Dick's Sporting Goods Inc

Hello everyone and welcome to the Dick's Sporting Goods Q4 2022 earnings conference call. My name is Emily and I'll be coordinating your call today. After the presentation you will have the opportunity to ask any questions by pressing start followed by one on your telephone keypad and we ask that you please limit yourself to one question and one follow-up question only. I'll now turn the call over to our host Nate Gilch, Senior Director of Investor Relations. Please go ahead.

Good morning everyone. And thank you for joining us to discuss our fourth quarter and full year 2022 results. On today's call will be Lauren Hobart, our President and Chief Executive Officer, and Navdeep Gupta, our Chief Financial Officer. The playback of today's call will be archived in our Investor Relations website, located at investors.dix.com, for approximately 12 months. As a reminder, we will be making forward-looking statements which are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements. Any such statements should be considered in conjunction with cautionary statements in our earnings release and risk factor discussions in our filings with the SEC, including our last annual report on Form 10-K and cautionary statements made during this call. We assume no obligation to update any of these forward-looking statements or information. Please refer to our investor relations website to find the reconciliation of our non-GAAP financial measures referenced in today's call. And finally, for your future scheduling purposes, we are tentatively planning to publish our first quarter 2023 earnings results on May 23rd, 2023. With that, I will now turn the call over to Lauren.

Thank you, Nate, and good morning, everyone. We are very pleased with our 2022 results, which demonstrate the continued success and strength of our business as we realize the benefits of our long-term transformation through focused strategies and strong execution. Our athletes are passionate, about healthy, active lifestyles, and they've continued to prioritize sport and rely on Dick's Sporting Goods to meet their needs. Importantly, we continued to gain market share at an accelerating pace with considerable growth in our largest and most important categories. Our fourth quarter was a strong ending to another strong year. This Q4, we achieved record quarterly sales of $3.6 billion, and our comps increased 5.3%. This strong comp was on top of a 6.6% comp last year, a 19.3% comp in 2020, and a 5.3% comp in 2019. And for this fourth quarter, we delivered non-GAAP EPS of $2.93, significantly ahead of any pre-COVID Q4 in our history. For the full year, we achieved sales of $12.4 billion. Our non-GAAP EBT margin was 11.4%, and we delivered non-GAAP EPS of $12.04. To put this in context, when you look at our 2022 performance versus 2019, our sales increased 41%, or $3.6 billion. Our merchandise margin increased more than 300 basis points. Our non-GAAP EBT margin more than doubled. and our non-GAAP EPS is more than three times higher than 2019. Our strong performance and financial strength position us to increase the rate of investment in our business to fuel long-term growth opportunities and also return significant capital to shareholders. The step-change increase in our dividend that we announced today, more than doubling our annualized payout to $4 per share or $1 on a quarterly basis, clearly reflects our strong conviction in the structurally higher sales and earnings profile of our business and our ongoing focus on delivering shareholder value. With 2023 marking our company's 75th anniversary, this is an incredibly exciting time for Dick's Sporting Goods. Our company was founded in 1948 by Dick Stack with a dream and $300 from his grandmother's cookie jar. Under Ed's leadership, it's grown from a small bait and tackle shop to become the preeminent sporting goods retailer in the country. I've had the honor of working alongside Ed for over a decade, and we will continue partnering to drive the business forward. While we will take the time to celebrate our heritage, we believe it's just as important to use this milestone as an opportunity to look forward. Our future is extremely bright. and we have great momentum as we write the next chapter in our growth story. Our 2022 results provide a strong foundation upon which we will build in 2023 and in the years ahead. In 2023, we will grow both our sales and earnings through positive comps, a return to square footage growth, and higher merchandise margins. We expect our comparable store sales to be in the range of flat to positive 2%. We expect our earnings per diluted share to be in the range of $12.90 to $13.80, which at the midpoint is up 11% versus 2022. We will continue to create and define our future. And as the largest U.S. sporting goods retailer, we are well positioned to extend our lead and continue gaining share in a fragmented $140 billion industry. I'd like to thank all of our teammates for delivering another strong year and for their passion, hard work, and dedication to our business. At Dix, it is our people who make us great, and none of what we would have accomplished, none of what we have accomplished, excuse me, would have been possible without our exceptional team. I'll now turn the call over to Navdeep to review our financial results, outlook, and capital allocation in more detail.