Hibbett Inc (HIBB) 2011 Q3 法說會逐字稿

Good day, everyone, and welcome to Hibbett Sports conference call. Today's call is being recorded.

At this time for opening remarks and introductions, I would like to turn the conference over to Executive Chairman, Mr. Mickey Newsome. Please go ahead, sir.

Thank you, operator. And good morning, everyone. With us also today is our President and CEO, Jeff Rosenthal, Gary Smith, our Senior VP and CFO, Cathy Pryor, our Senior VP of stores, Becky Jones, our Senior VP of Merchandise and Marketing. We appreciate you being on our call today. We appreciate your interest in Hibbett Sporting Goods.

Before we start, Gary Smith will cover the Safe Harbor language.

In order for us to take advantage of Safe Harbor rules, I would like to remind you that any projections or statements made today reflect our current views with respect to future events and our financial performance. There is no assurance that such events will occur, or that any projections will be achieved. Our actual results could differ materially from any projections, due to various risk factors, which are described from time to time in our periodic reports with the SEC.

Thank you, Gary. Now our President and CEO, Jeff Rosenthal, will speak with you.

As you know from our press release this morning, our third quarter's earnings per share were $0.44 versus $0.30 a year ago, a 45% improvement. Overall sales for the third quarter were up 14.8%, and same store sales were up 12.5% for the quarter. Hibbett has achieved three consecutive quarters of double-digit comparable store sales growth. Sales by month were, August up 13.4%, September up 13.45%, and October up 9.45%.

Our operation team has continued to increase our customer service, with the numbers of items per transaction up 1.36%. The selling price per item is slightly down. However, our dollar per transaction is up. We are getting more traffic per door.

We are continuing to improve our customer experience with key vendors. New in-store shops from Nike and Under Armour have proven to be valuable additions to our sales. Our investment to technology continues to pay off. We are satisfying more customers with our in-stock position, and assortments specific to each store.

For the quarter, we opened 17 new stores, and only closed two, bringing the store base to 789 in 26 states. For the full fiscal 2011, the Company expects to open 40 to 42 new stores, compared to a previous estimate of 30 new stores. We also plan to expand 18 high performing stores.

New stores are performing above pro forma. We still have identified 400 additional smaller markets in our 26 state area. We are prepared to grow over 1,200 stores in our existing 26 states.

The first 19 days are positive 19% on a comp store basis. We all know that the comps on Thanksgiving and Christmas are very important to the fourth quarter. Even though we are going against tougher comparisons in the fourth quarter with Alabama National Championship and New Orleans Saints Super Bowl championships, we feel that we're in great position to take advantage of the fourth quarter.

Thank you, Jeff. Now Becky Jones, our Senior VP of Merchandise and Marketing, will speak with you.

We're pleased with the sales performance across all merchandise categories for the third quarter, and I'll spend some time talking about three categories, apparel, equipment and footwear.

In apparel, we break it out in two categories, active and license. Our activewear was up mid-teens, driven by branded products, Nike, Under Armour and The North Face, with shorts and tees being top performing key items. License was up in the low 20 percentile with college, Major League Baseball, NBA specifically showing strength. College was good across all genders, up mid-teens, and driven by strong team sales, Auburn, Alabama, Oklahoma and Arkansas, just to name a few.

Major League Baseball was very strong, and we had a nice pop at the end of the quarter with the Texas Rangers having a positive impact, due to the World Series. The NBA had good growth as well, with new LeBron and John Wall products most important.

Our accessory business remained strong with socks, shoe care and backpacks driving results. Our replenishment continues to support sales with strong in-stocks in the stores, and our top performing vendors were Phiten, Oakley and Accessory Brands.

The equipment business was up low double digits, with football driving the category. Baseball and soccer were also good performers. Top performing vendors were Wilson, McDavid, Shock Doctor and Easton. The fitness category was weak due to our strength in TV items being less impactful in the quarter.

Footwear and cleats had a very strong performance for the quarter, performing in a high single digit comp range. Top performing vendors were Nike, Reebok and Asics. Lightweight running and basketball were good across all categories in footwear. Men's footwear was up low double digits, women's footwear up low double digits, and kids' footwear up high single digits for the quarter. Toning continues to add incremental sales to the women's footwear business.

Our aged inventory is in good shape, and the fourth quarter looks promising on solid assortments across categories in apparel as well as footwear. We have strong fleece programs. Our outdoor products and better allocations with penetration of key items to our stores will have a positive impact for the rest of the year.

Thank you, Becky. Now Gary Smith, our Senior VP of Finance, will speak with you.

Thank you. As Jeff mentioned, third quarter sales were $167.4 million, a 14.8% increase from the previous year. Fiscal comps were up an industry-leading 12.5% for the third consecutive quarter of double-digit gains.

Gross profit rate expanded 125 basis points, on top of a 72 basis point improvement in the previous year. Three-quarters of the improvement was due to the leveraging of occupancy and warehouse, and the remainder of the increase was in product margin rate, as age and shrinkage rates improved, and we were less promotional.

SG&A expenses grew less on a per store basis than it did in the second quarter, and leveraged favorably 78 basis points. Depreciation and amortization was under last year's dollars, due to declining leasehold improvement dollars, as it cost us significantly less to get into a store.

Operating income improved 244 basis points to 12%, and $20.1 million versus last year's 9.6% and $13.9 million. This was on top of a 97 basis improvement in the prior year. Diluted EPS came in at $0.44 versus last year's $0.30, a plus 45% improvement, and the fourth consecutive quarter of plus 40% EPS growth.

A couple of important call-outs on a year-to-date basis. Comp store sales were up 13%. Total sales up 15.3%. Gross profit up 195 basis points. Expense lines levered over 120 bips, and operating income was over 320 basis points, and up over 60% plus. EPS was up over 60%, and $0.44 greater than last year. And we passed last year's annual earnings and EPS in the third quarter.

From a balance sheet perspective, the Company ended the quarter with $52.5 million in cash versus $24.8 million last year, with zero bank debt. Inventories increased 4% over the previous year, but were slightly up on a per store basis.

We spent $6.5 million in CapEx for the year versus a $10.3 million budget. And the Company purchased over 1.0 million of its own shares in the quarter for $25 million, and for the year, the Company has purchased over 1.2 million shares at over $30 million. We have approximately $220 million left under the remaining purchase authorization.

Thank you, Gary. Operator, we are now ready for questions.

Thank you. (Operator Instructions). Our first question comes from the line of Dan Wewer from Raymond James. Please proceed.

Thanks. Good morning.

Good morning.

So, Gary, in the last conference call I believe you were asked the question regarding the fourth quarter sales outlook, and at that time you noted how strong the business was a year ago, and you were talking about flattish same store sales. Now we're thinking about mid single digit increases. What's changed on your thoughts on the fourth quarter compared to three months ago?

That probably should be directed to Jeff or Becky. But we're up so strong in November, at 19%, and if you extrapolate some of those run rates through December and January, the math sort of works in the mid single digit. I think we're just being a little conservative, not really expecting to have a double-digit third, and starting off the fourth quarter at close to 20% is something we never saw in the tea leaves.

Well, Becky, let me ask you this. When you look at the difficult year-over-year compares in the fourth quarter, obviously that continues for the three quarters after that. Are you all thinking that this mid single digit growth could sustain itself through the first half of 2011?

Dan, we feel like we're in a great position. We see lots of opportunity still out there, and what we've done from an assortment base and allocation base, and really improving in operations and with some of our new technology, we really feel like we could continue to have a pretty good run.

Dan, the footwear industry in general is on a pretty good roll now. That's going to help Hibbett in the fourth quarter, and probably help us all next year.

And just as my follow-up question, thinking about the big sales growth that you're achieving with very minimal increase in your inventory per store, is that the benefit of the replenishment and allocation technology that you had invested in a few years ago? Or is it something else that's -- ?

Well, Dan, I think that's part of it. Definitely on the replenishment side. The other probably big factor is that our aged inventory is much cleaner than it was at this time a year ago. So we're able to work with less inventory, just because we're not carrying as much aged also. So we're also flowing our goods much better than we have in the past.

Okay. Great. Well, thank you.

Thank you.

Thank you. And our next question comes from the line of Jessica Bornn from Sterne, Agee. Please proceed.

Hey, it's Sam Poser, how are you?

Oh, good.

Well, I just was waiting to log on, and I was late getting on the call. Sorry about that. Anyway, just a couple of questions. Number one, you're stepping up the store opening. What brought that on, and how should we think about stores looking ahead into next year? Is this new developments or is this Movie Gallery, Blockbuster situations?

We did open quite a few more Movie Galleries. I believe we have 18 to 20 of those for right now. We've already opened seven of those stores. So that definitely helped.

We do expect to open more next year than we did this year. So, feeling a little bit better about that, but the Movie Gallery definitely helps.

Sam, the Movie Gallery thing is going to help us again next year and probably the year after. There's not much new construction going on in these small markets. I just got back from the Atlanta shopping center convention, and there's just not much going on.

But with the Movie Galleries and Blockbusters, we think we can increase the store growth.

So I mean, next year, can we go net 50? Is that a reasonable number?

Right now --

Next year.

We're not going to put that out until March.

All right. And then you've been -- on your e-commerce business, you've been doing it mostly as driving people to other people's websites. Where do you stand -- where are you in sort of the evolution of the e-com business?

Sam, we're a few years away. One of our initiatives is to put broadband in all our stores, and before we can really approach e-commerce, we need to get that done. So we're a few years away from e-commerce from not doing it from an affiliate standpoint.

And then lastly, on the merchandise margin improvement, can you sort of talk about the merchandise mix versus the less markdowns? And also, can you give us where you are on replen right now as a percent to total sales or a percent to total units on replen?

Sam, our merchandise margin actually improved based off of being a little bit more strategic around our promotions this past quarter, and really taking a look at what was necessary to drive sales. We found that because we were in a nice sales roll, that we just didn't need to go that deep. So we actually deployed that kind of markdown, if you would, into cleaning up the aged, so that we would be really healthy going into the fourth quarter.

And what was the second part?

Percent of E3.

E3, it hasn't changed really from where it was the last time that we talked. It's probably in the high 20% overall for our business.

Thank you. Then I'm sorry, one more. On the 19% comp that you're running, what are you up against for the first 19 days of last year? I mean, what is that comp anniversarying?

Basically flat, Sam.

Well, thank you. Continued success.

Thank you.

Thank you. Our next question comes from the line of David Magee from SunTrust Robinson Humphrey. Please proceed.

Thank you, and terrific quarter, guys.

Thank you.

Jeff, can you talk a little bit about what sort of products you might see next year come into the fold, maybe in the spring, that might help in terms of those tougher comparisons? Do you have any more potential on the outdoor side or any other category?

Yes, especially in the footwear realm. We are adding some other brands that we haven't carried before, so we see some potential there from outdoor sandals and that type, so we definitely see some categories that we haven't been in fully. Women's sandals, we have some opportunities from what we learned this past year. So we still see some categories that we haven't fully developed yet.

Thanks, Jeff. And Gary, also with regard to next year, do you see an opportunity, as some others have talked about in terms of maybe better vendor terms in 2011?

Yes, I would think so as we start getting scale, and becoming a little more important to them, and it's an evolving process, and I think our performance and our reach into these smaller markets just shows how important we are to them. So we would expect an uptick.

Is your 5% fourth quarter comp predicated upon the Falcons winning the Super Bowl?

It does not. But Mr. Newsome's probably going to address maybe the college part.

Thanks, and good luck.

Thank you.

Thank you. Our next question comes from the line of Rick Nelson from Stephens. Please proceed.

Thank you. Good morning. My congratulations as well.

Thank you, Rick.

What is driving the strength in the early fourth quarter? Is it still apparel and footwear? And is the outerwear area in fact kicking in?

You know what, Sam, our business across the board is pretty strong right now. It's across all categories. So we're seeing a nice uptick in footwear continuing. Apparel is still very good, as well. It's really attributed to a couple things.

The outdoor piece is working very nicely, and we have very nice, strong fleece programs from both Nike and Under Armour that are performing.

Gross margin, Becky, of 35.3% looks like a record for the third quarter as we go back in history. How are you thinking about that as we move into Q4, and how do you think about promotions?

I realize things have been pretty subdued in the sector from that standpoint. Do you think more of the same as we look forward?

Yes, Rick, we would expect in the fourth quarter to get 75 to 100 basis points leverage, probably mid to high single digit comps, and we would expect to see some product margin rate improvement also.

If I could ask also about capital allocation, you're sitting on $52 million in cash and no debt, sounds like the store opening, the financing from developers, those challenges are still out there. How do you rank the priorities today, and is a dividend in the cards at all?

Yes, I think our preference is to keep a safe level of cash. The second would be to continue the buyback, especially with the HIBB shares at this price, and from time to time we do talk about a dividend, but I would think it would be low on the totem pole.

Okay. Good. Thanks, and good luck.

Thank you.

Thank you. Our next question comes from the line of Mark Mandel from ThinkEquity. Please proceed.

Thank you. Good morning, and congratulations.

Thank you.

I just wanted to drill a little bit deeper into the expense line. How should we be thinking about the fourth quarter in terms of growth on a per store or per square foot basis?

And relatedly, what do you see as the comp leverage point?

Well, fourth quarter we should see a more favorable comparison on expense growth on a per store basis. If you remember, last year is when we really made the whole year, and that's where we had the catch-up bonus accrual. So we've been fighting that through three quarters, basically, and we will have a more favorable comparison on that in the fourth quarter, and then leverage in the fourth quarter on an SG&A basis should be in the 2% to 3% range.

Okay. Great. And how about for next year, where do you see the comp leverage point going next year?

In that 2.5% range.

Okay. Great. Are you seeing any -- are you worried at all about the increase in cotton prices?

We've seen a little bit of that. We don't really sell a ton of cotton, so we really don't think overall it will have a major impact to us, but we have seen some things for spring on cotton prices.

And you think you'll be able to pass those price increases on through?

Yes, it's such a minimal part of our business.

Okay. Great. Well, have a great and happy holiday season.

Thank you.

Thank you. Our next question comes from the line of Peter Benedict from Robert W Baird. Please proceed.

Hi, guys. A couple questions. First, on the inventory, obviously very lean versus the comp momentum here, doing a good job there. What should we think about inventory at the end of this year? Where do you see it flushing out?

It's going to be up slightly on a per store basis, and we're doing that strategically because February's a very important month for us from a sales perspective. So we did look at what we could bring in in January to continue to support our February business.

Okay. Thanks. And then bigger picture, your peak EBIT margin's around 12%, and it looks like this year you're going to get pretty close to that, maybe mid-11%s or so. Can you talk about the longer term opportunity there, assuming you go beyond peak?

What do you think the drivers are there? Is it more gross margin expansion, or the leverage of the fixed expenses? And within that, remind us where you are in your selling margins versus peak. Are they still depressed versus peak?

Peter, I think certainly we think we can get another couple hundred basis points in gross margin expansion, especially in some of the systems we're looking at. I would think that Hibbett's is good enough in these small town markets that we ought to have at least a 5% comp, and when we have that, a lot of good things happen to us.

And then our store growth rate starts ramping up, and our new stores are doing much better than they have in the last couple of years. So I wouldn't be surprised if we don't get very close to our peak EBITs depending on what happens this fourth quarter, and if we have a mid single digit next year, we could get over that number. So a lot of things are going very well with us right now.

Great. Thanks, Gary.

Thank you. Our next question comes from the line of Sean McGowan from Needham & Company. Please proceed.

Thank you. Also have a couple of questions. Maybe this is the shortest one. Is there anything weak in the revenue line?

Urban fashion apparel.

Yes.

That's true.

But as planned.

The old bugaboo. That's been that way for a while, right?

Yes.

Okay. Relating back to an earlier question, what you're comping against right now with that 19%, when does that get particularly hard? When did the license stuff really start to ramp up last year?

First week of December.

Okay.

After Alabama won the SEC championship game.

Okay. On Movie Gallery, how many -- remind us of how many stores are -- not just how many Movie Galleries were there, but how many would you call potential Hibbett targets in the aggregate?

We don't have a specific number, but there's a lot of them. There's hundreds of Movie Galleries that closed, and a lot of them were in small markets, and a lot of them are great real estate and a great size. I don't know that we have a specific number.

Okay. Thanks. Another one, is there anything that we need to be aware of kind of in the near term horizon regarding weather, either stuff that's happening now versus a year ago, or unusual things that happened a year ago in your markets?

Yes, last year was the best of all years, weather, teams winning and so forth. So we had beneficial weather last year, for sure.

Okay. So that's something maybe to be on the lookout for. And then finally, Gary, is there anything -- or maybe Becky. Is there anything that you would say in the gross margin now that might -- a benefit that might be unsustainable, anything that's sort of unusually strong that might not endure?

I don't really see anything that's at risk in that respect from a product margin perspective today.

I'm poking around for negatives. Not finding them. Okay. Thank you very much.

Thank you.

Thank you. Our next question comes from the line of Anthony Lebiedzinski from Sidoti & Company. Please proceed.

Good morning.

Good morning.

What is next on the IT system agenda? Can you talk about that? And also, when would you expect to implement -- I think you guys were talking about price optimization at some point, so can you talk about some of the IT initiatives that we should be on the lookout for?

The big ones for next year that we have in CapEx are time and attendance, broadband roll out to all 800 stores, and price optimization.

Got it. Okay. And also was wondering if you've seen any impact from freight costs, some retailers have talked about that. Are you seeing -- what are you seeing in freight costs?

We're seeing an uptick in in-bound freight, and some in outbound freight. Double-digit comps tends to mitigate that.

Sure. And then as far as North Face, can you talk about how many stores you plan to have that this year versus last?

We've expanded it quite a bit. We really don't give the numbers out, and we expect to grow it again significantly next year. So it's been a very good vendor to us, and we expect the outdoor piece of our business, not just from an apparel standpoint, to be important, but also the footwear piece. We also have added Columbia, and we would look to add other vendors as we go along.

Okay. Thank you.

Thank you.

Thank you. Our next question comes from the line of Mitch Kaiser from Piper Jaffray. Please proceed.

Thanks, guys. First of all, for Mickey, are you going to bet on the Iron Bowl coming up next weekend? I guess are you going to bet with your pocketbook or with your heart?

Well, I'm an Alabama fan, but we realize Auburn -- to sell more merchandise, we need Auburn to win and win the National Championship, but it's really hard for me to think that way.

Understood. I guess just a couple things. Could you tell us the stock comp number for the quarter, Gary? If you have that, if not, that's --

Give or take, it was $1.3 million.

Okay. And then just could you comment a little bit about the toning category. It still seems like you're somewhat optimistic about that, and I know that you had some decent plans heading into Q4. Could you just talk about kind of what you're seeing there, and kind of what your expectations for that category might be? Thanks.

We look at the toning category as an incremental opportunity in women's footwear. It's going to be in more doors, and is in more doors now than it was a year ago, so we expect it to add to the women's business as an overall. But in the aggregate when you look at the total women's business, it's the core product that's really driving the business as a complete comp. And those areas, specifically performance footwear, are really what's driving the business.

So what we intend to get, and have budgeted to get for toning in the fourth quarter is going to be a nice incremental for us, but we're not expecting it to be the one that we hang our hat on to make the quarter for us.

Okay. Got you. And then Gary, you intimated that it's a possibility you could do mid single digit comps next year. Obviously, you have got difficult compares given the excellent performance this year. Is it the momentum from the footwear category? How should we be thinking about that?

All of our categories are really smoking with apparel being up double digits, accessories was up 20% versus being up 20% quarter after quarter, year after year. We're starting to get back to some of the same levels we were in 2007 and 2008. So it's not like we're in uncharted territory, and we're a much better fundamental Company than we were two or three years ago. Besides that, Becky's here.

Sounds good, guys. Good luck. Thank you.

Thank you.

Thank you very much. Our next question comes from the line of Chris Horvers from JPMorgan. Please proceed.

Thanks, and good morning. Can you talk about how you think about your merchandise margins, maybe sequentially, 3Q to 4Q, given your expectations on the apparel versus footwear mix?

We were pleasantly surprised with our product margin rates in the third quarter. Last year at this time, the footwear comps were negative, and we were moving through some inventory, and now they're double-digit, and the footwear margins are the lowest of our three categories.

So to have a double-digit gain in footwear and still improve product margin rate, I think the merchants did a great job, and as Jeff and Becky said, our age is so much better and we didn't have to anniversary comp promotional events.

And then moving into fourth quarter, I don't think we've ever been as good a shape as we are now with aged merchandise and product flow and new product innovation. So, it's full steam ahead.

And so -- Becky, so as you think about the new products on the outdoor side that you're bringing in, is there a relative weight on the footwear and the boot side, versus the actual apparel side? Is it more dominated by apparel?

It is. But that's because we've had a little bit more history on the apparel side from The North Face that we've had in the stores. So that being said, it's a little bit stronger.

This is our first real step into an outdoor footwear program of any kind of significance. And even at that, it's not going to be the driver for the total sales. It's going to be a learning time period for us. We'll take what we get out of it this year, and then we'll apply those learnings to see how we approach that business for next year.

And then some of the new Columbia technology like Omni-Heat, is that something that will be in the stores?

We have a little bit of it in the stores right now. Columbia is in a limited number of doors this fall for us. And again, it's going to be a learning for us as well, what markets does that work best in. And we'll go from there and decide what makes sense for next year from a Columbia outerwear perspective.

And then lastly, Gary, could you refresh us what the catch-up bonus was in 4Q 2009 dollars?

Yes, I think it was anywhere from $0.75 million to $1 million.

Okay. Thank you.

Thank you.

Thank you. Our next question comes from the line of Jonathon Grassi from Longbow Research. Please proceed.

Good morning. Could you guys just remind us how much of the 9.6% comp last year was attributed to the college licensing products, and to weather?

Really about a third of our sales came from the Alabama and Saints, and weather it would be hard to say. It was just -- it was a pretty cold fourth quarter, but about a third of our comp from last year came from that.

Okay. And then looking beyond and into the first quarter and second quarter, I guess if there's any way you could quantify or qualify, how much of the improvement that we saw was attributed to the E3 system just allowing you guys to meet demand as opposed to chasing it, and how much of it would you attribute to just favorable product trends?

I think there's a little bit of both. Definitely the innovation, especially from a footwear standpoint, has been much stronger than it probably has been in two or three years, and I think it continues into next year. From a replenishment, we continue to get good comp out of our replenishment items.

We also added a piece last year called seasonal profiling, which helped us replenish really based off of different types of information such as seasons or weather and stuff like that. We're starting to see some increases there. It kind of gives us the exceptions. So we stay in stock a lot more in the right places. So continues to increase, and we expect it to increase quite a bit again next year.

Okay. And then how much does December revenue account for the total fourth quarter revenue?

It's a little over 50%.

Okay. And then what can you guys attribute to the new stores outperforming the older stores?

Well, internally we made lots of changes, the way we approach new stores. We looked at how we manage it, how we go to market. We've made a lot of different management changes from how do you assort the store, to how much allocation do you put.

We are also approaching it from a marketing standpoint a lot differently. And also, even from an operational standpoint, making sure we have the right managers and trained. And so we just have made it as one of our top priorities in the Company, and we've been much better for it.

Okay. Great. Thank you.

Thank you.

Thank you. And our next question comes from the line of Chris Svezia from Susquehanna. Please proceed.

Good morning, everyone. Great job. I just have one question, most of my questions were answered. But historically over the past couple years when you guys have put the outdoor presentation into your stores, can you just describe what you've seen in those stores in terms of how they've comped, what their performance has been once that package has been put in place?

Yes. They've comped probably 14%, 15% range. Even last quarter, on going against the same outdoor versus outdoor a year ago, they were still up double digits. So positive impact both years that we've had it.

And then for a brand-new store, we would expect somewhere in the 20% comp range could help the stores that much. So very, very positive.

Okay. Great to hear. Best of luck, and congratulations. Thanks, guys.

Thank you.

Thank you. And we have a follow-up question from the line of Sam Poser. Please proceed. From Sterne Agee.

My question was answered. Thank you. Good luck again.

Thank you, Sam.

Thank you. And we have a follow-up question from the line of Mark Mandel from ThinkEquity. Please proceed.

Thank you. Just on the real estate front, given the merchandising opportunities that you have, and the fact that you're expanding in a number of high performing stores, how are you thinking about your store prototype on a going forward basis? Are you thinking perhaps something somewhat larger than your existing base makes sense? How do you view that?

We are. We think there's a lot of opportunity to open a little bit larger store than we have in the past. We're also looking about at how do we visually merchandise it. A lot of times, it's not really adding inventory; it's just the visibility and being able to present your products better. So we're doing a lot of studies on that.

But I believe that we can open a little bit bigger stores than we have in the past. And we still see a lot of opportunity to expand our highly profitable stores right now, but we're also looking possibly to opening a few larger stores.

The Movie Gallery locations, are they kind of a cookie cutter box, or do they vary all over the place in terms of size?

Unfortunately, they vary all over the place. Some of them are a little bit smaller than we would like but we do really like their locations. They're very -- they're free-standing, the right -- Main and Main, in a small town. So far the results in the seven that we have opened have been very positive.

Okay. Thanks again.

Thank you.

Thank you. At this time, I'll turn the conference back to Mr. Newsome. Please continue with your presentation or closing remarks.

Thank you. In summary, we are proud and excited about the results we have produced the last four quarters at Hibbett Sporting Goods. Three consecutive quarters of double digit comp store sales increases. Year-to-date comps 13%. Year-to-date earnings per share, plus 62.4% over the previous year.

We ended the quarter with 789 stores, and should end the year with 798 new stores. We're pleased that we will open more net new stores than we thought three months ago. We have specifically identified 400 additional stores that we could -- markets that we could put stores in, in a 26-state area, for future growth.

We have increased our earnings per share guidance for the fifth straight quarter. We have got a strong start in the fourth quarter of this year. We are a greatly improved Company year-over-year.

Thanks for being on the call today. We look forward to speaking with you on March 11, next year, at 9 o'clock Central Standard Time with our fourth quarter results. Thank you for being on the call.

Ladies and gentlemen, that does conclude the conference call for today. We thank you very much for your participation, and ask that you please disconnect your lines.