Sport Supply Q4 and 2006 Net More than Doubles

Sport Supply Group, Inc. reported a 3.4% growth in revenues for the fiscal fourth quarter to $24.0 million from $23.2 million last year. Net income jumped 168% to $1.7 million from $621,000 for the fourth quarter last year.For the full year, revenues grew 4.6% to $92.2 million from $88.1 million last year. Net income jumped 223% for the year to $4.5 million from $1.4 million during 2005.

Terry Babilla, the Company’s President and Chief Operating Officer, commented, “We achieved significant improvement from the prior year in virtually all measures of financial performance for the three and twelve month periods ended June 30, 2006. Our results reflect organic revenue growth and significant improvements in margins, operating income, net income and earnings per share.

In addition to strong operating results, the Company’s balance sheet is in excellent condition, with stockholders’ equity increasing from $29.0 million on June 30, 2005 to $33.6 million on June 30, 2006. In addition, the Company has repaid all of its bank debt under its $20 million line of credit and should be able to generate significant future cash savings because the Company’s net deferred tax assets of approximately $7.6 million (which include a $4.3 Million valuation allowance) will be used to offset future income taxes.”

Mr. Babilla concluded by stating that, “We will continue to focus our attention on increasing our profitable revenues by improving our selling and marketing efforts, entering into strategic relationships, expanding our gross margins and eliminating unnecessary expenses through the use of technology.”