The November sale of the company’s Athletic Training Equipment Company division to Wilson Team Sports has enabled Sport Supply Group to post a net gain in earnings for its fiscal third quarter ended December 26.

The $3.2 million gain on discontinued operations from the ATEC sale and discontinuing or selling certain of its team dealer operations pushed SSPY into the black, posting net income of $581,000, or 7 cents a share, versus a loss of $2.4 million, or 26 cents a share, in the year-ago period. Net revenues were $14.7 million for the quarter, down 2.6% from net sales of $15.1 million in the year-ago period. Internet orders increased 36.3% to $1.5 million for the quarter. Gross margins shrunk 40 basis points to 25.5% for the quarter. The decline was attributed to “aggressive competitive pricing” and “increased costs associated with freight and import expenses”.

Inventories were reduced 9.2% at quarter-end to $17.7 million while accounts receivables fell 57.8% to $8.6 million based on the ATEC sale and other divestitures.

The company is caught up in bankruptcy proceedings of a freight carrier and a freight billing processor. The billing processor, which is now in Ch. 7, allegedly failed to pass on payments to carriers and has been forced to pay nearly $600k in fees they already paid to the processor. The carrier’s trustee in that Chapter 11 case has filed an $867k claim against SSPY.