Sportsman's Warehouse hunting for more customers

The CEO of Sportsman's Warehouse Holdings Inc. blamed traffic problems and lower prices of firearms for the company’s drop in same store sales in the first quarter.

Net sales increased by 9.1% to $144.5 million from $132.4 million in the first quarter ended May 2. Same store sales decreased by 0.7%.

“Looking more closely at our comparable store sales performance for the quarter, we saw a reduction in average selling price on firearms in the first quarter, and customers also moved toward more mid-priced product and vendors increased production of these products,” said John Schaefer, CEO, said in a conference call with investors. “Specifically, average selling price in firearms decreased 3.3% during the quarter and unit increases of 1.4%. Traffic on the same-store basis or more specifically customer frequency remains negative. While February and March continued the warmer than normal weather pattern and resulted in negative comps in clothing and footwear, we did see the positive impact of this dynamic in our fishing and camping categories.”

Income from operations increased to $1.2 million from a $0.2 million loss in the first quarter of fiscal 2014. Adjusted income from operations, which excludes expenses related to bonuses paid as a result of an IPO.

“Looking at the remainder of the year,” Schaefer added, “we remain focused on our strategic growth initiatives and key priorities including capitalizing on the significant white space opportunity for new stores, maximizing the potential of our loyalty program, continuing to emphasize our best-in-class customer service and enhancing operating margins through increased sales of our private label products."

The company ended the quarter with 57 stores in 18 states, a unit increase of 14.0% from the end of the first quarter of fiscal 2014.