Sportsmans Guide (SGDE) 8-K The Sportsman’s Guide Releases Record 2005 Third Quarter Results

FOR:	THE SPORTSMAN’S GUIDE
	411 Farwell Avenue
	South Saint Paul, Minn. 55075	FOR IMMEDIATE RELEASE
	NASDAQ NMS: SGDE
CONTACT:	William P. Bartkowski
	MeritViewPartners
	612.605.8616

THE SPORTSMAN’S GUIDE RELEASES RECORD 2005 THIRD QUARTER RESULTS

EPS Higher Than Recent Guidance, 50% above Third Quarter One Year Ago and Up 70% Year-to-Date;
Sales and Internet-Related Sales Again Show Year Over-Year Increases

South St. Paul, Minn.(11/01/05)— The Sportsman’s Guide, Inc. (Nasdaq NMS: SGDE) today reported results for the quarter ended September 30, 2005 that, with respect to fully diluted earnings per share, were above most recent guidance, and set a record for the Company’s third quarter.

     Net sales for the Company’s third quarter were $61.5 million, compared with $57.0 million reported for the same period in 2004. The nearly 8% increase in consolidated net sales, year over year for the third quarter, was the result of sales growth at both The Golf Warehouse (“TGW”) and The Sportsman’s Guide (“TSG”). For the nine months ended September 30, 2005, net sales were $189.9 million, a 34% increase over the $141.4 million reported for the first three quarters of 2004.

     Net earnings for the quarter were $2.2 million, or $0.26 per fully diluted share, a 50% increase over the $1.4 million, or $0.17 per fully diluted share, reported for the same period in 2004. For the first three quarters of 2005, net earnings were $7.0 million, or $0.84 per fully diluted share, compared to $3.9 million, or $0.49 per fully diluted share for the first nine months of 2004, an increase of more than 70%. The earnings per share numbers for 2004 have been restated to reflect the Company’s change in accounting policy for Buyer’s Club revenues announced in June of this year and adjusted to reflect the 3-for-2 stock split, distributed April 15, 2005.

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     Gregory R. Binkley, President and Chief Executive Officer of the Company, stated, “We had another record quarter due to a continuation of the positive trends that have been affecting our business the last few years. We saw net sales growth at both TGW and TSG; with TGW’s growth especially strong. We also continued to generate high levels of Internet-related sales, as they once again totaled nearly 60% of total catalog and Internet sales for the quarter.”

     Binkley also noted that the recently completed quarter is the first where the results are comparable with those of the previous year given that the 2004 third quarter also included the results of The Golf Warehouse, acquired June 29, 2004.

     The Company will hold a conference call to discuss the results of the quarter at 10:30 am, CST, Wednesday, November 2, 2005. Gregory R. Binkley, President and Chief Executive Officer of the Company, and Charles B. Lingen, Executive Vice President and Chief Financial Officer, will be present on the call. Participants may access the call by dialing 1-800-362-0571 and asking for The Sportsman’s Guide conference call. The call may also be accessed via the Internet atwww.SportsmansGuideIR.com.

     The Sportsman’s Guide is an Internet and catalog retailer offering value-priced outdoor gear and general merchandise, with a special emphasis on outdoor clothing, outdoor equipment, golf apparel and equipment and footwear. The Company sells through both Internet Web sites and catalogs. The Company’s Web sites include www.sportsmansguide.com, www.tgw.com and http://www.bargainoutfitters.com.

- financial highlights to follow -

     This release contains forward looking statements which are subject to change based on various important factors, including but not limited to general economic conditions, a changing market environment for the Company’s products and the market acceptance of the Company’s catalogs, Internet sites and offerings.

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The Sportsman’s Guide, Inc. and Subsidiaries

Consolidated Balance Sheets
(UNAUDITED)

(In thousands of dollars)

	September 30,		September 30,		December 31,
	2005		2004		2004
			(Restated)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	2,221	$	715	$	8,616
Accounts receivable – net		3,044		2,725		3,955
Inventory		44,351		38,439		29,148
Promotional material		5,649		3,999		3,578
Prepaid expenses and other		3,811		2,650		3,123
Income taxes receivable		—		1,505		—
Deferred income taxes		1,645		1,096		1,767
Total current assets		60,721		51,129		50,187
PROPERTY AND EQUIPMENT, NET		2,432		2,691		2,693
OTHER ASSETS
Goodwill		17,199		17,219		17,176
Trade and domain name		10,200		10,200		10,200
Other intangibles		1,248		714		658
Total other assets		28,647		28,133		28,034
Total assets	$	91,800	$	81,953	$	80,914
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Bank overdraft	$	—	$	3,246	$	—
Revolving credit line		4,135		4,470		—
Note payable – bank		—		2,500		—
Accounts payable		24,194		20,657		23,832
Accrued expenses and other current liabilities		17,321		15,274		21,822
Total current liabilities		45,650		46,147		45,654
LONG-TERM LIABILITIES		5,810		10,267		5,388
Total liabilities		51,460		56,414		51,042
SHAREHOLDERS’ EQUITY		40,340		25,539		29,872
Total liabilities and shareholders’ equity	$	91,800	$	81,953	$	80,914

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The Sportsman’s Guide, Inc. and Subsidiaries

Consolidated Statements of Earnings
(UNAUDITED)

For The Three Months And Nine Months Ended
September 30, 2005 and 2004

(In thousands, except per share data)

	Three months ended						Nine months ended
	September 30,						September 30,
	2005			2004			2005			2004
				(Restated)						(Restated)
Net sales	$	61,549		$	57,039		$	189,905		$	141,403
Cost of sales		42,060			40,139			130,938			97,329
Gross profit		19,489			16,900			58,967			44,074
Selling, general and administrative expenses		15,983			14,564			47,931			37,839
Earnings from operations		3,506			2,336			11,036			6,235
Interest expense		(67	)		(168	)		(213	)		(168	)
Other income (expense), net		23			—			182			80
Earnings before income taxes		3,462			2,168			11,005			6,147
Income tax expense		1,273			791			4,052			2,222
Net earnings	$	2,189		$	1,377		$	6,953		$	3,925
Net earnings per share:
Basic	$	.30		$	.20		$	.97		$	.55
Diluted	$	.26		$	.17		$	.84		$	.49
Weighted average common and common equivalent shares outstanding:
Basic		7,314			7,052			7,180			7,078
Diluted		8,457			7,968			8,233			7,980

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