inventory reduction plan. For fiscal year 2024, high inflation has continued to adversely impact our gross margins. We believe that the overall growth of our business can also help improve our gross margins, because increased merchandise volumes will enable us to maintain our strong relationships with our vendors. If we see significant declines in sales or increases in overstocked inventory, we may experience a decline in gross margins as we use promotions to drive traffic and reduce inventory.
Current wording
We believe the key drivers to improving our gross margin are increasing the product mix to higher margin products, particularly apparel and footwear, increasing foot traffic within our stores and traffic to our website, improving buying opportunities with our vendor partners and coordinating pricing strategies among our stores and our merchandise group. Our ability to properly manage our inventory can also impact our gross margin. We focus our buying on core items, high-turning products and seasonally relevant merchandise, particularly in ammunition, fishing, camping and personal protection, as these are areas where customer demand is more predictable and where having products in stock matters most to our customers. Successful inventory management ensures we have sufficient high margin products in stock to meet customer demand, while overstocking of items can lead to markdowns in order to help a product sell. This is especially true with respect to our more in demand inventory, with approximately 20% of our products accounting for approximately 80% of our net sales. Despite our decision to pull forward inventory purchases, we anticipate ending fiscal year 2025 with lower total inventory than fiscal year 2024.
Previous wording
We define Adjusted EBITDA as net (loss) income plus interest expense (benefit), income tax expense (benefit), depreciation and amortization, stock-based compensation expense, transition and severance costs related to director and officer transitions, and other gains, losses and expenses that we do not believe are indicative of our ongoing expenses. We define Adjusted EBITDA margin as Adjusted EBITDA divided by net sales. In evaluating our business, we use Adjusted EBITDA and Adjusted EBITDA margin as additional measurement tools for purposes of business decision-making, including evaluating store performance, developing budgets and managing expenditures. See “—Non-GAAP Financial Measures.”
Current wording
We define Adjusted EBITDA as net loss plus interest expense, income tax benefit, depreciation and amortization, stock-based compensation expense, transition and severance costs related to director and officer transitions, and expenses that we do not believe are indicative of our ongoing expenses. We define Adjusted EBITDA margin as Adjusted EBITDA divided by net sales. In evaluating our business, we use Adjusted EBITDA and Adjusted
Previous wording
With respect to same store sales, during the 13 weeks ended November 2, 2024, our Fishing and Optics, Electronics, Accessories and Other departments saw increases of 3.2% and 2.6%, respectively, compared to the corresponding period of fiscal year 2023. Our Apparel, Footwear, Hunting and Shooting and Camping departments saw same store sales decreases of 28.3%, 25.4%, 2.0% and 0.4%, respectively, during the 13 weeks ended November 2, 2024 compared to the corresponding period of fiscal year 2023. These changes were primarily driven by the items noted above for net sales. As of November 2, 2024, 145 stores were included in our same store sales calculation.
Current wording
With respect to same store sales, during the 13 weeks ended May 3, 2025, our Fishing, Apparel, Hunting and Shooting and Footwear departments saw increases of 11.0%, 5.6%, 1.5% and 1.4%, respectively, compared to the corresponding period of fiscal year 2024. Our Camping and Optics, Electronics, Accessories and Other departments saw same store sales decreases of 5.8% and 1.3%, respectively, during the 13 weeks ended May 3, 2025 compared to the corresponding period of fiscal year 2024. These changes were primarily driven by the items noted above for net sales. As of May 3, 2025, 146 stores were included in our same store sales calculation.
Previous wording
Gross Profit. Gross profit decreased by $0.1 million, or 0.1%, to $103.1 million during the 13 weeks ended November 2, 2024 compared to $103.2 million for the corresponding period of fiscal year 2023. As a percentage of net sales, gross profit increased to 31.8% during the 13 weeks ended November 2, 2024, compared to 30.3% for the corresponding period of fiscal year 2023, primarily driven by increased product margins in our Apparel and Footwear departments, partially offset by increased freight and shrink.
Current wording
Gross Profit. Gross profit increased by $1.9 million, or 2.5%, to $75.6 million during the 13 weeks ended May 3, 2025 compared to $73.8 million for the corresponding period of fiscal year 2024. As a percentage of net sales, gross profit increased to 30.4% during the 13 weeks ended May 3, 2025, compared to 30.2% for the corresponding period of fiscal year 2024, primarily driven by favorable mix and rate improvements in our fishing business, which carries a higher gross margin rate profile. This gain was partially offset by increased freight expense tied to our strategic inventory pull-forward in anticipation of higher tariffs and changes to international trade policy.
Previous wording
Interest Expense. Interest expense decreased by $0.6 million, or 15.4%, to $3.3 million during the 13 weeks ended November 2, 2024, compared to $3.9 million for the corresponding period of fiscal year 2023. The decrease in interest expense was primarily driven by decreased gross borrowings under our revolving credit and term loan facilities partially offset by a higher weighted average interest rate during the third quarter of fiscal year 2024 compared to the corresponding period of fiscal year 2023.
Current wording
Interest Expense. Interest expense increased by $0.1 million, or 3.4%, to $3 million during the 13 weeks ended May 3, 2025, compared to $2.9 million for the corresponding period of fiscal year 2024. The increase in interest expense was primarily driven by increased amortization of outstanding deferred financing fees and discounts related to the term loan facility during the first quarter of fiscal year 2025 compared to the corresponding period of fiscal year 2024.
Previous wording
Income Taxes. We recognized income tax benefit of $7.4 million during the 39 weeks ended November 2, 2024 compared to an income tax benefit of $6.7 million during the corresponding period of fiscal year 2023. Our effective tax rates during the 39 weeks ended November 2, 2024 and October 28, 2023 were 23.2% and 24.8%, respectively. Our effective tax rate will generally differ from the U.S. Federal statutory rate of 21.0%, due to state taxes, permanent items, and discrete items relating to stock award deductions.
Current wording
Income Taxes. We recognized income tax benefit of $1.3 million during the 13 weeks ended May 3, 2025 compared to an income tax benefit of $5.5 million during the corresponding period of fiscal year 2024. Our effective tax rates during the 13 weeks ended May 3, 2025 and May 4, 2024 were 5.9% and 23.2%, respectively. Our effective tax rate will generally differ from the U.S. Federal statutory rate of 21.0%, due to state taxes, permanent items, and discrete items relating to stock award deductions.
Previous wording
Net sales are typically higher in our third and fourth fiscal quarters than in our first and second fiscal quarters because of the openings of hunting seasons across the country and consumer holiday buying patterns. We also incur additional expenses in our third and fourth fiscal quarters due to higher sales volume and increased staffing in our stores. We anticipate our net sales will continue to reflect this seasonal pattern.
Current wording
Net sales are typically higher in our third and fourth fiscal quarters than in our first and second fiscal quarters because of the openings of hunting seasons across the country and consumer holiday buying patterns. We also incur additional expenses in our third and fourth fiscal quarters due to higher sales volume and increased staffing in our stores. We anticipate our net sales will continue to reflect this seasonal pattern. On average, over the last three fiscal years, we have generated approximately 26.4% and 28.0% of our net sales in the third and fourth fiscal quarters, respectively, which includes the holiday selling season as well as the opening of the Fall hunting season. We anticipate our net sales will continue to reflect this seasonal pattern. However, Spring hunting, Father’s Day and the availability of hunting and fishing throughout the year in many of our markets counterbalance this seasonality to a certain degree.
Previous wording
As of November 2, 2024, we had cash and cash equivalents of $2.7 million and working capital, consisting of current assets less current liabilities, of $75.8 million. We also had $148.1 million available for borrowing under our senior secured revolving credit facility and our term loan facility as of November 2, 2024, calculated based upon certain borrowing base restrictions for each of the revolving credit facility and term loan facility.
Current wording
As of May 3, 2025, we had cash and cash equivalents of $3.6 million and working capital, consisting of current assets less current liabilities, of $62.9 million. We also had $118.5 million available for borrowing under our senior secured revolving credit facility and our term loan facility as of May 3, 2025, calculated based upon certain borrowing base restrictions for each of the revolving credit facility and term loan facility.
Previous wording
Our primary cash requirements are for seasonal working capital needs and capital expenditures related to ongoing operational needs and new system investments. For both the short-term and the long-term, our primary sources of cash are borrowings under our senior secured revolving credit facility, our term loan facility and operating cash flows. We believe that our cash on hand, cash generated by operating activities and funds available under our revolving credit facility and term loan facility will be sufficient to finance our operating activities and meet our cash requirements for at least the next twelve months and beyond. With no new stores planned for the remainder of fiscal year 2024, and only one new store planned for fiscal year 2025, we intend to prioritize the repayment of outstanding debt with any excess cash flow.
Current wording
Our primary cash requirements are for seasonal working capital needs and capital expenditures related to ongoing operational needs and new system investments. For both the short-term and the long-term, our primary sources of cash are borrowings under our senior secured revolving credit facility, our term loan facility and operating cash flows. We believe that our cash on hand, cash generated by operating activities and funds available under our revolving credit facility and term loan facility will be sufficient to finance our operating activities and meet our cash requirements for at least the next twelve months and beyond. With only one new store planned for fiscal year 2025, we intend to prioritize the repayment of outstanding debt with any excess cash flow.
Previous wording
Operating Lease Obligations. Operating lease commitments consist principally of leases for our retail stores, corporate office and distribution center. Our leases often include options which allow us to extend the terms beyond the initial lease term. As of November 2, 2024, our expected operating lease payments for the remainder of fiscal year 2024 and fiscal year 2025 are $18.7 million and $72.8 million, respectively. Our total committed lease payments are $471.3 million. Other operating lease obligations consist of distribution center equipment. See Note 6, “Leases” to our unaudited condensed consolidated financial statements included in this 10-Q.
Current wording
Operating Lease Obligations. Operating lease commitments consist principally of leases for our retail stores, corporate office and distribution center. Our leases often include options which allow us to extend the terms beyond the initial lease term. As of May 3, 2025, our expected operating lease payments for the remainder of fiscal year 2025 and fiscal year 2026 are $55.9 million and $74.2 million, respectively. Our total committed operating lease payments are $465.2 million. Other operating lease obligations consist of distribution center equipment. See Note 6, “Leases” to our unaudited condensed consolidated financial statements included in this 10-Q.
Previous wording
Capital Expenditures. During the 39 weeks ended November 2, 2024, we incurred approximately $11.3 million in capital expenditures primarily related to strategic technological investments and general store maintenance. We expect capital expenditures, net of tenant allowances, between $17 million and $20 million for fiscal year 2024 (inclusive of amounts spent during the 39 weeks ended November 2, 2024) primarily related to strategic technological investments, such as planogramming, merchandising and replenishment and store scheduling tools, and general store fleet maintenance. We intend to fund these capital expenditures with our operating cash flows, cash on hand and funds available under our revolving credit facility. Other investment opportunities, such as potential strategic acquisitions or store expansion rates in excess of those presently planned, may require additional funding.
Current wording
Capital Expenditures. During the 13 weeks ended May 3, 2025, we incurred approximately $3.8 million in capital expenditures primarily related to strategic technological investments and general store maintenance. We expect capital expenditures between $20 million and $25 million for fiscal year 2025 (inclusive of amounts spent during the 13 weeks ended May 3, 2025) primarily related to strategic technological investments, such as planogramming, merchandising and replenishment and store scheduling tools, and general store fleet maintenance. We intend to fund these capital expenditures with our operating cash flows, cash on hand and funds available under our revolving credit facility. Other investment opportunities, such as potential strategic acquisitions or store expansion rates in excess of those presently planned, may require additional funding.
Previous wording
Principal and Interest Payments. We maintain a $350.0 million revolving credit facility and a $45.0 million term loan facility. As of November 2, 2024, $145.7 million was outstanding under the revolving credit facility and $25.0 million was outstanding under the term loan facility. Assuming no additional repayments or borrowings on our revolving credit facility and our term loan facility after November 2, 2024, our interest payments would be approximately $3.0 million for the remainder of fiscal year 2024 and approximately $12.0 million for fiscal year 2025, in each case, based on the interest rate as of November 2, 2024. As of November 2, 2024, our weighted average interest rate on the amounts outstanding under our revolving credit facility and term loan facility was 7.02%. See below under “Indebtedness” for additional information regarding our revolving credit facility and term loan facility, including the interest rates applicable to any borrowing under such facilities.
Current wording
Principal and Interest Payments. We maintain a $350.0 million revolving credit facility and a $45.0 million term loan facility. As of May 3, 2025, $155.5 million was outstanding under the revolving credit facility and $25.0 million was outstanding under the term loan facility. Assuming no additional repayments or borrowings on our revolving credit facility and our term loan facility after May 3, 2025, our interest payments would be approximately $8.9 million for the remainder of fiscal year 2025 and approximately $11.9 million for fiscal year 2026, in each case, based on the interest rate as of May 3, 2025. As of May 3, 2025, our weighted average interest rate on the amounts outstanding under our revolving credit facility and term loan facility was 6.59%. See below under “Indebtedness” for additional information regarding our revolving credit facility and term loan facility, including the interest rates applicable to any borrowing under such facilities.
Previous wording
Net cash used in operating activities was $18.7 million for the 39 weeks ended November 2, 2024, compared to net cash used in operating activities was $16.6 million for the corresponding period of fiscal year 2023, an increase of approximately $2.1 million. The increase in our cash flows used in operating activities was primarily driven by reduced net income during the 39 weeks ended November 2, 2024 compared to the corresponding period of fiscal year 2023.
Current wording
Net cash used in operating activities was $60.2 million for the 13 weeks ended May 3, 2025, compared to net cash used in operating activities was $34.7 million for the corresponding period of fiscal year 2024, an increase of approximately $25.5 million. The increase in our cash flows used in operating activities was primarily driven by increased inventory purchases during the 13 weeks ended May 3, 2025 compared to the corresponding period of fiscal year 2024 done in an attempt to reduce our exposure to tariffs.
Previous wording
Net cash used in investing activities was $11.3 million for the 39 weeks ended November 2, 2024, compared to net cash used in investing activities was $71.2 million for the corresponding period of fiscal year 2023, a decrease of approximately $59.9 million, which was primarily driven by reduced capital expenditures related to the construction of new stores and the refurbishment of existing stores during the 39 weeks ended November 2, 2024 compared to the corresponding period of fiscal year 2023.
Current wording
Net cash used in investing activities was $3.8 million for the 13 weeks ended May 3, 2025, compared to net cash used in investing activities was $3.3 million for the corresponding period of fiscal year 2024, an increase of approximately $0.5 million, which was primarily driven by increased capital expenditures related to the construction of a new store and timing of technical investments during the 13 weeks ended May 3, 2025 compared to the corresponding period of fiscal year 2024.
Previous wording
Net cash provided by financing activities was $29.4 million for the 39 weeks ended November 2, 2024, compared to net cash provided by financing activities was $88.3 million for the corresponding period of fiscal year 2023, a decrease of approximately $58.9 million. The decrease in cash provided by financing activities was primarily the result of decreased incremental borrowings under our revolving credit facility.
Current wording
Net cash provided by financing activities was $64.8 million for the 13 weeks ended May 3, 2025, compared to net cash provided by financing activities was $37.0 million for the corresponding period of fiscal year 2024, an increase of approximately $27.8 million. The increase in cash provided by financing activities was primarily the result of increased incremental borrowings under our revolving credit facility.
Previous wording
We maintain a $350.0 million revolving credit facility, with $145.7 million outstanding as of November 2, 2024. Our revolving credit facility is governed by an amended and restated credit agreement with a consortium of banks led by Wells Fargo Bank, National Association (“Wells Fargo”). We additionally entered into a term loan credit facility on July 30, 2024 with an aggregate principal amount available of $45.0 million, with $25.0 million outstanding as of November 2, 2024. Borrowings under our revolving credit facility and term loan facility are subject to a borrowing base calculation. As of November 2, 2024, we had an aggregate amount of $148.1 million available for borrowing under our revolving credit facility and our term loan facility, calculated based upon certain borrowing base restrictions, and $2.0 million in stand-by commercial letters of credit.
Current wording
We maintain a $350.0 million revolving credit facility, with $155.5 million outstanding as of May 3, 2025. Our revolving credit facility is governed by an amended and restated credit agreement with a consortium of banks led by Wells Fargo Bank, National Association (“Wells Fargo”). We additionally entered into a term loan credit facility on July 30, 2024 with an aggregate principal amount available of $45.0 million, with $25.0 million outstanding as of May 3, 2025. Borrowings under our revolving credit facility and term loan facility are subject to a borrowing base calculation. As of May 3, 2025, we had an aggregate amount of $118.5 million available for borrowing under our revolving credit facility and our term loan facility, calculated based upon certain borrowing base restrictions, and $2.3 million in stand-by commercial letters of credit. Our $20 million availability under our term loan was scheduled to expire on April 30, 2025 and we recently extended the expiration to July 31, 2025.
Previous wording
In evaluating our business, we use Adjusted EBITDA and Adjusted EBITDA margin as supplemental measures of our operating performance. We define Adjusted EBITDA as net (loss) income plus interest expense (benefit), income tax expense (benefit), depreciation and amortization, stock-based compensation expense, transition and severance costs related to director and officer transitions, and other gains, losses and expenses that we do not believe are indicative of our ongoing expenses. Net loss is the most comparable GAAP financial measure to Adjusted EBITDA. We define Adjusted EBITDA margin as, for any period, the Adjusted EBITDA for that period divided by the net sales for that period. We consider Adjusted EBITDA and Adjusted EBITDA margin important supplemental measures of our operating performance and believe they are frequently used by analysts, investors and other interested parties in the evaluation of companies in our industry. Other companies in our industry, however, may calculate Adjusted EBITDA and Adjusted EBITDA margin differently than we do. Management also uses Adjusted EBITDA and Adjusted EBITDA margin as additional measurement tools for purposes of business decision-making, including evaluating store performance, developing budgets and managing expenditures. Management believes Adjusted EBITDA and Adjusted EBITDA margin allow investors to evaluate our operating performance and compare our results of operations from period to period on a consistent basis by excluding items that management does not believe are indicative of our core operating performance.
Current wording
In evaluating our business, we use Adjusted EBITDA and Adjusted EBITDA margin as supplemental measures of our operating performance. We define Adjusted EBITDA as net loss plus interest expense, income tax benefit, depreciation and amortization, stock-based compensation expense, transition and severance costs related to director and officer transitions, and expenses that we do not believe are indicative of our ongoing expenses. Net loss is the most comparable GAAP financial measure to Adjusted EBITDA. We define Adjusted EBITDA margin as, for any period, the Adjusted EBITDA for that period divided by the net sales for that period. We consider Adjusted EBITDA and Adjusted EBITDA margin important supplemental measures of our operating performance and believe they are frequently used by analysts, investors and other interested parties in the evaluation of companies in our industry. Other companies in our industry, however, may calculate Adjusted EBITDA and Adjusted EBITDA margin differently than we do. Management also uses Adjusted EBITDA and Adjusted EBITDA margin as additional measurement tools for purposes of business decision-making, including evaluating store performance, developing budgets and managing expenditures. Management believes Adjusted EBITDA and Adjusted EBITDA margin allow investors to evaluate our operating performance and compare our results of operations from period to period on a consistent basis by excluding items that management does not believe are indicative of our core operating performance.
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Current report — wording carried from elsewhere
Gross margins may continue to be affected by the evolving implementation of these higher tariff rates. We believe that the overall growth of our business can also help improve our gross margins, because increased merchandise volumes will enable us to maintain our strong relationships with our vendors. If we see significant declines in sales or increases in overstocked inventory, we may experience a decline in gross margins as we use promotions to drive traffic and reduce inventory.
Current report — wording carried from elsewhere
EBITDA margin as additional measurement tools for purposes of business decision-making, including evaluating store performance, developing budgets and managing expenditures. See “—Non-GAAP Financial Measures.”
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Income Taxes. We recognized income tax expense of $0.2 million during the 13 weeks ended November 2, 2024 compared to an income tax expense of $0.5 million during the corresponding period of fiscal year 2023. Our effective tax rates during the 13 weeks ended November 2, 2024 and October 28, 2023 were -80.2% and -52.6%, respectively. Our effective tax rate will generally differ from the U.S. Federal statutory rate of 21.0%, due to state taxes, permanent items, and discrete items relating to stock award deductions.
Previous report — wording carried elsewhere
With respect to same store sales, during the 39 weeks ended November 2, 2024, our Fishing department saw an increase of 4.8% compared to the corresponding period of fiscal year 2023. Our Apparel, Footwear, Hunting and Shooting, Camping and Optics, Electronics, Accessories and Other departments saw same store sales decreases of 24.8%, 23.8%, 9.1%, 5.6% and 5.3%, respectively, during the 39 weeks ended November 2, 2024 compared to the corresponding period of fiscal year 2023. These changes were primarily driven by the items noted above for net sales. As of November 2, 2024, 145 stores were included in our same store sales calculation.