Demand for guns remains high at Cabela’s, the company said Wednesday, despite slumping third quarter sales.
Compared to third quarter 2015, Cabela’s store sales dipped 2.3 percent and strengths in “firearms and shooting related categories…was more than offset by continued softness in our apparel categories.”
“Shooting related categories” did help drive a 3.6 percent increase in internet and catalog sales, the company reported.
Overall, 2016 revenue nears $2.8 billion as of Oct. 1, a 7.8 percent increase over last year. Similarly, third quarter’s $996.5 million in revenues remain 7.5 percent higher compared to third quarter 2015.
“During the third quarter, we successfully drove sales growth in several of our key merchandise categories through an aggressive promotional and markdown cadence; however, these promotional activities also resulted in a decrease in merchandise gross margins and were the primary contributor to the profitability shortfall,” said Tommy Millner, Cabela’s Chief Executive Officer. “Importantly, we saw the success of a variety of expense leverage efforts, and we continue to be excited about the Company’s announcement of our combination with Bass Pro Shops, which is expected to be completed in the first half of 2017.”
Bass Pro Shops announced the $5.5 billion acquisition of Cabela’s on Oct.3, Guns.com previously reported.
The competitor companies said “complementary business philosophies, product offerings, expertise and geographic footprints of the two businesses” drove the decision to merge.
Bass Pro will maintain Cabela’s management and facilities in Sidney, Nebraska, where it was founded in 1961. Also, it will continue to honor customer rewards programs such as the Cabela’s Club Loyalty program.