SOURCE: The Sportsman's Guide

March 07, 2006 17:00 ET

The Sportsman's Guide Releases Record Fourth Quarter and Record 2005 Year-End Results; Final Consolidated Net Sales and EPS at High End of Guidance

Company Reports Consolidated Net Sales Up Nearly 23% and Net Income Up 51% for the Year

SOUTH ST. PAUL, MN -- (MARKET WIRE) -- March 7, 2006 -- The Sportsman's Guide, Inc. (NASDAQ: SGDE) today reported record results of operations for the quarter and year ended December 31, 2005, with consolidated net sales and earnings per share that are at the high end of the Company's most recent guidance.

After adjusting out the additional week in the fourth quarter of 2004, the consolidated net sales for the fourth quarter of 2005 increased by nearly 10% to $95.2 million. Company officials noted that the fourth quarter of 2004 included 14 weeks of activity, compared with 13 weeks this year. The additional week resulted in approximately $4 million of incremental net sales with minimal effect on net earnings in the quarter or for the year of 2004.

The Company reported net earnings of $4.5 million, or $0.53 per fully diluted share for the fourth quarter of 2005, compared with $3.7 million, or $0.46 per share, reported for the three months ended December 31, 2004. Earnings per share for 2004 reflect the 3-for-2 stock split, distributed April 15, 2005.

For the twelve months ended December 31, 2005, consolidated net sales were $285.1 million, a 23% increase over the $232.5 million reported for 2004. The increase is nearly 25% when the additional week in 2004 is not considered. The Company recorded net earnings of $11.5 million, or $1.38 per fully diluted share, for the year, an increase of 51% when compared with net earnings of $7.6 million, or $0.95 per share, for the twelve months ended December 31, 2004.

Gregory R. Binkley, President and Chief Executive Officer of the Company, stated, "These record results clearly validate that our formula continues to work and yield exceptional results. In 2005 we saw consolidated net sales and net earnings grow 23% and 51% respectively over 2004. These increases were due to the addition of and the strong performance of The Golf Warehouse ("TGW"), and the continuing growth of The Sportsman's Guide ("TSG"). We also continued to generate high levels of Internet-related sales, as they once again totaled nearly 60% of total catalog and Internet sales for the year."

Binkley also noted that the Company ended the year with just over $14 million in cash and cash equivalents on the balance sheet, no bank debt and no remaining debt associated with the acquisition of TGW.

The Sportsman's Guide, Inc. will hold a conference call tomorrow at 10:30 am CT, Wednesday, March 8, 2006, to discuss the quarter and year-end results. Gregory R. Binkley, President and Chief Executive Officer of the Company, and Charles B. Lingen, Executive Vice President and Chief Financial Officer, will be present on the call. Participants may access the call by dialing 1-800-616-9004 five to 10 minutes prior to the scheduled start time and asking for The Sportsman's Guide conference call. The call may also be accessed via the Internet at www.SportsmansGuideIR.com.

The Sportsman's Guide is an Internet and catalog retailer offering value-priced outdoor gear and general merchandise, with a special emphasis on outdoor clothing, outdoor equipment, golf apparel and equipment and footwear. The company sells through both Internet websites and catalogs. The Company's websites include www.sportsmansguide.com, www.tgw.com, www.bargainoutfitters.com, www.baseballsavings.com and www.softballsavings.com.

This release contains forward-looking statements which are subject to change based on various important factors, including but not limited to general economic conditions, a changing market environment for the Company's products and the market acceptance of the Company's catalogs.

            The Sportsman's Guide, Inc. and Subsidiaries
                   Consolidated Balance Sheets
                    (In thousands of dollars)

                                             December 31,   December 31,
                                                2005           2004
                                              --------       --------
            ASSETS
CURRENT ASSETS
     Cash and cash equivalents                $ 14,050       $  8,616
     Accounts receivable – net                   4,437          3,955
     Inventory                                  34,238         29,148
     Promotional material                        4,462          3,578
     Prepaid expenses and other                  3,761          3,123
     Deferred income taxes                       2,027          1,767
                                              --------       --------
        Total current assets                    62,975         50,187
PROPERTY AND EQUIPMENT, NET                      2,325          2,693
OTHER ASSETS
     Goodwill                                   17,205         17,176
     Trade and domain name                      10,200         10,200
     Other                                       1,185            658
                                              --------       --------
        Total other assets                      28,950         28,034
                                              --------       --------
        Total assets                          $ 93,890       $ 80,914
                                              ========       ========

      LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
     Accounts payable                         $ 26,687       $ 23,832
     Accrued expenses and other current
      liabilities                               24,465         21,822
                                              --------       --------
        Total current liabilities               51,152         45,654
LONG-TERM LIABILITIES                              769          5,388
                                              --------       --------
        Total liabilities                       51,921         51,042
SHAREHOLDERS' EQUITY                            41,969         29,872
                                              --------       --------
        Total liabilities and shareholders'
         equity                               $ 93,890       $ 80,914
                                              ========       ========
             The Sportsman's Guide, Inc. and Subsidiaries
                 Consolidated Statements of Earnings
                 For The Three Months And Years Ended
                      December 31, 2005 and 2004
                 (In thousands, except per share data)

                               Three months ended         Years ended
                                   December 31,           December 31,
                              --------------------   --------------------
                                 2005       2004        2005       2004
                              ---------  ---------   ---------  ---------
Sales                         $  95,215  $  91,062   $ 285,120  $ 232,465
Cost of sales                    63,329     60,752     194,267    158,081
                              ---------  ---------   ---------  ---------
     Gross profit                31,886     30,310      90,853     74,384
Selling, general and
 administrative expenses         24,858     24,283      72,789     62,122
                              ---------  ---------   ---------  ---------
     Earnings from operations     7,028      6,027      18,064     12,262
Interest expense                    (91)      (193)       (304)      (361)
Miscellaneous income
 (expense), net                     144        (82)        326         (2)
                              ---------  ---------   ---------  ---------
     Earnings before income
      taxes                       7,081      5,752      18,086     11,899
Income tax expense                2,581      2,084       6,633      4,306
                              ---------  ---------   ---------  ---------
     Net earnings             $   4,500  $   3,668   $  11,453  $   7,593
                              =========  =========   =========  =========

Net earnings per share:
     Basic                    $     .61  $     .52   $    1.58  $    1.07
                              =========  =========   =========  =========
     Diluted                  $     .53  $     .46   $    1.38  $     .95
                              =========  =========   =========  =========

Weighted average common and
 common equivalent shares
 outstanding:
     Basic                        7,371      7,075       7,228      7,078
                              =========  =========   =========  =========
     Diluted                      8,463      8,000       8,290      7,985
                              =========  =========   =========  =========

Contact Information

  • CONTACT:
    William P. Bartkowski
    MeritViewPartners
    612.605.8616

    THE SPORTSMAN'S GUIDE
    411 Farwell Avenue
    South Saint Paul, Minn. 55075