DENVER–May 22, 2003–Gart Sports Company (Nasdaq National Market:GRTS) today announced results for its first quarter ended May 3, 2003.
First quarter net income increased to $4.2 million, or $0.34 per fully diluted share, including a net gain of approximately $0.16 associated with non-recurring events and a related tax benefit. Excluding these items, first quarter fully diluted earnings per share was $0.18 compared with $2.6 million, or $0.22 per fully diluted share, in the prior year’s first quarter.
Total sales for the 13 weeks ended May 3, 2003, were $228.4 million compared with $245.0 million in the prior year’s first quarter, a decrease of 6.8%. First quarter comparable store sales decreased 8.8% from last year.
The non-recurring events in the first quarter include a settlement with the Company’s former parent (Thrifty Payless Holdings, Inc.) regarding an IRS examination of its 1992 and 1993 consolidated federal income tax returns and related interest thereon as well as the expected tax benefit related to this settlement. Also included is an expected settlement of the Company’s wage and hour class action lawsuits pending in California.
Doug Morton, Chairman, President and Chief Executive Officer commented, “While our first quarter results were not as strong as we would have liked, we were able to improve margins and minimize the expense impact from the same store sales decline. As we begin the second quarter, we are encouraged by recent trends in both comp store sales and margins. Additionally, our inventory mix is well positioned and we continue to maintain a tight control over expenses.”
Mr. Morton continued, “With our pending merger with the Sports Authority, we remain committed to becoming the nation’s preeminent sporting goods retailer. The underlying fundamentals of our business are sound, our financial position is strong and we are dedicated to executing on a strategy that will result in long-term growth and increased shareholder value.”
Gart Sports and Sports Authority stockholders and other investors are urged to read the joint proxy statement/prospectus and other materials that have been and will continue to be filed by Gart Sports and The Sports Authority with the SEC. These documents contain important information that should be read carefully before any decision is made with respect to the merger. When documents are filed with the SEC, they will be available for free at the SEC’s website at www.sec.gov. Documents are also available for free from the contact persons listed above.Gart Sports Company, headquartered in Denver, Colorado, is the largest full-line sporting goods retailer in the Western United States. The Company was established in 1928 and offers a comprehensive high-quality assortment of brand name sporting apparel and equipment at competitive prices. Gart Sports Company operates 180 stores in 25 states under the Gart Sports(R), Sportmart(R) and Oshman’s(R) names. The Company’s e-tailing websites, located at gartsports.com, sportmart.com and oshmans.com, are operated by GSI Commerce, Inc. under a license and e-commerce agreement. The Company trades on the Nasdaq National Market under the symbol GRTS.