Sport Supply Group, Inc. reported its fourth consecutive quarter of significantly improved operating results, with revenue for the fiscal fourth quarter ended March 31 increasing 12.8% to $27.4 million from $24.2 million in the year-ago period. Gross margins improved 410 basis points to 29.2% of sales versus 25.1% in Q4 last year. SSG reported $1.5 million in net income versus a net loss of $2.1 million in the the year-ago quarter.
For the year, revenue increased 7.3% to $90.0 million from $83.9 million. The company posted net income of $2.1 million versus a net loss of $1.7 million.
The Company's balance sheet as of March 31, 2005 also reflects significant improvements as compared to March 26, 2004, including a $4 million reduction in long term debt and a $2 million increase in Stockholders' Equity.
Geoffrey P. Jurick, Chairman of the Board and Chief Executive Officer, commented, “We achieved significant improvements from the prior year in virtually all measures of financial performance for the quarter and year-ended March 31, 2005. Our fiscal 2005 results reflect organic revenue growth, margin improvement, operating cost reductions and a significant improvement in operating income as compared to a net loss last year. Operating income for the year-ended March 31, 2005 was $2.2 million, which translates into a $6.1 million operating income improvement from our last fiscal year. Our $2.1 million net income in the current year represents a $3.8 million improvement from the $1.7 million net loss last year. It is important to note that the March 26, 2004 net loss included a $2.7 million gain that was recorded as a result of the sale of the Company's subsidiary Athletic Training Equipment Company. Excluding this one-time gain, net income for the year ended March 31, 2005 improved by $6.5 million. No income tax provision is reflected in our income statement because we have net operating loss carryforwards of approximately $20 million.
“We continued to strengthen our balance sheet by managing cash flow, accounts receivable and inventory to reduce total debt by approximately $4 million since March 2004. We are very pleased that our turnaround efforts continued to produce such substantial improvements in all targeted areas.”
SPORT SUPPLY GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except earnings per share)
Three Months Ended Twelve Months Ended
March March
2005 2004 2005 2004
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Net revenues $27,252 $24,162 $89,988 $83,867
Cost of sales 19,428 18,107 64,027 61,725
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Gross profit 7,824 6,055 25,961 22,142
Selling, general and
administrative expenses 5,892 7,246 22,015 24,046
Depreciation and
amortization 387 465 1,721 1,986
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Operating profit (loss) 1,545 (1,656) 2,225 (3,890)
Interest & other expense 46 51 216 459
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Income (loss) before
taxes 1,499 (1,707) 2,009 (4,349)
Provision for income
taxes 0 0 0 0
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Net income (loss)
before discontinued
operations 1,499 (1,707) 2,009 (4,349)
Discontinued operations
income (loss) 50 (387) 50 2,661
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Net income (loss) $1,549 $(2,094) $2,059 $(1,688)
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Earnings per share:
Basic $0.174 $(0.235) $0.231 $(0.189)
Diluted $0.169 $(0.235) $0.227 $(0.189)
