* Q2 adjusted EPS $0.24 vs Wall Street $0.06
* Revenue rises 4.4 pct, same-store sales up 6.1 pct
* Says full-year EPS could top 2008
* Shares surge 13 percent, hit 20-month high
(Adds CEO quote, detail on charge-offs, adjusts shares, adds
By Ben Klayman
CHICAGO, July 30 Outdoor gear retailer Cabela's
Inc (CAB.N) posted a bigger-than-expected 25 percent increase
in quarterly profit, helped by cost-cuts and demand for hunting
equipment, sending its shares to their highest in almost two
The company also raised its 2009 revenue outlook and said
earnings for the year could top last year's earnings.
"These guys had what appears to be a fantastic quarter,"
Feltl and Co analyst Mark Smith said, citing strength across
all segments, especially the hunting equipment category, and
better-than-expected results within the credit card business.
"The fact that they're talking about 'if this momentum
continues we'll see earnings growth' is very good news for
investors," added Smith, who has a "buy" rating on the stock.
Cabela's sells gear and apparel for fishing, hunting and
other outdoor activities in stores, through its catalog and on
the Web. In recent quarters, sales of firearms and ammunition
have given results a boost, but charge-offs at its financial
services arm have cut into profit.
Net income rose to $9.12 million, or 14 cents a share, in
the second quarter, from $7.28 million, or 11 cents a share, a
Excluding one-time items, the company earned 24 cents a
share, far above the 6 cents analysts, on average, had
expected, according to Reuters Estimates.
"We continue to gain momentum in the hunting equipment
category, as we take market share from our competitors," Chief
Executive Tommy Millner said in a statement.
During a call with analysts, Millner cited lower costs and
reduced markdowns due to leaner inventory levels.
"We're running the company on less inventory," he said.
"Having less inventory and having more inventory of the right
stuff just leads you to make a lot less dumb decisions, quite
Revenue rose 4.4 percent to $549.2 million, above the
$531.3 million analysts had expected. Retail store revenue rose
10.2 percent, led by a 6.1 increase in same-store sales.
The company said delinquencies at its financial services
arm were stabilizing while charge-offs in June were at the
lowest level since February. Cabela's said it still expects net
charge-offs to increase, ranging between 5.1 percent and 5.5
percent for 2009.
For the full year, the company expects revenue and
same-store sales to increase at low-single-digit percentage
rates, up from its previous forecast for flat performance.
Cabela's, based in Sidney, Nebraska, still expects
full-year earnings per share to roughly equal 2008 results --
or about $1.14 -- but said profit could rise if the first-half
Analysts had been expecting 2009 earnings of $1.05 per
The company's shares, which were already up 152 percent
from January, surged as much as 21 percent, hitting $17.73 --
their highest since November 2007 -- in morning trading on the
New York Stock Exchange.
By early afternoon they were up 10.8 percent to $16.26.
(Additional reporting by Alexandria Sage; editing by Ted Kerr,
Derek Caney and Steve Orlofsky)