Big 5 Sporting Goods Corporation reported that it achieved its 38th consecutive quarter of positive same store sales performance for the fiscal quarter ended July 3, 2005. The company expects to report, based upon preliminary sales results, a same store sales increase of approximately 2.7% for the second fiscal quarter versus the comparable 13-week period of 2004.
The company also announced that it will delay reporting its preliminary results for the fiscal 2005 second quarter until it completes its financial statements for the fiscal year ended January 2, 2005 and its previously announced restatement of its financial statements for the fiscal years ended December 28, 2003 and December 29, 2002, as well as its quarterly financial statements for fiscal 2002, fiscal 2003 and fiscal 2004. The previously announced restatement adjustments relate to the correction of an error in an account within accounts payable, an adjustment to accounting for certain leases and the spreading over appropriate periods of the company's prior implementation of a sales return reserve in the third quarter of fiscal 2004. In addition, also as previously announced, the company and its independent professional advisors have been conducting a review of the company's prior financial statements on behalf and under the supervision of the Audit Committee. While the review is not yet complete, the company currently expects that additional corrections to its prior financial statements will be required as part of the restatement. The company believes that the cumulative, net impact on the company's net income of the additional corrections that the company is aware of at this time, as well as the adjustments relating to the previously announced lease accounting changes and sales return reserve, for fiscal years 2002 through 2004 will be less than 3% of aggregate net income as preliminarily reported on February 9, 2005 for such fiscal year periods, which reflected the preliminary adjustments to address the error in an account within accounts payable. These matters will also reduce net income for prior periods, which the company anticipates will be reflected in an opening balance sheet adjustment for fiscal 2002.
Steven G. Miller, Big 5's chairman, president and chief executive officer, said, “While I recognize that the restatement process has been frustrating for our shareholders, we are hopeful that this process is drawing to a close. Although significant time and attention has been devoted to the restatement process, we have remained focused on our business and are pleased to have maintained our consistent same store sales performance and to have achieved our 38th consecutive quarter of comp store sales increases. We are also pleased to report that the transition to our new distribution center in Riverside, California is proceeding smoothly in accordance with our plans.”
