Big 5 Sporting Goods(BGFV) - 2022 Q4 - Annual Report

Sales Performance - Net sales for fiscal 2021 increased by 11.6% to $1,161.8 million compared to$1,041.2 million in fiscal 2020[147] - Same store sales for fiscal 2021 increased by 13.9% compared to the prior year[147] - Net sales increased by $120.6 million (11.6$1,161.8 million in fiscal 2021, driven by a 13.9% increase in same-store sales[152] - Strong consumer demand in fiscal 2021, particularly for team sports products, contributed to higher sales and margins[162] Gross Profit and Margins - Gross profit for fiscal 2021 represented 37.5% of net sales, up from 33.5% in fiscal 2020[147] - Gross profit rose by $86.6 million to$435.8 million (37.5% of net sales) in fiscal 2021, with merchandise margins improving by 250 basis points[154] - Inflation in product purchase costs and freight costs in fiscal 2021 and 2020 led to adjustments in selling prices, with potential future impacts on merchandise margins if price adjustments cannot be maintained[195] Selling and Administrative Expenses - Selling and administrative expense for fiscal 2021 increased by 8.9% to $299.8 million, or 25.8$24.4 million (8.9%) to $299.8 million, primarily due to higher employee labor and benefit-related costs[155] Net Income and Earnings - Net income for fiscal 2021 was$102.4 million, or $4.55 per diluted share, compared to$55.9 million, or $2.58 per diluted share, in fiscal 2020[147] - Operating income grew to$136.0 million (11.7% of net sales) in fiscal 2021, up from $76.3 million (7.2$102.4 million (8.8% of net sales) in fiscal 2021, compared to $55.9 million (5.2$115.5 million, down from $148.7 million in fiscal 2020[148] - Cash and cash equivalents were$97.4 million as of January 2, 2022, compared to $64.7 million as of January 3, 2021[148] - Operating cash flows for fiscal 2021 were$115.5 million, a decrease from $148.7 million in fiscal 2020 due to increased inventory funding[165] - Cash and cash equivalents at the end of fiscal 2021 were$97.4 million, up from $64.7 million in fiscal 2020[161] - Financing cash flows for fiscal 2021 were a negative$72.1 million, primarily used for dividend payments, treasury stock purchases, and finance lease payments[168] - As of January 2, 2022, the company had no revolving credit borrowings and letter of credit commitments of $1.1 million outstanding, compared to$2.6 million as of January 3, 2021[169] Capital Expenditures - Capital expenditures for fiscal 2021 increased to $10.9 million from$7.3 million in fiscal 2020[148] - Capital expenditures in fiscal 2021 were $10.9 million, primarily for store remodeling, new store openings, and distribution center equipment[166] - Capital expenditures for fiscal 2021 totaled$10.864 million, including $5.381 million for store-related remodels and$2.727 million for new stores[167] - The company expects capital expenditures for fiscal 2022 to range from $15.0 million to$20.0 million, primarily for new stores, store-related remodeling, and distribution center equipment[183] Dividends and Share Repurchases - The company paid cash dividends of $61.8 million in fiscal 2021, up from$5.5 million in fiscal 2020[148] - The company repurchased 361,323 shares of common stock for $7.6 million in fiscal 2021[148] - Quarterly cash dividends increased from$0.05 per share in fiscal 2020 to $0.25 per share in fiscal 2021, with special dividends of$1.00 per share declared in the second and fourth quarters of fiscal 2021[170] - The company repurchased 361,323 shares of common stock in fiscal 2021, totaling $49.4 million since the inception of the share repurchase program in May 2006[172] - Annual cash dividends paid in fiscal 2021 were$2.83 per share, including special dividends of $2.00 per share, compared to$0.25 per share in fiscal 2020[185] - A new share repurchase program of up to $25.0 million was authorized in the first quarter of fiscal 2022, replacing the previous program[186] Tax and Financial Commitments - The effective tax rate for fiscal 2021 was 24.2$150.0 million, with a $50.0 million sublimit for letters of credit[174] - Operating lease commitments include retail store facilities, distribution centers, and corporate offices, with options to extend terms and renegotiate upon expiration[187] Inventory and Seasonal Fluctuations - Inventory valuation reserves for damaged, slow-moving, or obsolete merchandise totaled$2.7 million as of January 2, 2022, and $3.5 million as of January 3, 2021, representing approximately 1$0.3 million change in reserves and pre-tax earnings[192] - Seasonal fluctuations in net sales impact buying patterns, merchandise levels, and cash flows, with higher inventory purchase volumes and expenses in the fourth fiscal quarter[194]