Gander Mountain Company reported total sales for the first quarter of fiscal 2004 increased 42%, or $29.3 million, to $98.7 million. Comparable store sales increased 8.7%. The net loss for the quarter was $13.6 million compared with a net loss of $11.2 million in the first quarter of fiscal 2003.
“We were satisfied with Gander Mountain's progress in the quarter. Strong sales growth reflects our emphasis on both comparable store performance and new store development,” said Mark Baker, President and CEO. “Gander Mountain is a highly-seasonal business both because of our hunting, fishing and camping emphasis and because of the concentration of our current stores in northern states. First quarter results were consistent with our expectations and keep us on track to meet our overall financial plan for 2004.”
On April 26, 2004, Gander Mountain closed its initial public offering of 6,583,750 shares of its common stock at a price of $16.00 per share and converted existing preferred stock to common stock. On a GAAP basis, the per share net loss for the quarter was $10.52 per common share compared with a net loss of $15.80 per common share in the first quarter of fiscal 2003. Giving effect to the conversion of preferred shares and the application of the net proceeds of the offering as of the beginning of each period presented, pro forma net loss for the first quarter was $12.7 million, or $0.89 per share, compared to a pro forma net loss of $10.7 million, or $0.89 per share, for the first quarter of last year.
During the first quarter of fiscal 2004, the Company opened a store in Middletown, New York and another in Novi, Michigan, bringing total square footage to 2.7 million, an increase of 42% over the prior year. At May 1, 2004, the Company operated 67 stores in nine states.
“As Gander Mountain begins its life as a public company, we are well positioned to carry out our accelerated growth program,” Baker continued. “Estimated at over $30 billion annually, the outdoor lifestyle category offers great opportunities for a value-driven, service-focused retailer like Gander Mountain. Our 4,000 dedicated associates continue to lead our industry in serving the needs of every Gander Mountain customer.”
Fiscal 2004 Outlook
The Company's current outlook for fiscal 2004 is based on current expectations and includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act as described later in this release.
Full Fiscal Year 2004
* Sales are expected to reach $650-$700 million, an increase of 33% to
43% over fiscal 2003.
* Comparable store sales are expected to increase by approximately
3% to 5%.
* Income before income taxes is expected to be $16- $21 million, compared
with $1.5 million in fiscal 2003.
* The Company expects to open at least 15 new stores, including two
relocations, during the year, representing incremental square footage
of approximately 1.0 million square feet.Gander Mountain Company
Statement of Operations - Unaudited
(In thousands, except per share data)13 Weeks Ended
May 1, May 3,
2004 2003Sales $ 98,719 $ 69,427
Cost of goods sold 79,452 57,304
Gross profit 19,267 12,123Operating expenses:
Store operating expenses 23,632 16,160
General and administrative expenses 6,498 5,074
Pre-opening expenses 1,230 1,320
Loss from operations (12,093) (10,431)
Interest expense, net 1,503 816
Loss before income taxes (13,596) (11,247)
Income tax provision (benefit) - -
Net loss (13,596) (11,247)Less preferred stock dividends 4,305 4,131
Loss applicable to common shareholders $ (17,901) $ (15,378)
Basic and diluted loss applicable to
common shareholders per share $ (10.52) $ (15.80)Weighted average common shares
outstanding 1,701 973Pro Forma Data (1)
Pro forma net loss applicable to
common shareholders $ (12,654) $ (10,695)
Pro forma basic and diluted loss
applicable to common shareholders
per share $ (0.89) $ (0.89)
Pro forma weighted average common
shares outstanding 14,222 12,081Reconciliation of Pro Forma Data to
GAAP
Loss applicable to common shareholders $ (17,901) $ (15,378)
Preferred stock dividends 4,305 4,131
Interest expense reduction 942 552
Pro forma net loss applicable to
common shareholders $(12,654) $(10,695)Weighted average common shares
outstanding 1,701 973
Conversion of preferred stock 6,299 6,665
Additional shares issued in IPO 6,222 4,443
Pro forma weighted average common
shares outstanding 14,222 12,081
