Gander Mountain Company reported sales of $269.9 million for the quarter ended Nov. 1, 2008, an increase of 4% over the prior year period. Comparable store sales decreased 6.5% in the third quarter. Net income for the third quarter was $770,000, or 3 cents per share, compared to a net loss of $5.1 million, or 25 cents per share, a year ago.


The 2008 period includes $14.4 million in revenue due to the expansion of the company's direct marketing business through Overton's. Per share information for the most recent quarter reflects the issuance of an additional 4,067,797 shares of common stock in Dec. 2007, the proceeds of which were used to partially fund the Overton's acquisition.

For the 39 weeks ended Nov. 1, 2008, the company reported sales of $730.5 million, an increase of 12.1% over the comparable period in 2007. The company reported a net loss for the 39-week period of $28.5 million, or $1.18 per share, compared with a net loss of $37.6 million, or $1.86 per share, for the 39 weeks ended Nov. 3, 2007.


Financial highlights for the third quarter:



  • On retail segment sales of $256 million, a 1.6% decrease, retail segment net income increased to $3.7 million compared to a net loss of $5.1 million for the comparable quarter of fiscal 2007.
  • Retail segment SG&A costs improved $7.9 million, or 272 basis points as a percentage of sales, in the third quarter of fiscal 2008 due to cost reductions in both store operating and general and administrative expenses. However, included in consolidated SG&A expenses were $8.0 million in expenses related to the direct segment, thus consolidated SG&A expenses were flat year over year.
  • Current availability under the company's existing credit facility at Dec. 5, 2008 was $59 million as compared with $54 million as of Dec. 7, 2007.

“While the current retail environment is as difficult as any in recent memory, our efforts to conserve costs, improve operating margins, reduce capital expenditures and improve operating cash flows have borne results,” said David C. Pratt, Chairman and interim CEO. “We are applying a more disciplined approach to our operations, capital, and expense decisions and we remain pleased with the operational progress visible in these results at Gander Mountain.”


                           Gander Mountain Company

              Consolidated Statements of Operations – Unaudited

                    (In thousands, except per share data)


                                         13 Weeks Ended      39 Weeks Ended

                                       November  November  November  November

                                          1,        3,        1,        3,

                                         2008      2007      2008      2007

    Sales                              $269,920  $259,539  $730,455  $651,799

    Cost of goods sold                  200,160   189,445   551,183   496,293

    Gross profit                         69,760    70,094   179,272   155,506

    Operating expenses:

      Selling, general and

       administrative expenses           64,975    64,946   190,871   171,754

      Exit costs, impairment and other

       charges                           (1,112)    1,582       (20)    2,208

      Pre-opening expenses                  –       3,041     2,035     4,753

    Income (loss) from operations         5,897       525   (13,614)  (23,209)

    Interest expense, net                 4,950     5,543    14,301    14,049

    Income (loss) before income taxes       947    (5,018)  (27,915)  (37,258)

    Income tax provision                    182       125       619       375

    Net Income (loss)                      $765   $(5,143) $(28,534) $(37,633)


    Basic and diluted loss per common

     share                                $0.03    $(0.25)   $(1.18)   $(1.86)


    Weighted average common shares

     outstanding                         24,162    20,362    24,086    20,255