‘Next generation’ stores help Cabela’s stock soar

RETAIL: Outdoor outfitter with giant Lacey presence shows strong third quarter

rboone@theolympian.comNovember 6, 2012 

Outdoor gear retailer Cabela’s profit shot higher in its fiscal third quarter, helped by a strong performance from its eight “next-generation” stores.

The 100,000-square-foot Tulalip location in Snohomish County is a next-generation store – smaller than a Cabela’s legacy store, such as the 195,000-square-foot store in Lacey.

Sidney, Neb.-based Cabela’s net income rose to $42.8 million, or 60 cents a share, compared with $33.3 million, or 47 cents a share, in the year-ago period, according to its third-quarter earnings, which were released last month.

Revenue rose across all of its business divisions except for direct revenue – Internet and telephone orders – which fell 6.7 percent to $196.8 million.

Chief Executive Tommy Millner told analysts during a conference call that the direct-revenue category fell because demand was weaker for clothing and footwear, which he attributed to warm weather and to more people shopping at Cabelas’ new and established stores.

Once colder weather arrived, the direct revenue category showed improvement, he said.

Total revenue in the quarter rose 9.2 percent to $741.2 million.

One analyst asked what effect the election would have on gun and ammunition sales.

Millner said that if President Barack Obama wins, sales should rise “beyond current levels, which are already really good.”

“I still expect gun growth, but not at the same pace,” he said about a former Gov. Mitt Romney victory.

Millner also added that sales of guns and ammunition remain strong because interest in shooting sports continues to grow.

The company also opened its first 40,000-square-foot outpost store, in Union Gap, near Yakima. All future store openings will either be next-generation or outpost stores, Millner said.

Cabela’s stock, which trades under the ticker symbol CAB, closed up 40 cents at $44.35 a share Monday. In the past 52 weeks, the stock has traded between $21.51 and $56.78 a share.

Rolf Boone: 360-754-5403 rboone@theolympian.com theolympian.com/bizblog @rolf_boone

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