Gander Mountain Company first quarter sales increased 13.0% to $175.7 million and comparable store sales increased 1.0% versus the first quarter of the prior year. Losses from operations were $18.9 million, or 10.7% of sales, versus $19.0 million, or 12.2% of sales for the comparable period. For the quarter, the company reported a net loss of $22.8 million, or $1.14 per diluted share, compared to a net loss of $23.0 million, or $1.61 per diluted share, in the first quarter of fiscal 2006.

“In the first quarter, we demonstrated progress by reducing losses in what historically has been our seasonally smallest period while operating a higher number of stores. Though the gains were small, this is the first time as a public company that Gander Mountain has improved operating performance in the first quarter versus the prior year,” said Mark Baker, president and CEO. “We were pleased by the regional strength in our growing number of southern stores and by initial performance in our new offering of Tracker Marine Group boats at selected stores. Both these trends are evidence of the operating momentum we are gaining from our merchandising initiatives and geographic diversification strategy.”

    First Quarter 2007 Financial Highlights:
    -- The company opened one replacement store during the first quarter,
       bringing the number of stores operated at the close of the first
       quarter to 105.  For all of fiscal 2007, the company plans to open a
       total of 13 stores, including three replacement stores, bringing total
       stores operated at year end to 115.
    -- For the quarter, operating losses improved to $18.9 million with six
       incremental stores open year over year.
    -- Gross profit increased 25.5 percent to $33.9 million for the quarter.
       As a percent of sales, gross profit increased 190 basis points to 19.3
    -- Store operating expenses were $40.6 million for the quarter. Included
       in store operating expenses was approximately $800,000 related to the
       company's addition of the new Tracker Marine Group product line.  As a
       percent of sales, store operating expenses were flat for the quarter.
    -- In the first quarter, general and administrative expense (G&A) was
       $11.5 million. As a percent of sales, G&A increased 50 basis points to
       6.5 percent reflecting increased investment in technology and severance

                           Gander Mountain Company
                     Statements of Operations - Unaudited
                    (In thousands, except per share data)

                                                        13 Weeks Ended
                                                   May 5,           April 29,
                                                    2007               2006
           Sales                                  $175,749          $155,581
           Cost of goods sold                      141,872           128,589
           Gross profit                             33,877            26,992
           Operating expenses:
              Store operating expenses              40,552            35,855
              General and administrative
               expenses                             11,450             9,353
              Pre-opening expenses                     730               765
           Loss from operations                    (18,855)          (18,981)
           Interest expense, net                     3,976             3,986
           Loss before income taxes                (22,831)          (22,967)
           Income tax provision                         --                --
           Net income (loss)                      $(22,831)         $(22,967)

           Basic and diluted loss per
            share                                   $(1.14)           $(1.61)

           Weighted average common shares
            outstanding                             20,089            14,285