Winmark Corp., the parent of Play it Again Sports, reported net income rose 3% in the third quarter ended September 27, to $1.35 million, or 24 cents a share, from $1.13 million, or 20 cents, in 2007. Revenues climbed 14.8% to $9.12 million from $7.95 million.


For the nine months ended September 27, net income rose to $3.22 million, or 58 cents a share, from $2.19 million, or 39 cents, a year ago. Revenues grew 15.5% to $26.72 million from $23.14 million.

 

John L. Morgan, chairman and CEO, stated, “Our results were favorable due to the strength of our retail brands and the skill and hard work of our franchisees. Our leasing business did not grow in this quarter and we do not expect fast growth in this tough economic environment.”

 

At September 27, Winmark had 866 franchises in operation under the brands Play It Again Sports, Once Upon A Child, Plato’s Closet and Music Go Round.

 
















  WINMARK CORPORATION
                      CONDENSED STATEMENTS OF OPERATIONS
                                 (Unaudited)

                             Quarter Ended             Nine Months Ended
                      September 27, September 29,  September 27, September 29,
                          2008          2007           2008          2007
    REVENUE:
      Royalties         $5,740,600   $5,208,700    $16,376,000   $15,208,100
      Leasing income     2,060,400    1,173,200      5,920,000     2,944,700
      Merchandise sales    777,600      797,600      2,685,400     3,250,300
      Franchise fees       431,900      584,100      1,345,500     1,301,500
      Other                117,700      188,200        396,000       436,700
        Total revenue    9,128,200    7,951,800     26,722,900    23,141,300
    COST OF MERCHANDISE
     SOLD                  730,800      764,300      2,565,400     3,119,500
    LEASING EXPENSE        471,000      268,700      1,420,000       601,900
    PROVISION FOR CREDIT
     LOSSES                571,800      142,100      1,226,100       421,800
    SELLING, GENERAL AND
     ADMINISTRATIVE
     EXPENSES            4,744,100    4,587,500     15,068,400    14,390,400
        Income from
         operations      2,610,500    2,189,200      6,443,000     4,607,700
    LOSS FROM EQUITY
     INVESTMENTS          (145,200)     (92,400)      (281,700)     (344,600)
    INTEREST EXPENSE      (309,600)    (381,300)      (998,200)   (1,101,900)
    INTEREST AND OTHER
     INCOME                114,500      122,500        246,300       423,300
        Income before income
         taxes           2,270,200    1,838,000      5,409,400     3,584,500
    PROVISION FOR INCOME
     TAXES                (919,400)    (706,500)    (2,190,800)   (1,392,700)
    NET INCOME          $1,350,800   $1,131,500     $3,218,600    $2,191,800
    EARNINGS PER SHARE —
     BASIC                    $.24         $.21           $.58          $.40
    EARNINGS PER SHARE —
     DILUTED                  $.24         $.20           $.58          $.39
    WEIGHTED AVERAGE
     SHARES OUTSTANDING —
     BASIC               5,522,188    5,437,805      5,519,265     5,490,077
    WEIGHTED AVERAGE
     SHARES OUTSTANDING —
     DILUTED             5,548,461    5,555,770      5,548,473     5,610,951