FOR FURTHER INFORMATION:
At the Company:
Geoffrey Jurick, CEO and President, or
Terry Babilla, COO
Bob Mitchell, CFO
972-484-9484
FOR IMMEDIATE RELEASE
Tuesday November 11, 2003
Sport Supply Group Announces
Fiscal 2004 Second Quarter Results
DALLAS--(BUSINESS WIRE)--Nov. 11, 2003--Sport Supply Group, Inc. (OTCBB:SSPY), a leading institutional sporting goods distributor, today announced results for the three and six months ended September 26, 2003.Revenues remained relatively the same for the three and six months ended September 2003. Gross profits as a percentage of revenues declined from 30.7% and 30.5% to 28.2% and 28.3% for the three and six months ended September 2003 and September 2002, respectively, primarily due to aggressive competitive pricing and increased importing costs. Selling, general and administrative expenses continue to show significant reductions from the prior year due to the effects of previously implemented and ongoing cost reduction programs. Net income (loss) from continuing operations showed a $41,000 and $108,000 decline for the three and six months ended September 2003.
During the September quarter, the Company began closing certain of its team dealer operations, with the sale of substantially all the assets (other than accounts receivable) of its team dealer located in Little Rock, Ark. This sale resulted in a year-to- date after tax charge to earnings of $289,000. Subsequent to the September quarter, the Company discontinued its team dealer operations in Enid, Okla. and Wichita, Kan. The prior year six-month period reflects a one-time, $7.4 million non-cash charge associated with the cumulative accounting effect of implementing Financial Accounting Standards Board Statement 142 (Accounting for Goodwill and Other Intangible Assets).
Geoffrey P. Jurick, Chairman & Chief Executive Officer and President of Sport Supply Group, Inc. stated, "We are pleased with the revenue stabilization and continued operating cost efficiencies at Sport Supply Group. We believe the future closing of our Oklahoma and Kansas team dealer locations will enable us to focus more resources on our core institutional sporting goods market."
Sport Supply Group is a leading direct marketer and B2B e-commerce supplier of sporting goods equipment to the institutional and youth sports market place. Athletes, coaches and instructors in schools, colleges, universities, governmental agencies, camps and youth organizations across the country use the Company's products.
For more information about Sport Supply Group or to sign up as an associate for your organization's own on-line sporting goods store, please visit www.sportsupplygroup.com.
This news release, other than the historical information, consists of forward-looking statements that involve risks and uncertainties detailed from time to time in the Company's filings with the Securities and Exchange Commission, including the Company's Reports on Form 10-K and Form 10-Q. Such forward-looking statements are made based on management's belief as well as assumptions made by, and information currently available to, management pursuant to the 'safe harbor' provisions of the Private Securities Litigation Reform Act of 1995. Actual results may vary materially.
SPORT SUPPLY GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) Three Months Ended Six Months Ended September September September September 2003 2002 2003 2002 ------------ ------------ ------------ ------------ Net revenues $25,896,678 $25,544,214 $51,687,793 $51,951,454 Cost of sales 18,585,257 17,696,357 37,044,925 36,088,743 ------------ ------------ ------------ ------------ Gross profit 7,311,421 7,847,857 14,642,868 15,862,711 Selling, general & administrative expenses 7,213,591 7,693,840 14,171,971 15,187,774 Operating income 97,830 154,017 470,897 674,937 Interest expense (150,080) (147,095) (299,518) (315,224) Other income (expense), net (1,447) 3,953 11,741 (3,994) ------------ ------------ ------------ ------------ Income before income taxes, discontinued operations and cumulative effect of accounting change (53,697) 10,875 183,120 355,719 (Provision for) benefit of income taxes for continuing operations 19,868 (4,024) (68,909) (133,931) Income from continuing operations (33,829) 6,851 114,211 221,788 Discontinued operations, net of tax (256,428) 15,374 (289,425) 10,158 Cumulative effect of accounting change -- -- -- (7,442,432) ------------ ------------ ------------ ------------ Net income (loss) $(290,257) $22,225 $(175,214) $(7,210,486) ============ ============ ============ ============ Basic earnings (loss) per share: Income from continuing operations $(0.00) $0.00 $0.01 $0.02 Discontinued operations (0.03) 0.00 (0.03) 0.00 Cumulative effect of accounting change 0.00 0.00 0.00 (0.83) ------------ ------------ ------------ ------------ Basic loss per share $(0.03) $0.00 $(0.02) $(0.81) ============ ============ ============ ============ Diluted earnings (loss) per share: Income from continuing operations $(0.00) $0.00 $0.01 $0.02 Discontinued operations (0.03) 0.00 (0.03) 0.00 Cumulative effect of accounting change 0.00 0.00 0.00 (0.83) ------------ ------------ ------------ ------------ Diluted loss per share $0.03) $0.00 $(0.02) $(0.81) ============ ============ ============ ============ Weighted average common shares outstanding Basic 8,917,244 8,917,244 8,917,244 8,917,244 Diluted 8,917,244 8,917,244 8,917,244 8,917,244 SPORT SUPPLY GROUP, INC. AND SUBSIDIARIES CONSOLIDATED SUMMARY BALANCE SHEETS (UNAUDITED) September 26, March 28, 2003 2003 ----------------- ---------------- Cash and cash equivalents 787,352 2,142,302 Accounts receivable 15,496,663 20,245,675 Inventory 18,325,469 19,564,314 Other current assets 2,301,979 2,102,125 ----------------- ---------------- Total current assets 36,911,463 44,054,416 Plant, property and equipment 7,764,132 8,519,936 Other assets 8,949,148 9,421,287 ----------------- ---------------- Total assets 53,624,743 61,995,639 ----------------- ---------------- Current liabilities 12,225,469 16,338,359 Long term debt 13,528,961 17,611,753 Stockholder's equity 27,870,313 28,045,527 ----------------- ---------------- Total liabilities and equity 53,624,743 61,995,639 ----------------- ----------------Please refer to our Form 10-Q as filed with the SEC for more in depth financial and company information.