FOR: THE SPORTSMAN'S GUIDE
411 Farwell Avenue
South Saint Paul, Minn. 55075 FOR IMMEDIATE RELEASE
NASDAQ NMS: SGDE
CONTACT: 612-344-1000
William P. Bartkowski
BlueFire Partners
612-344-1012 (direct)
THE SPORTSMAN'S GUIDE RELEASES 2004 THIRD QUARTER RESULTS
Consolidated Net Earnings Up Nearly 51% On Sales Growth of 37%; Acquisition
of TGW and Strong Internal Growth Fuel Record Results
SOUTH ST. PAUL, MINN. (11/02/04) -- The Sportsman's Guide, Inc. (NASDAQ
NMS: SGDE) today reported record results of operations for the quarter ended
September 30, 2004. Sales for the quarter were $56.6 million, a 37% increase
over the $41.2 million reported for the same period one year ago. The Company
reported net earnings of $1.1 million, and earnings of $0.20 per fully diluted
share for the quarter, compared to $710,000, or $0.13 per fully diluted share,
reported for the three months ended September 30, 2003.
For the nine months ended September 30, 2004, sales were $140.0
million, an increase of just under 14% when compared to the $123.0 million
reported for the same period in 2003. The Company recorded net earnings of $3.0
million, or $0.57 per fully diluted share, for the first three quarters of the
year, compared to net earnings of $2.3 million, or $0.44 per fully diluted
share, for the first nine months ended September 30, 2003.
Company officials noted that the increase in sales for the third
quarter of 2004 was due to the acquisition of The Golf Warehouse, TGW.com, on
June 29, 2004 and increases in Internet-related sales for the Company's base
business. Sales at the base business grew 8% and its Internet-related sales were
in excess of 41% of total sales in the quarter, compared to approximately 36% of
total sales for the same period in 2003.
Gregory R. Binkley, President and Chief Executive Officer of the
Company, stated, "The strong results for the quarter were driven by two key
factors. The first is our early summer acquisition of The Golf Warehouse. It
performed extremely well in the period. In addition, we have also seen year over
year improvements in sales and in Internet-related sales in our base business
that are encouraging."
Binkley went on to state, "The addition of TGW, with the majority of
its sales generated through the Internet, has changed our Company's profile as
we are now more of an on-line retailer than we were previously."
The Company will hold a conference call on Wednesday, November 3, 2004
to discuss the results of the quarter. Gregory R. Binkley, President and Chief
Executive Officer, and Charles B. Lingen, Executive Vice President and Chief
Financial Officer, will be present on the call to provide commentary and to take
questions. The call will be begin at 10:30 am, CST. Participants may access the
call by dialing 1-800-209-8032. The call may also be accessed via the Internet
at www.SportsmansGuideIR.com.
The Sportsman's Guide offers value-priced outdoor gear and general
merchandise, with a special emphasis on outdoor clothing, equipment and
footwear, through direct mail catalogs and two Internet sites. On June 29, 2004
the Company acquired The Golf Warehouse, TGW.com, the Wichita, Kansas-based
leading online and catalog retailer of golf equipment, apparel and accessories.
The Company's e-commerce websites include www.sportsmansguide.com,
www.bargainoutfitters.com and www.TGW.com. Investor information is available on
the Company's investor relations website: www.SportsmansGuideIR.com.
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.
-- financial highlights follow --
THE SPORTSMAN'S GUIDE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands of dollars)
September 30, September 30, December 31,
2004 2003 2003
---- ---- ----
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 715 $10,810 $32,054
Accounts receivable -- net 2,725 1,853 3,034
Inventory 38,439 29,710 18,874
Promotional material 3,999 3,920 2,565
Prepaid expenses and other 2,650 2,020 1,871
Income taxes receivable 1,505 -- --
Deferred income taxes 951 2,270 3,176
------- ------- -------
Total current assets 50,984 50,583 61,574
PROPERTY AND EQUIPMENT, NET 2,691 2,296 2,248
OTHER ASSETS
Goodwill 17,219 -- --
Trade and domain name 10,200 -- --
Non-compete agreements, net 475 -- --
Customer lists, net 229 -- --
Other 10 -- --
------- ------- -------
Total other assets 28,133 -- --
------- ------- -------
Total assets $81,808 $52,879 $63,822
======= ======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Bank overdraft $ 3,246 $ -- $ --
Revolving credit line 4,470 -- --
Note payable - bank 2,500 -- --
Accounts payable 20,657 18,463 18,950
Accrued expenses and other
current liabilities 14,829 11,545 17,877
------- ------- -------
Total current liabilities 45,702 30,008 36,827
LONG-TERM LIABILITIES 10,267 246 187
------- ------- -------
Total liabilities 55,969 30,254 37,014
SHAREHOLDERS' EQUITY 25,839 22,625 26,808
------- ------- -------
Total liabilities and
shareholders' equity $81,808 $52,879 $63,822
======= ======= =======
THE SPORTSMAN'S GUIDE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
For The Three Months And Nine Months Ended
September 30, 2004 and 2003
(In thousands, except per share data)
Three months ended Nine months ended
September 30, September 30,
------------------ ------------------
2004 2003 2004 2003
---- ---- ---- ----
Sales $ 56,554 $ 41,213 $ 140,009 $ 123,003
Cost of sales 40,139 28,672 97,329 84,321
--------- --------- --------- ---------
Gross profit 16,415 12,541 42,680 38,682
Selling, general and administrative expenses 14,564 11,424 37,839 35,056
--------- --------- --------- ---------
Earnings from operations 1,851 1,117 4,841 3,626
Interest expense 168 -- 168 --
Miscellaneous income (expense), net -- (10) 80 (14)
--------- --------- --------- ---------
Earnings before income taxes 1,683 1,107 4,753 3,612
Income tax expense 614 397 1,720 1,299
--------- --------- --------- ---------
Net earnings $ 1,069 $ 710 $ 3,033 $ 2,313
========= ========= ========= =========
Net earnings per share:
Basic $ .23 $ .15 $ .64 $ .49
========= ========= ========= =========
Diluted $ .20 $ .13 $ .57 $ .44
========= ========= ========= =========
Weighted average common and common equivalent
shares outstanding:
Basic 4,701 4,801 4,719 4,769
========= ========= ========= =========
Diluted 5,312 5,355 5,320 5,241
========= ========= ========= =========
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