The Finish Line Q1 Net Income Jumps 87% on 14% Comps

The Finish Line, Inc. reported that net sales for the first quarter ended May 31, 2003 increased 22% to $207.8 million compared to $170.6 million reported for the same period last year. Comparable store net sales increased 14% for Q1 on top of a 3% increase reported for Q1 LY.

Net income for Q1 was $6.5 million or $.28 per diluted share versus $3.7 million or $.15 per diluted share in Q1 LY, an increase of 87% in diluted earnings per share. Diluted weighted average shares outstanding were 23,678,000 for the thirteen weeks ended May 31, 2003, versus 24,986,000 shares outstanding for the thirteen weeks ended June 1, 2002.

Merchandise inventories were $182.2 million at May 31, 2003 compared to $161.9 million at June 1, 2002. On a per square foot basis merchandise inventories at Q1 increased approximately 6% (six percent) compared to one year ago.

The Company operated 490 stores at May 31, 2003, an increase of 9% (nine percent) over the 451 stores operated one year ago. For the quarter, the Company opened 15 new stores, remodeled 10 existing stores and closed 2 stores. Total retail square footage increased 7% (seven percent) to 2,890,000 at May 31, 2003 versus 2,713,000 at June 1, 2002.

Mr. Cohen stated, “We are pleased to report an 87% increase in diluted earnings per share for the first quarter of Fiscal 2004. We continue to drive significant improvement in our financial performance as gross profit margin improved 70 basis points from Q1 LY while SG&A expense also improved 100 basis points versus Q1 LY. Our strong sales performance in Q1 has continued through the first four weeks of June and we are well positioned and optimistic as we approach the Back-to-School selling season.”

                              The Finish Line, Inc.
                       Consolidated Statements of Income
                                   (Unaudited)
              (In thousands, except per share and store data)

                                                 Thirteen           Thirteen
                                                Weeks Ended       Weeks Ended
                                                   May 31,           June 1,
                                                    2003              2002

     Net Sales                                    $207,805          $170,576
     Cost of Sales (including
      occupancy expenses)                          147,094           121,998
     Gross profit                                   60,711            48,578

     Selling, general, and
      administrative expenses                       50,525            43,089
     Interest income(net)                              200               348
     Income before income taxes                     10,386             5,837
     Income taxes                                    3,843             2,160
     Net income                                     $6,543            $3,677