UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended April 30, 2005

Commission File No. 001-31463

DICK’S SPORTING GOODS, INC.

(724) 273-3400
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).

The number of shares of common stock and Class B common stock outstanding at May 11, 2005 was 35,409,394 and 13,920,845, respectively.

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INDEX TO FORM 10-Q

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

DICK’S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED
(Dollars in thousands, except per share data)

See accompanying notes to unaudited consolidated financial statements.

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DICK’S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - UNAUDITED
(Dollars in thousands)

See accompanying notes to unaudited consolidated financial statements.

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DICK’S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - UNAUDITED
(Dollars in thousands)

See accompanying notes to unaudited consolidated financial statements.

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DICK’S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY - UNAUDITED
(Dollars in thousands)

See accompanying notes to unaudited consolidated financial statements.

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DICK’S SPORTING GOODS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED
(Dollars in thousands)

See accompanying notes to unaudited consolidated financial statements.

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DICK’S SPORTING GOODS, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1. Company

     On July 29, 2004, a wholly owned subsidiary of Dick’s Sporting Goods, Inc. completed the acquisition of Galyan’s Trading Company, Inc. (“Galyan’s”). The Consolidated Statements of Operations for the 13 weeks ended April 30, 2005 reflect the results of the combined company for the entire 13 weeks. Prior year results include Dick’s Sporting Goods, Inc. on a stand-alone basis. Unless otherwise specified, any reference to year is to our fiscal year and when used in this Form 10-Q and unless the context otherwise requires, the terms “Dick’s,” “we,” “us,” “the Company” and “our” refer to Dick’s Sporting Goods, Inc. and its wholly owned subsidiaries.

2. Basis of Presentation

     The accompanying unaudited condensed consolidated financial statements have been prepared by us, in accordance with the requirements for Form 10-Q and do not include all the disclosures normally required in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America. The interim financial information as of April 30, 2005 and for the 13 weeks ended April 30, 2005 and May 1, 2004 is unaudited and has been prepared on the same basis as the audited financial statements. In the opinion of management, such unaudited information includes all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the interim financial information. This financial information should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended January 29, 2005 dated March 31, 2005 as filed with the Securities and Exchange Commission. Operating results for the 13 weeks ended April 30, 2005 are not necessarily indicative of the results that may be expected for the year ending January 28, 2006 or any other period.

3. Business Combination

     On July 29, 2004, Dick’s Sporting Goods, Inc. acquired all of the common stock of Galyan’s for $16.75 per share in cash, and Galyan’s became a wholly owned subsidiary of Dick’s. As of April 30, 2005, $157.2 million of goodwill was recorded as the excess of the purchase price of $369.6 million over the fair value of the net amounts assigned to assets acquired and liabilities assumed. The Company has received an independent appraisal for certain assets and is in the process of refining its internal fair value estimates for certain assets and liabilities; therefore, the allocation of the purchase price is preliminary and the final allocation may differ. Based on the preliminary purchase price allocation, the following table summarizes estimated fair values of the assets acquired and liabilities assumed (in thousands):

     As of April 30, 2005, the Company had accrued expenses of $1.5 million related to Galyan’s associate severance, retention bonuses and relocation and $1.5 million related to the four closed Galyan’s stores, which consists primarily of rent, common area maintenance and real estate taxes. These costs were accounted for under Emerging Issues Task Force No. 95-3 (“Issue 95-3”), “Recognition of Liabilities in Connection with a Purchase Business Combination” and were recognized as a liability assumed in the acquisition. The Company is continuing to assess and complete the integration plans, which may result in changes to those accruals and reserves recorded.

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     The following table summarizes the activity in 2005 (in thousands):

     The $5.2 million of inventory reserve utilized for the clearance of discontinued Galyan’s merchandise was recorded as a reduction of cost of sales for the 13 weeks ended April 30, 2005. The Company believes that the remaining reserves are adequate to complete its integration plan and expects payments to be substantially completed by the end of fiscal 2005 with the balance in fiscal 2006 and beyond which relates primarily to future lease payments on closed stores.

     The following unaudited pro-forma summary presents information as if Galyan’s had been acquired at the beginning of each period presented. The pro-forma amounts include certain reclassifications to Galyan’s amounts to conform them to the Company’s presentation, and an increase in interest expense of $1.9 million for the 13 weeks ended May 1, 2004 to reflect the increase in borrowings under the amended credit facility to finance the acquisition as if it had occurred at the beginning of the period. The pro-forma amounts do not reflect any benefits from economies, which may be achieved from combining the operations.

     The pro-forma information does not necessarily reflect the actual results that would have occurred had the companies been combined during the periods presented, nor is it necessarily indicative of the future results of operations of the combined companies.

4. Goodwill and Other Intangible Assets

     In connection with the acquisition of Galyan’s on July 29, 2004, the Company recorded goodwill and other intangible assets in accordance with SFAS No. 141, “Business Combinations”. As of April 30, 2005, the $157.2 million of goodwill was recorded as the excess of the purchase price of $369.6 million over the fair value of the net amounts assigned to assets acquired and liabilities assumed. In accordance with SFAS No. 142, “Accounting for Goodwill and Other Intangible Assets”, the Company will continue to assess on an annual basis whether goodwill and other intangible assets acquired in the acquisition of Galyan’s are impaired. Additional impairment assessments may be performed on an interim basis if the Company deems it necessary. Finite-lived intangible assets will be amortized over their estimated useful economic lives and periodically reviewed for impairment. No amounts assigned to any intangible assets are deductible for tax purposes.

     Acquired intangible assets subject to amortization at April 30, 2005 were as follows (in thousands):

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     Amortization expense for intangible assets subject to amortization was $0.1 million for the 13 weeks ended April 30, 2005. The estimated economic useful life is 11 years. The annual amortization expense of the favorable leases recorded as of April 30, 2005 is expected to be as follows (in thousands):

5. Store and Corporate Office Closings

     As a result of the Galyan’s acquisition, the Company decided to close six Dick’s Sporting Goods stores and four Galyan’s stores, the Galyan’s clearance center and the Galyan’s corporate headquarters. As of April 30, 2005, the Company had recorded $1.5 million of reserves and write-offs, net of cash payments for leases and other exit costs, related to the closings of the Galyan’s locations. See Note 3 for a summary of the activity of the Galyan’s store closing reserves during the quarter.

     In the first quarter of fiscal 2005, the Company closed four Dick’s stores due to the acquisition. The following table summarizes the activity of the Dick’s store closing reserves and write-offs established due to store closings as a result of the Galyan’s acquisition:

     The expense charged to earnings of $17.2 million was recorded in merger integration and store closing costs in the Consolidated Statements of Operations. The amounts above relate to store rent, common area maintenance and real estate taxes, and other contractual obligations.

6. Stock-Based Compensation

     The Company accounts for stock-based compensation using the intrinsic value method prescribed in Accounting Principles Board Opinion (“APB”) No. 25, “Accounting for Stock Issued to Employees” and related Interpretations. Accordingly, no compensation expense has been recognized where the exercise price of the option was equal to or greater than the market value of the underlying common stock on the date of grant. The pro-forma net income and earnings per share

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in the following table illustrates the effect on net (loss) income and earnings per share as if the Company had applied the fair value recognition provisions of SFAS No. 123, “Accounting for Stock-Based Compensation,” to stock-based employee compensation.

7. Earnings Per Share

     Basic earnings per share are based upon the weighted average number of shares outstanding. Diluted earnings per share are based upon the weighted average number of shares outstanding plus the incremental shares that would be outstanding assuming exercise of dilutive stock options. The number of incremental shares from the assumed exercise of stock options is calculated by applying the treasury stock method. The aggregate number of shares, totaling 4,388,024, that the Company could be obligated to issue upon conversion of our $172.5 million issue price of senior convertible notes was excluded from the 13 weeks ended April 30, 2005 calculation as they were anti-dilutive. In addition, since we had a loss from operations for the 13 weeks ended April 30, 2005, 4,604,415 shares were excluded from the calculation of diluted loss per common share, as these stock options were anti-dilutive.

     The computations for basic and diluted earnings per share are as follows:

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

     We caution that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this Quarterly Report on Form 10-Q or made by our management involve risks and uncertainties and are subject to change based on various important factors, many of which may be beyond our control. Accordingly, our future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements. Accordingly, investors should not place undue reliance on forward-looking statements as a prediction of actual results. You can identify these statements as those that may predict, forecast, indicate or imply future results, performance or advancements and by forward-looking words such as “believe,” “anticipate,” “expect,” “estimate,” “predict,” “intend,” “plan,” “project,” “will,” “will be,” “will continue,” “will result,” “could,” “may,” “might” or any variations of such words or other words with similar meanings. Forward-looking statements address, among other things, our expectations, our growth strategies, including our plans to open new stores, our efforts to increase profit margins and return on invested capital, plans to grow our private label business, projections of our future profitability, results of operations, capital expenditures or our financial condition or other “forward-looking” information and includes statements about revenues, earnings, spending, margins, liquidity, store openings and operations, inventory, private label products, our actions, plans or strategies.

     The following factors, among others, in some cases have affected and in the future could affect our financial performance and actual results and could cause actual results for 2005 and beyond to differ materially from those expressed or implied in any forward-looking statements included in this report or otherwise made by our management: the intense competition in the sporting goods industry and actions by our competitors; our inability to manage our growth, open new stores on a timely basis and expand successfully in new and existing markets; the availability of retail store sites on terms acceptable to us; the cost of real estate and other items related to our stores; our ability to access adequate capital; changes in consumer demand; risks relating to product liability claims and the availability of sufficient insurance coverage relating to those claims; our relationships with our suppliers, distributors or manufacturers and their ability to provide us with sufficient quantities of products; any serious disruption at our distribution or return facilities; the seasonality of our business; the potential impact of natural disasters or national and international security concerns on us or the retail environment; risks related to the economic impact or the effect on the U.S. retail environment relating to instability and conflict in the Middle East or elsewhere; risks relating to the regulation of the products we sell, such as hunting rifles; risks associated with relying on foreign sources of production; risks relating to implementation of new management information systems; risks relating to operational and financial restrictions imposed by our Credit Agreement; factors associated with our pursuit of strategic acquisitions; risks and uncertainties associated with assimilating acquired companies; the loss of our key executives, especially Edward W. Stack, our Chairman and Chief Executive Officer; our ability to meet our labor needs; changes in general economic and business conditions and in the specialty retail or sporting goods industry in particular; our ability to repay or make the cash payments under our senior convertible notes; changes in our business strategies and other factors discussed in other reports or filings filed by us with the Securities and Exchange Commission.

     In addition, we operate in a highly competitive and rapidly changing environment; therefore, new risk factors can arise, and it is not possible for management to predict all such risk factors, nor to assess the impact of all such risk factors on our business or the extent to which any individual risk factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. We do not assume any obligation and do not intend to update any forward-looking statements.

     On July 29, 2004, Dick’s Sporting Goods, Inc. acquired all of the common stock of Galyan’s which became a wholly owned subsidiary of Dick’s. Due to this acquisition, additional risks and uncertainties arise that could affect our financial performance and actual results and could cause actual results for 2005 and beyond to differ materially from those expressed or implied in any forward-looking statements included in this report or otherwise made by our management: risks associated with combining businesses and achieving expected savings and synergies (including annualized cost savings and merchandise buying improvements) and/or with assimilating acquired companies and the fact that merger integration and store closing costs related to the Galyan’s acquisition are difficult to predict with a level of certainty and may be greater than expected.

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OVERVIEW

     Dick’s is an authentic full-line sporting goods retailer offering a broad assortment of brand-name sporting goods equipment, apparel and footwear in a specialty store environment. On July 29, 2004, a wholly owned subsidiary of Dick’s Sporting Goods, Inc. completed the acquisition of Galyan’s Trading Company, Inc. The Consolidated Statements of Operations for the 13 weeks ended April 30, 2005 reflect the results of the combined company for the entire 13 weeks. Prior year results include Dick’s Sporting Goods, Inc. on a stand-alone basis. Unless otherwise specified, any reference to year is to our fiscal year and when used in this Form 10-Q and unless the context otherwise requires, the terms “Dick’s,” “we,” “us,” “the Company” and “our” refer to Dick’s Sporting Goods, Inc. and its wholly owned subsidiaries. As of April 30, 2005, the Company operated 236 stores in 34 states primarily throughout the Eastern half of the United States.

     Due to the seasonal nature of our business, interim results are not necessarily indicative of results for the entire fiscal year. Our revenue and earnings are typically greater during our fiscal fourth quarter, which includes the majority of the holiday selling season.

     Executive Summary

     The Company reported a net loss for the 13 weeks ended April 30, 2005 of $7.3 million or $(0.15) per share as compared to net income of $10.6 million, or $0.20 per share for the 13 weeks ended May 1, 2004. The decrease was primarily due to merger integration and store closing costs of $19.5 million, after tax, and higher occupancy costs as a percentage of sales, partially offset by an increase in the merchandise margin percentage and lower selling, general and administrative expenses as a percentage of sales.

     Net sales increased 57%, or $206.6 million to $570.8 million for the 13 weeks ended April 30, 2005 from $364.2 million for the 13 weeks ended May 1, 2004. This increase resulted primarily from a comparable store sales increase of 3.2%, or $10.5 million, and $196.1 million from the net addition of new Dick’s stores in the last five quarters which are not included in the comparable store base, and the acquired Galyan’s stores which we are planning to include in the comparable store base beginning in the second quarter of fiscal 2006, as the re-branding and re-merchandising effort of all converted Galyan’s stores has been substantially completed as of the end of the first quarter of 2005.

     The Company recorded an operating loss for the 13 weeks ended April 30, 2005 of $9.4 million compared with operating income for the 13 weeks ended May 1, 2004 of $17.3 million. The decrease was primarily due to $32.5 million of merger integration and store closing costs and higher occupancy costs as a percentage of sales, partially offset by an increase in the merchandise margin percentage and lower selling, general and administrative expenses as a percentage of sales.

     As a percentage of net sales, gross profit decreased to 26.6% for the 13 weeks ended April 30, 2005, from 28.2% for the 13 weeks ended May 1, 2004. The decrease in gross profit percentage was primarily due to higher occupancy costs and freight as a percentage of sales partially offset by an increase in the merchandise margin percentage.

     During the first quarter we leveraged selling, general and administrative expenses by 44 basis points. The decrease as a percentage of sales was due primarily to a decrease in advertising expense and administrative expenses, partially offset by higher store payroll expense.

     The operations of Galyan’s are included in the entire 13 week period ended April 30, 2005. Prior year results include Dick’s Sporting Goods, Inc. on a stand-alone basis. As of April 30, 2005, we have substantially completed the modification of the interior of the stores and have effected changes to the merchandise assortment. See “Outlook” below.

     We ended the first quarter with $122.5 million of outstanding borrowings on our line of credit as compared to $76.1 at January 29, 2005. The increase was primarily due to using the line to fund our seasonal borrowing requirements, merger integration expenses, and capital expenditures. Excess borrowing availability totaled $185.8 million at April 30, 2005.

RESULTS OF OPERATIONS AND OTHER SELECTED DATA

     The following table presents for the periods indicated selected items in the Consolidated Statements of Operations as a percentage of the Company’s net sales, as well as other selected data which provides a further understanding of our business:

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     (2) Revenue from retail sales is recognized at the point of sale. Revenue from cash received for gift cards is deferred, and the revenue is recognized upon the redemption of the gift card. Sales are recorded net of estimated returns. Revenue from layaway sales is recognized upon receipt of final payment from the customer.

     (3) Cost of goods sold includes the cost of merchandise, inventory shrinkage, freight, distribution and store occupancy costs. Store occupancy costs include rent, common area maintenance charges, real estate and other asset based taxes, store maintenance, utilities, depreciation, fixture lease expenses and certain insurance expenses.

     (4) Selling, general and administrative expenses include store and field support payroll and fringe benefits, advertising, bank card charges, information systems, marketing, legal, accounting, other store expenses and all expenses associated with operating the Company’s corporate headquarters.

     (5) Pre-opening expenses consist primarily of rent, marketing, payroll and recruiting costs incurred prior to a new store opening.

     (6) Merger integration and store closing costs include the expense of closing Dick’s stores in connection with the Galyan’s acquisition, advertising the rebranding of former Galyan’s stores as Dick’s stores, duplicative administrative costs, recruiting and system conversion costs.

     (7) Interest expense, net, results primarily from interest on our senior convertible notes and Credit Agreement.

     (8) Comparable store sales begin in a store’s 14^th full month of operations after its grand opening. Comparable store sales are for stores that opened at least 13 months prior to the beginning of the period noted. Stores that were relocated during the applicable period have been excluded from comparable store sales. Each relocated store is returned to the comparable store base after its 14^th full month of operations at that new location. The conversion, re-merchandising and grand re-opening of the former Galyan’s stores to Dick’s stores is essentially complete. Since the conversion is completed, the former Galyan’s stores will be included in the comparable store sales base beginning in the second quarter of fiscal 2006.

     (9) Number of stores at end of period and total square feet at end of period represents the combined companies as of April 30, 2005 and Dick’s Sporting Goods, Inc. stand-alone as of May 1, 2004.

CRITICAL ACCOUNTING POLICIES

     Critical accounting policies are those that the Company believes are both most important to the portrayal of the Company’s financial condition and results of operations, and require the Company’s most difficult, subjective or complex

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judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. Judgments and uncertainties affecting the application of those policies may result in materially different amounts being reported under different conditions or using different assumptions.

     The Company considers the following policies to be the most critical in understanding the judgments that are involved in preparing its consolidated financial statements.

Inventory Valuation

     The Company values inventory using the lower of weighted average cost or market method. Market value is generally based on the current selling price of the merchandise. The Company regularly reviews inventories to determine if the carrying value of the inventory exceeds market value and the Company records a reserve to reduce the carrying value to its market price, as necessary. Historically, the Company has rarely experienced significant occurrences of obsolescence or slow moving inventory. However, future changes such as customer merchandise preference, unseasonable weather patterns, or business trends could cause the Company’s inventory to be exposed to obsolescence or slow moving merchandise.

     Shrink expense is accrued as a percentage of merchandise sales based on historical shrink trends. The Company performs physical inventories at the stores and distribution center throughout the year. The reserve for shrink represents an estimate for shrink for each of the Company’s locations since the last physical inventory date through the reporting date. Estimates by location and in the aggregate are impacted by internal and external factors and may vary significantly from actual results.

Vendor Allowances

     Vendor allowances include allowances, rebates and cooperative advertising funds received from vendors. These funds are determined for each fiscal year and the majority are based on various quantitative contract terms. Amounts expected to be received from vendors relating to the purchase of merchandise inventories are recognized as a reduction of cost of goods sold as the merchandise is sold. Amounts that represent a reimbursement of costs incurred, such as advertising, are recorded as a reduction to the related expense in the period that the related expense is incurred. The Company records an estimate of earned allowances based on the latest projected purchase volumes and advertising forecasts. On an annual basis, the Company confirms earned allowances with vendors to ensure the amounts are recorded in accordance with the terms of the contract.

Goodwill, Intangible Assets and Impairment of Assets

     Goodwill and other intangible assets must be tested for impairment on an annual basis. Our evaluation of goodwill and intangible assets with indefinite useful lives for impairment requires accounting judgments and financial estimates in determining the fair value of such assets. If these judgments or estimates change in the future, we may be required to record impairment charges for these assets.

     The Company reviews long-lived assets for impairment whenever events and circumstances indicate that the carrying value of these assets may not be recoverable based on estimated undiscounted future cash flows. Assets are reviewed at the lowest level for which cash flows can be identified, which is the store level. In estimating future cash flows, significant estimates are made by the Company with respect to future operating results of each store over its remaining lease term. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.

Business Combinations

     Our acquisition of Galyan’s is accounted for under the purchase method of accounting. The assets and liabilities of Galyan’s are adjusted to their fair values and the excess of the purchase price over the net assets acquired is recorded as goodwill. The purchase price allocation as of April 30, 2005 is preliminary. The determination of fair values involves the use of estimates and assumptions, which will require adjustments in the future. While we believe the factors considered and the independent appraisal performed will provide a reasonable basis for determining fair value, we cannot guarantee that the estimates and assumptions used will prevent adjustments to those estimates in future periods.

Self-Insurance

     The Company is self-insured for certain losses related to health, workers’ compensation and general liability insurance, although we maintain stop-loss coverage with third-party insurers to limit our liability exposure. Liabilities associated with these losses are estimated in part by considering historical claims experience, industry factors, severity factors and other actuarial assumptions.

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13 Weeks Ended April 30, 2005 Compared to the 13 Weeks Ended May 1, 2004

Net Loss

     The Company reported a net loss for the 13 weeks ended April 30, 2005 of $7.3 million or $(0.15) per share as compared to net income of $10.6 million, or $0.20 per share for the 13 weeks ended May 1, 2004. The decrease was primarily due to merger integration and store closing costs of $19.5 million, after tax, and higher occupancy costs as a percentage of sales, partially offset by an increase in the merchandise margin percentage and lower selling, general and administrative expenses as a percentage of sales.

Net Sales

     Net sales increased by $206.6 million, or 57%, to $570.8 million for the 13 weeks ended April 30, 2005, from $364.2 million for the 13 weeks ended May 1, 2004. This increase resulted primarily from a comparable store sales increase of 3.2%, or $10.5 million and $196.1 million from the net addition of new Dick’s stores in the last five quarters which are not included in the comparable store base, and the acquired Galyan’s stores which we are planning to include in the comparable store base beginning in the second quarter of fiscal 2006, as the re-branding and re-merchandising effort of all converted Galyan’s stores has essentially been completed as of the end of the first quarter of 2005.

     The increase in comparable store sales is mostly attributable to sales increases throughout much of our business, including athletic footwear and apparel, exercise, cleats, women’s rugged/outdoor apparel, and sports games and accessories. Those favorable results were partially offset by sales declines in bikes, paintball, inline skates, fishing tackle and hockey.

     Private Label Sales

     For the 13 weeks ended April 30, 2005, private label product sales in total for all stores represented 10.1% of sales, an increase from last year’s 7.7% on a proforma Dick’s and Galyan’s combined basis. These private label sales are for the merchandise developed by Dick’s, and do not include any remaining private label products developed by Galyan’s.

     Store Count

     During the quarter we opened seven stores compared to the opening of six new stores for the 13 weeks ended May 1, 2004. We closed four Dick’s stores and one Galyan’s store during the quarter, all of which were stores in overlapping trade areas due to the Galyan’s acquisition.

     Loss from Operations

     The Company recorded an operating loss for the 13 weeks ended April 30, 2005 of $9.4 million compared with operating income for the 13 weeks ended May 1, 2004 of $17.3 million. The decrease was primarily due to $32.5 million of merger integration and store closing costs and higher occupancy costs as a percentage of sales, partially offset by an increase in the merchandise margin percentage and lower selling, general and administrative expenses as a percentage of sales.

     Gross profit increased by $49.2 million, or 48%, to $152.0 million for the 13 weeks ended April 30, 2005, from $102.8 million for the 13 weeks ended May 1, 2004. As a percentage of net sales, gross profit decreased to 26.6% for the 13 weeks ended April 30, 2005, from 28.2% for the 13 weeks ended May 1, 2004. The decrease in gross profit percentage was primarily due to higher occupancy costs and freight as a percentage of sales partially offset by an increase in the merchandise margin percentage.

     Selling, general and administrative expenses increased by $44.1 million to $126.3 million for the 13 weeks ended April 30, 2005, from $82.2 million for the 13 weeks ended May 1, 2004 due primarily to an increase in store count and continued investment in corporate and store infrastructure. As a percentage of net sales, selling, general and administrative expenses decreased from 22.6% for the 13 weeks ended May 1, 2004 to 22.1% for the 13 weeks ended April 30, 2005. The percentage decrease was a result of lower advertising expense (81 basis points), a decreases in corporate administrative expenses (61 basis points) as a result of synergies gained due to the acquisition, partially offset by higher store payroll and related fringe benefit expense (106 basis points).

     Merger integration and store closing costs associated with the purchase of Galyan’s were $32.5 million, or 5.7% of sales for the 13 weeks ended April 30, 2005. These costs consisted primarily of $18.2 million of store closing costs associated with the closed Dick’s stores, $12.2 million of advertising expense related to the conversion of Galyan’s stores to

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Dick’s stores, and $2.1 million of other costs.

     Pre-opening expenses decreased by $0.7 million to $2.6 million for the 13 weeks ended April 30, 2005, from $3.3 million for the 13 weeks ended May 1, 2004. Pre-opening expenses decreased primarily due to the opening of the seven new stores earlier in the quarter during the 13 weeks ended April 30, 2005 when compared to the opening of six new stores for the 13 weeks ended May 1, 2004.

Other Income

     Other income for the 13 weeks ended May 1, 2004 included a $1.0 million award arising out of a court order related to our unsuccessful effort to acquire the assets of Bob’s Store, Inc.

Interest Expense, Net

     Interest expense, net, increased by $2.2 million to $2.8 million for the 13 weeks ended April 30, 2005, from $0.6 million for the 13 weeks ended May 1, 2004 due primarily to interest expense on our revolving credit borrowings that were used to acquire Galyan’s and reduced interest income.

LIQUIDITY AND CAPITAL RESOURCES

     Our primary capital requirements are for inventory, capital improvements, and pre-opening expenses to support expansion plans, as well as for various investments in store remodeling, store fixtures and ongoing infrastructure improvements. The Company’s main sources of liquidity for the 13 weeks ended April 30, 2005 have been our borrowings pursuant to the Credit Agreement and proceeds from sale-leaseback transactions.

     The change in cash and cash equivalents is as follows (in thousands):

Operating Activities

     Cash used in operating activities for the 13 weeks ended April 30, 2005 increased by $10.4 million to $32.9 million reflecting lower net income of $17.9 million and an increase in the change in assets and liabilities of $2.9 million, partially offset by an increase in adjustments to net income of $10.4 million.

     Adjustments to Net Income

     Depreciation expense increased $8.5 million due primarily to including Galyan’s operations for the 13 weeks ended April 30, 2005.

     Tax benefit from the exercise of stock options increased by $2.7 million. As options granted under the Company’s stock plans are exercised, the Company will continue to receive a tax deduction; however, the amounts and the timing cannot be predicted.

     Changes in Assets and Liabilities

     The primary factors contributing to the increase in the change in assets and liabilities were the change in inventory and accounts receivable partially offset by the change in accounts payable and accrued expenses.

     The increase in the change in inventory and the increase in the change in accounts payable were primarily due to the increase in in-transit inventory and an increase in spring and summer receipts in fiscal 2005 compared to fiscal 2004. The

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increase in the change in accounts receivable is primarily related to an increase in the number of stores that have landlord contributions and an increase in the income tax receivable. The increase in the change in accounts payable is primarily related to the increase in in-transit inventory compared to the prior year first quarter. The increase in accrued expenses is primarily related to an increase in accrued property and equipment and an increase in reserves for store closings due to the Galyan’s acquisition.

     The cash flow from operating the Company’s stores is a significant source of liquidity, and will continue to be used in 2005 primarily to purchase inventory, make capital improvements and open new stores. All of the Company’s revenues are realized at the point-of-sale in the stores.

Investing Activities

     Cash used in investing activities for the 13 weeks ended April 30, 2005 decreased by $27.0 million, to $25.6 million primarily reflecting the purchase of held to maturity securities in fiscal 2004 of $47.9 million partially offset by an increase in capital expenditures, net, of $18.3 million. Net capital expenditures increased $18.3 million due to an increase in capital expenditures of $11.2 million and a decrease in sale leaseback proceeds of $7.1 million. We use cash in investing activities to build new stores and remodel or relocate existing stores. Furthermore, net cash used in investing activities includes purchases of information technology assets and expenditures for distribution facilities and corporate headquarters. The following table presents the major categories of capital expenditure activities:

     We opened six stores and closed four Dick’s stores and one Galyan’s store during the 13 weeks ended April 30, 2005 compared to opening seven stores during the 13 weeks ended May 1, 2004. Sale-leaseback transactions covering store fixtures, buildings and information technology assets also have the effect of returning to the Company cash previously invested in these assets.

     Cash requirements in 2005, other than normal operating expenses, are expected to consist primarily of capital expenditures related to the addition of new stores, enhanced information technology and improved distribution infrastructure. The Company plans to open 25 new stores this year. The Company also anticipates incurring additional expenditures for remodeling or relocating certain existing stores. While there can be no assurance that current expectations will be realized, the Company expects net capital expenditures after landlord contributions in 2005 to be approximately $75 million.

Financing Activities

     Cash provided by financing activities for the 13 weeks ended April 30, 2005 decreased by $80.9 million to $73.4 million primarily reflecting the net proceeds from the senior convertible notes in fiscal 2004 offset by an increase in the change in the balance under the Revolving Credit Agreement in fiscal 2005 and increase in the bank overdraft. Financing activities consisted primarily of the borrowings under the Credit Agreement and proceeds from transactions in the Company’s common stock. The Company received proceeds of $3.0 million and $1.3 million from the exercise of employee stock options during the 13 weeks ended April 30, 2005 and the 13 weeks ended May 1, 2004, respectively.

     The Company’s liquidity and capital needs have generally been met by cash from operating activities, the proceeds from the convertible notes and borrowings under the $350 million Credit Agreement, including up to $75 million in the form of letters of credit. Borrowing availability under the Credit Agreement is generally limited to the lesser of 70% of the Company’s eligible inventory or 85% of the Company’s inventory’s liquidation value, in each case net of specified reserves and less any letters of credit outstanding. Interest on outstanding indebtedness under the Credit Agreement currently accrues, at the Company’s option, at a rate based on either (i) the prime corporate lending rate or (ii) at the LIBOR rate plus 1.25% to

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1.75% based on the level of total borrowings during the prior three months. The Credit Agreement’s term expires May 30, 2008.

     Borrowings under the Credit Agreement were $122.5 million and $76.1 million as of April 30, 2005 and January 29, 2005, respectively. Total remaining borrowing capacity, after subtracting letters of credit as of April 30, 2005 and January 29, 2005 was $185.8 million and $184.1 million, respectively.

     The Credit Agreement contains restrictions regarding the Company’s and related subsidiary’s ability, among other things, to merge, consolidate or acquire non-subsidiary entities, to incur certain specified types of indebtedness or liens in excess of certain specified amounts, to pay dividends or make distributions on the Company’s stock, to make certain investments or loans to other parties, or to engage in lending, borrowing or other commercial transactions with subsidiaries, affiliates or employees. Under the Credit Agreement, the Company may be obligated to maintain a fixed charge coverage ratio of not less than 1.0 to 1.0 in certain circumstances. The obligations of the Company under the Credit Agreement are secured by interests in substantially all of the Company’s personal property excluding store and distribution center equipment and fixtures. As of April 30, 2005, the Company was in compliance with the terms of the Credit Agreement.

     The Company believes that cash flows generated from operations, funds available under our Credit Agreement will be sufficient to satisfy our capital requirements through fiscal 2006. Other new business opportunities or store expansion rates substantially in excess of those presently planned may require additional funding.

Contractual Obligations and Other Commercial Commitments

     The only off-balance sheet contractual obligations and commercial commitments as of April 30, 2005 relate to operating lease obligations and letters of credit. The Company has excluded these items from the balance sheet in accordance with generally accepted accounting principles.

OUTLOOK

     Due to the Galyan’s acquisition, additional risk and uncertainties arise that could affect our financial performance and actual results and could cause actual results for fiscal 2005 and beyond to differ materially from those expressed or implied in any forward-looking statements included in this report or otherwise made by our management. These risks include those associated with combining businesses and achieving expected savings and synergies (including annualized cost savings and merchandise buying improvements) and/or with assimilating acquired companies and the fact that merger integration and store closing costs related to the Galyan’s acquisition are difficult to predict with a level of certainty and may be greater than expected. Additionally, there are various risks and uncertainties attributable to Galyan’s, many of which cannot be predicted, which could have a material affect on our business or operations.

     Since February 2005, we have completed the Galyan’s systems conversion to Dick’s systems and all of our stores are now on the same systems. From merchandising to allocations to the point of sale to warehouse management, we have eliminated duplicate systems and are now operating on a common platform. We have re-signed all of the Galyan’s stores as Dick’s stores in order to leverage the advertising spending in the markets where both Dick’s and Galyan’s operate stores, and we have also reset the interior of the former Galyan’s stores to optimize the space for the Dick’s merchandise assortment. All administrative functions and processes are run solely out of the Dick’s corporate headquarters as the former Galyan’s headquarters building has been closed.

     The conversion, re-merchandising, and grand re-opening of the former Galyan’s stores to Dick’s stores is essentially complete. We expect to be operating the former Galyan’s stores with the same merchandise assortments, financial discipline and customer service expectations as we have for the rest of our stores. Since the conversion is essentially completed, the former Galyan’s stores will be included in the comp store sales base beginning in the second quarter of fiscal 2006. The Company anticipates closing the final store due to the acquisition in the second quarter of 2005.

     The Company continues to expect total merger integration and store closing costs of approximately $70 million, of which $20 million was incurred in 2004. The Company estimates future merger costs of $5.5 million in the second quarter, and $39 million pre-tax for fiscal 2005, of which $32.5 million was incurred in the first quarter of 2005. The balance of the costs, which relate to future lease payments on closed stores, will be incurred in 2006 and beyond. Merger integration and store closing costs primarily include the expense of closing Dick’s stores, advertising the re-branding of Galyan’s stores, recruiting, system conversion costs, and duplicative costs such as corporate occupancy.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

     The Company’s net exposure to interest rate risk will consist primarily of borrowings under the Credit Agreement. The Company’s Credit Agreement bears interest at rates that are benchmarked either to U.S. short-term floating rate interest rates or one-month LIBOR rates, at the Company’s election. Outstanding borrowings under the Credit Agreement were $122.5 million and $76.1 million as of April 30, 2005 and January 29, 2005, respectively. The impact on the Company’s annual net income of a hypothetical one percentage point interest rate change on the April 2005 borrowings under the Credit Agreement would be approximately $0.7 million.

Credit Risk

     In February 2004, the Company sold $172.5 million issue price of senior unsecured convertible notes due 2024. In conjunction with the issuance of these senior convertible notes, we also entered into a five year convertible bond hedge and a separate five year warrant transaction with one of the initial purchasers (“the counterparty”) and/or certain of its affiliates. Subject to the movement in our common stock price, we could be exposed to credit risk arising out of net settlement of the convertible bond hedge and separate warrant transaction. Based on our review of the possible net settlements and the credit strength of the counterparty and its affiliates, we believe that we do not have a material exposure to credit risk as a result of these share option transactions.

Tax Matters

     Presently, the Company does not believe that there are any tax matters that could materially affect the consolidated financial statements.

Seasonality and Quarterly Results

     The Company’s business is subject to seasonal fluctuations. Significant portions of the Company’s net sales and profits are realized during the fourth quarter of the Company’s fiscal year, which is due, in part, to the holiday selling season and, in part, to our sales of cold weather sporting goods and apparel. Any decrease in fiscal fourth quarter sales, whether because of a slow holiday selling season, unseasonable weather conditions, or otherwise, could have a material adverse effect on our business, financial condition and operating results for the entire fiscal year.

ITEM 4. CONTROLS AND PROCEDURES

     An evaluation was performed of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by the report. This evaluation was conducted under the supervision and with the participation of the Company’s management, including its Chief Executive Officer and its Chief Financial Officer. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including cost limitations, judgments used in decision making, assumptions regarding the likelihood of future events, soundness of internal controls, fraud, the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can provide only reasonable, and not absolute, assurance of achieving their control objectives. Based on the evaluation, the Company’s Chief Executive Officer and its Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective in all material respects at a reasonable assurance level with respect to the recordings, processing, summarizing and reporting, within the time periods specified in the SEC’s rules and forms, of information required to be disclosed by us in the reports that we file or submit under the Exchange Act.

     There have been no changes in the Company’s internal controls over financial reporting that occurred during our most recent quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Galyan’s financial and merchandise systems were converted during the quarter, which eliminated duplicate systems and allows us to operate on a common platform.

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PART II. OTHER INFORMATION

ITEM 6. EXHIBITS

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SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on May 19, 2005 on its behalf by the undersigned, thereunto duly authorized.

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EXHIBIT INDEX

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