Big 5 Sporting Goods Reports 10.1% Decline in Net Sales and $69.1 Million Loss for Fiscal Year 2024

Big 5 Sporting Goods Corporation reported a significant decline in financial performance for the fiscal year ending December 29, 2024, with net sales dropping 10.1% to $795.5 million, down from $884.7 million in the previous year. The decrease in sales was attributed to a 9.4% decline in same-store sales, which the company linked to persistent inflationary pressures that dampened consumer demand for discretionary products. The company's gross profit margin also fell to 29.5% from 32.3% in fiscal 2023, reflecting increased costs associated with store occupancy and distribution expenses.

The company experienced a net loss of $69.1 million, or $3.15 per share, compared to a loss of $7.1 million, or $0.33 per share, in the prior year. This increase in loss was primarily due to lower net sales and a non-cash charge related to deferred tax assets. Despite the challenging financial landscape, Big 5 managed to reduce its selling and administrative expenses by 2.2% to $290.1 million, which represented 36.5% of net sales, down from 33.5% in the previous year.

Operationally, Big 5 closed 11 stores during fiscal 2024, reducing its total store count to 422 by year-end. The company has adopted a cautious approach to expansion, opening only three new stores while closing 11, and it anticipates closing an additional 15 stores in fiscal 2025. The average transaction size decreased slightly, and customer transactions fell by 7.8%, indicating a decline in consumer engagement. The company’s e-commerce sales remained immaterial, highlighting the ongoing challenges in adapting to the competitive retail environment.

In response to the economic pressures, Big 5 has focused on managing its inventory levels and reducing costs. The company reported a negative operating cash flow of $11.4 million for fiscal 2024, a stark contrast to the positive cash flow of $18.5 million in the previous year. As of December 29, 2024, Big 5 had $5.4 million in cash and $13.8 million in revolving credit borrowings, reflecting a shift in its liquidity position. The company suspended its quarterly cash dividend in the second half of fiscal 2024 to preserve cash amid these challenges.

Looking ahead, Big 5 anticipates continued difficulties due to inflation and changing consumer spending patterns. The company plans to focus on cost management and operational efficiency while navigating the competitive landscape of the sporting goods retail sector. The outlook remains cautious, with no new store openings planned for fiscal 2025 and a strategy centered on closing underperforming locations to stabilize its financial position.