By Ben Glickman
Shares of Big 5 Sporting Goods took a hit on Tuesday as the company decided to reduce its dividend by 50%. This move caused the stock to drop by 13% in after-hours trading, following a slight decline of 0.1% at Tuesday's close. It has been a challenging year for the company, with shares down 20% overall.
Based in El Segundo, California, this sporting goods retailer cited softer consumer discretionary spending as the main reason behind their decision. Furthermore, they anticipate that this trend of weaker sales will continue into the fourth quarter.
In light of these circumstances, Big 5 announced a new quarterly dividend of 12.5 cents per share, a significant decrease from their previous payout of 25 cents per share.
The company's financials for the current year reflect the difficult market conditions. Big 5 reported a profit of $1.86 million, or 8 cents per share, in comparison to $6.37 million, or 29 cents per share, from the previous year. This stands in contrast to their initial earnings forecast of 10-20 cents per share.
Another notable figure is the year-on-year decline in same-store sales, which dropped by 8.2%.
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