Collegiate Pacific Inc. preliminary unaudited results for the fiscal fourth quarter and year ended June 30, 2006 and earnings guidance for FY07 which began July 1, 2006. The Company also announced it had submitted an offer to the Special Committee of Sport Supply Group, Inc. to purchase the remaining shares of Sport Supply Group it does not currently own for a value of $8.80 per Sport Supply Group share of common stock.
Regarding Q406 preliminary results, the company currently expects to report revenues of approximately $53 million and a loss in the range of $700,000 to $1.1 million for its 2006 fourth quarter and revenues of approximately $224 million and earnings of approximately $1.7 million to $2.1 million for the year ended June 30, 2006. Results for the fourth quarter were adversely affected by a $5.3 million increase in the sequential unshipped backlog from March 31, 2006 to June 30, 2006 and additional platform-building expenses incurred to support future growth. The higher level of backlog is believed to be mostly the result of football uniform customers taking their deliveries closer to the start of the school season, and a delay in the completion of several large installation jobs from our west coast subsidiary. The Company anticipates much of this backlog to be relieved in the coming quarters.
Regarding FY07 guidance, the company projects revenues of approximately $250 million and Fully Diluted GAAP EPS in the range of 52 cents to 64 cents. This guidance assumes no change in the company’s current 73.2% ownership of Sport Supply Group, Inc. during FY07.
Regarding Sport Supply Group, Inc., the company announced it had submitted an offer to the Special Committee of Sport Supply Group to purchase the remaining shares it does not currently own for a value of $8.80 per Sport Supply Group share, comprised of $1.76 per share in cash and the remainder in BOO common stock and/or cash at the Company’s election. Sport Supply Group formed the Special Committee to evaluate the Company’s confidential prior proposal in March 2006 to acquire the Sport Supply Group shares, and the Company and the Sport Supply Group Special Committee have continued to engage in discussions since that time. While the Company is hopeful to move forward towards a mutually acceptable definitive merger agreement in the future, the offer is subject to the approval of the Special Committee and the Company’s Board of Directors and there can be no assurance that a definitive merger agreement will be executed or that the merger will be completed.