Guitar Center 8-K Other events

Exhibit 99.2

Guitar Center, Inc. and subsidiaries

Consolidated Balance Sheets

(In thousands, except per share amounts)

(Unaudited)

	September 30, 2003			December 31, 2002
Assets
Current assets:
Cash	$	4,701		$	5,931
Accounts receivable, net	19,103			19,762
Merchandise inventories	290,610			292,075
Prepaid expenses and deposits	9,354			8,626
Deferred income taxes	6,077			6,077
Total current assets	329,845			332,471
Property and equipment, net	91,509			89,702
Goodwill	25,995			25,995
Deposits and other assets, net	6,468			4,231
	$	453,817		$	452,399
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	52,863		$	70,745
Accrued expenses and other current liabilities	51,164			54,211
Merchandise advances	13,196			13,882
Revolving line of credit	42,345			82,690
Current portion of long-term debt	—			118
Total current liabilities	159,568			221,646
Other long-term liabilities	5,923			5,691
Deferred income taxes	3,352			3,352
Long-term debt	100,000			66,782
Total liabilities	268,843			297,471
Stockholders’ equity:
Preferred Stock; authorized 5,000 shares at September 30, 2003 and December 31, 2002, none issued and outstanding	—			—
Common Stock, $0.01 par value, authorized 55,000 shares, issued and outstanding 23,625 at September 30, 2003 and 22,746 at December 31, 2002	236			227
Additional paid in capital	266,692			253,863
Accumulated deficit	(81,954		)	(99,162		)
Total stockholders’ equity	184,974			154,928
	$	453,817		$	452,399

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Guitar Center, Inc. and subsidiaries

Consolidated Statements of Income

(In thousands, except per share data)

(Unaudited)

	Three months ended September 30,
	2003		2002
Net sales	$	300,112	$	257,356
Cost of goods sold, buying and occupancy	220,261		191,258
Gross profit	79,851		66,098
Selling, general and administrative expenses	66,182		55,662
Operating income	13,669		10,436
Interest expense, net	4,335		3,393
Income before income taxes	9,334		7,043
Income taxes	3,553		2,681
Net income	$	5,781	$	4,362
Net income per share
Basic	$	0.25	$	0.19
Diluted	$	0.23	$	0.19
Weighted average shares outstanding
Basic	23,430		22,810
Diluted	24,944		23,388

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	Nine months ended September 30,
	2003		2002
Net sales	$	879,254	$	766,066
Cost of goods sold, buying and occupancy	649,197		570,432
Gross profit	230,057		195,634
Selling, general and administrative expenses	191,846		166,866
Operating income	38,211		28,768
Interest expense, net	10,430		9,556
Income before income taxes	27,781		19,212
Income taxes	10,573		7,312
Net income	$	17,208	$	11,900
Net income per share
Basic	$	0.75	$	0.53
Diluted	$	0.71	$	0.51
Weighted average shares outstanding
Basic	23,075		22,523
Diluted	24,329		23,133

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