Sportsman’s Guide Again Points to Internet Sales for Profit Gains

The Sportsman's Guide, Inc. reported that sales for the first quarter were $44.6 million compared to the $43.7 million reported for the same period one year ago. The SGDE reported net earnings of $1.2 million, or 22 cents per fully diluted share, for the quarter, a 22% increase when compared to $957,000, or 19 cents per fully diluted share, reported for the three months ended March 31, 2003.

The increase in net earnings and earnings per share from last year's first quarter was due primarily to higher Internet-related sales and lower levels of selling, general and administrative expenses. Internet-related sales for the first quarter of 2004 were just over 40% of total catalog and Internet sales, setting an all time record. Internet-related sales as a percentage of total catalog and Internet sales were approximately 34% for the first quarter of 2003.

Gregory R. Binkley, President and Chief Executive Officer of the Company, stated, “Once again our ongoing strategy of moving more of our business to the Internet has resulted in better than expected earnings growth and profitability.”

Total catalog circulation for the first quarter was 11.0 million catalogs, compared to 11.3 million during the first quarter of 2003. The Company mailed nine catalog editions, consisting of three main catalogs, three Buyer's Club Advantage(TM) catalogs and three specialty catalogs during the quarter ended March 31, 2004, compared to nine catalog editions for the same quarter in 2003.

“The increase in Internet-related sales is the result of enhancements that we continue to make to our websites and the improvements that we continue to make to our marketing and merchandising programs,” Binkley concluded.

                       The Sportsman's Guide, Inc.
                   Consolidated Statements of Earnings
                               (Unaudited)

                          For the quarters ended
                         March 31, 2004 and 2003

                  (In thousands, except per share data)

                                            For the quarters ended March 31,
                                                     2004           2003
  Sales                                            $44,594        $43,749
  Cost of sales                                     30,466         29,552
    Gross profit                                    14,128         14,197
  Selling, general and administrative expenses      12,346         12,730
    Earnings from operations                         1,782          1,467
  Miscellaneous income, net                             42             29
    Earnings before income taxes                     1,824          1,496
  Income tax expense                                   657            539
    Net earnings                                    $1,167          $ 957

  Net earnings per share:
    Basic                                             $.25           $.20
    Diluted                                           $.22           $.19