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SOURCE: Sport-Haley, Inc.
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September 28, 2007 16:25 ET
Sport-Haley, Inc. Reports Fourth Quarter Unaudited Results
DENVER, CO--(Marketwire - September 28, 2007) - Sport-Haley, Inc. (NASDAQ: SPOR) (the "Company")
today announced results of operations for the fourth quarter of its 2007
fiscal year. The Company reported net loss of ($465,000) for the fourth
quarter of its fiscal year ended June 30, 2007, or ($0.19) per share, as
compared with net income of $204,000, or $0.08 per share, in the fourth
quarter of the previous fiscal year.
For the quarter ended June 30, 2007, net sales decreased by 40%, or
$3,109,000, to $4,757,000 from $7,866,000 in the same period in the prior
fiscal year. Gross profit decreased by 21%, or $467,000, to $1,766,000 from
$2,233,000.
The comparative decreases in net sales and gross profit generally relate to
the consolidation of the operations of Reserve Apparel Group LLC ("Reserve
Apparel") with the operations of Sport-Haley, Inc. As previously reported:
Reserve Apparel was formed in November 2005 in order that we may introduce
Top-Flite® branded apparel in Wal-Mart stores; in September 2006,
Sport-Haley, Inc. purchased the minority interest in Reserve Apparel, and
has owned a 100% interest in Reserve Apparel since that time; and, in late
September 2006, Reserve Apparel was notified that Wal-Mart had chosen to
develop its own private label for golf apparel and discontinue selling
Top-Flite® branded apparel. For the quarters ended June 30, 2007 and
2006, respectively, sales of Top-Flite® branded apparel were $0 and
$2,027,000. Gross profit with regard to sales of Top-Flite® branded
apparel was $0 and $96,000 for the quarters ended June 30, 2007 and 2006,
respectively. In fiscal 2007, we received an order for Top-Flite® apparel
from one retailer for a test in 50 of its stores, the first delivery of
which we shipped in September 2007.
For further information regarding our 2007 fiscal year, including the
fourth fiscal quarter thereof, refer to our annual report on Form 10-K for
the fiscal year ended June 30, 2007, which we plan to submit to the
Securities and Exchange Commission in today's business.
Sport-Haley, Inc. designs, purchases, contracts for the manufacture of and
markets women's and men's fashion golf apparel and outerwear under the
SPORT HALEY® and Ben Hogan® labels. The fashion golf apparel
collections, known for their innovative designs, quality fabrics, generous
fits and classic styles, are primarily marketed in the premium and
mid-priced markets, through a network of independent sales representatives
and distributors, to golf professional shops, country clubs, resorts and
exclusive department stores within the United States and by certain
distributors within international markets. Reserve Apparel Group LLC, a
wholly owned subsidiary of Sport-Haley, Inc., designs, purchases, contracts
for the manufacture of, markets and distributes branded golf apparel and
outerwear under the Top-Flite® label to mass retailers and other big-box
type high sales volume retail stores. Ben Hogan® fashion apparel and
Top-Flite® branded apparel are distributed pursuant to a licensing
agreement with Callaway Golf Company, which we consider to be a key
component of our business strategies.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act
of 1995: When used in this release, the words "may," "will," "expect,"
"anticipate," "continue," "estimate," "project," "intend," "believe," and
similar expressions, variations or the negative of these words, and any
statement regarding possible or assumed future results of operations of our
business, the markets for our products, anticipated expenditures,
regulatory developments or competition, or other statements regarding
matters that are not historical facts, are intended to identify
forward-looking statements, although not all forward-looking statements
contain such identifying words. Such forward-looking statements are
subject to various risks and uncertainties, including, but not limited to,
the following: our ability to successfully anticipate fashion trends,
design favorably accepted fashion golf apparel, effectively advertise and
communicate within the marketplace, and penetrate our chosen distribution
channels; competition within golf apparel markets; business conditions and
growth in the fashion golf apparel market and the general economy; our
ability to successfully forecast sales and optimize inventory levels; our
ability to successfully manage risks associated with the trend of an
increasing relative percentage of sales with respect to licensed apparel,
such as the Ben Hogan® apparel collections; establishing markets for our
Top-Flite® apparel which provide the annual sales amount required by
Callaway to satisfy the minimum royalty payments due in accordance with the
license agreement for Top-Flite® apparel; loss of certain third party
suppliers, and/or delays in receiving garments from third party suppliers
caused by various factors, including lost or reduced manufacturing capacity
or significant suppliers, labor shortages, timely performance of third
parties, transportation difficulties, and others; significant delays in
deliveries from third party suppliers; unsatisfactory recourse with regard
to nonconforming goods received from foreign suppliers; political and
international trade relations; changes in international trade quota systems
for apparel; significant reliance upon several individual foreign
suppliers; reliance upon a certain foreign person, responsible for
maintaining relationships with and monitoring the performance of certain of
our significant foreign suppliers; consumer spending on golf apparel;
general global economic and political conditions resulting from threats or
acts of war or terrorism and responses thereto; access to capital;
maintaining satisfactory relationships with commercial banking
institutions; establishing controls with regard to and maintaining the
integrity of technology and information systems; and, reliance upon
executive officers and key employees. Additional information on these and
other factors that could affect our financial results is included in the
discussion below and in our Form 10-K for the year ended June 30, 2007.
There may be other factors not mentioned above, in the discussion below or
included in our Securities and Exchange Commission filings that may cause
actual results to differ materially from any forward-looking statements.
The reader should not place undue reliance on any forward-looking
statements. Neither the Company nor any of its corporate officers or key
employees assumes any obligation to update any forward-looking statements
as a result of new information, future events or developments, except as
required by securities laws.
SPORT-HALEY, INC.
Unaudited Financial Information
Three Months Ended Fiscal Year Ended
June 30, June 30,
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2007 2006 2007 2006
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Statements of Income Data
Net sales $4,757,000 $7,866,000 $18,893,000 $20,962,000
Gross profit 1,766,000 2,233,000 6,688,000 6,912,000
Other operating costs 2,357,000 2,355,000 8,274,000 8,017,000
Income (loss) from
operations (591,000) (122,000) (1,586,000) (1,105,000)
Net income (loss) (465,000) 204,000 (1,301,000) (415,000)
Basic earnings (loss)
per common share ($0.19) $ 0.08 $ (0.50)$ (0.15)
Basic average weighted
shares outstanding 2,284,000 2,770,000 2,580,000 2,749,000
June 30,
-------------------------
2007 2006
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Balance Sheets Data
Current assets $13,547,000 $17,411,000
Total assets 13,949,000 18,027,000
Current liabilities 2,389,000 2,956,000
Long-term liabilities – 34,000
Contingent liabilities 178,000 –
Stockholders' equity 11,382,000 15,015,000