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Dick's Sporting Goods announced Tuesday the removal of 125 firearms from its stores, which allowed it to withdraw from the category after the shooting at schools in Parkland, Florida, which resulted in changes of the company's policy.
The sporting goods retailer stopped selling firearms in 10 stores last year to test its performance. Now, the store has decided to remove the firearms from 125 additional stores after seeing positive sales. Dick's has more than 700 stores in the United States.
The retailer plans to regionalize its store strategy by replacing hunting items with less-sold items, such as clothing, sports shoes or outdoor equipment. Dick's CEO, Ed Stack, said Tuesday in a call for results to analysts that he was analyzing categories "based on the needs of that particular market".
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Stack said the changes would be completed by the end of the year and that the company plans to launch a multi-year initiative based on store performance.
"If everything goes as planned, we would probably have another batch of stores next year," Stack said in his call for results on Tuesday.
The announcement came after a slump in fourth-quarter sales and a low earnings forecast on Tuesday morning, which brought down Dick's shares. Shares in the sporting goods store fell 11.2% on Tuesday to a close price of $ 34.61.
Dick reported net income of nearly $ 103 million, down from $ 116 million the year before. The report has met Wall Street's expectations of a $ 1.07 earnings per share, according to analysts surveyed by Zacks Investment Research.
The company based in Coraopolis, Pennsylvania, also recorded a business turnover of $ 2.49 billion during the period, exceeding Street's forecast. Seven analysts surveyed by Zacks were expecting $ 2.48 billion. But that represented $ 2.66 billion a year earlier.
Whatever the case may be, sales in stores open at least a year, an essential measure for retailers, have dropped by just over 2%.
Stack made the public decision to stop selling firearms to customers under the age of 21 and to stop selling assault-style weapons after the shooting that took place at Parkland High School last February. The store had legally sold a shotgun rifle to the school Parkland Nikolas Cruz in 2017, although the weapon in question was not used during the shooting.
The company's new policy has provoked a fierce reaction from gun advocates to its consumers, making the industry already in decline a drag on the retailer. In its annual results report, the company reported that its hunting and electronics categories together accounted for the drop in same-store sales.
"If they removed the hunting category, they would not lose as much as they would win in other categories," said Joseph Feldman, chief executive of Telsey Advisory Group.
Dick's also announced plans to improve store experience and focus on online sales.
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