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Winmark Corporation Announces Year End Results

By: Winmark Corporation |  0 Shares     79 Reads

MINNEAPOLIS - February 25, 2015 - (BUSINESS WIRE) - Winmark Corporation (Nasdaq: WINA) announced today net income for the year ended December 27, 2014 of $20,066,500 or $3.85 per share diluted, compared to net income of $18,231,600 or $3.48 per share diluted, in 2013. The fourth quarter 2014 net income was $5,610,800 or $1.09 per share diluted, compared to net income of $4,585,800 or $.87 per share diluted, for the same period last year. Revenues for the year ended December 27, 2014 were $61,178,700, up from $55,731,200 in 2013.

John L. Morgan, Chairman and Chief Executive Officer, commented, "We ended the year with a solid fourth quarter that was highlighted by a growing and profitable leasing portfolio, as well as steady growth in our franchising business. We opened 94 stores in 2014 and signed an additional 90 agreements for future store openings across all of our brands. Our newest resale concept, Style Encore, currently has 27 open stores and is being well received by both consumers and franchisees."

Winmark Corporation creates, supports and finances business. At December 27, 2014, there were 1,092 franchises in operation under the brands Plato's Closet®, Once Upon A Child®, Play It Again Sports®, Music Go Round® and Style Encore®. An additional 105 retail franchises have been awarded but are not open. In addition, at December 27, 2014, the Company had a lease portfolio equal to $44.0 million.

This press release contains forward-looking statements within the meaning of the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), relating to future events or the future financial performance of the Company including statements with respect to our ability to finance the growth of our leasing and franchising businesses for the foreseeable future. Such forward-looking statements are only predictions or statements of intention subject to risks and uncertainties and actual events or results could differ materially from those anticipated. Because actual result may differ, shareholders and prospective investors are cautioned not to place undue reliance on such forward-looking statements.

WINMARK CORPORATION
CONDENSED BALANCE SHEETS
(unaudited)
		December 27, 2014				December 28, 2013
ASSETS
Current Assets:
Cash and cash equivalents		$	2,089,700			$	10,642,600
Marketable securities			466,800				736,500
Receivables, net			1,328,200				1,205,500
Net investment in leases - current			19,831,600				17,239,900
Income tax receivable			4,163,900				166,500
Inventories			93,500				96,700
Prepaid expenses			467,400				587,300
Total current assets			28,441,100				30,675,000
Net investment in leases – long-term			24,188,900				20,301,400
Property and equipment, net			1,420,300				1,382,200
Other assets			677,500				677,500
		$	54,727,800			$	53,036,100
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Line of credit		$	18,500,000			$	-
Accounts payable			1,955,500				2,441,400
Accrued liabilities			1,759,200				1,233,100
Discounted lease rentals			227,300				424,900
Deferred revenue			2,142,600				2,199,900
Deferred income taxes			4,412,600				4,208,200
Total current liabilities			28,997,200				10,507,500
Long-Term Liabilities:
Discounted lease rentals			25,800				277,400
Deferred revenue			1,347,800				1,180,700
Other liabilities			1,403,200				1,489,000
Deferred income taxes			1,344,300				1,436,800
Total long-term liabilities			4,121,100				4,383,900
Shareholders’ Equity:
Common stock, no par, 10,000,000 shares authorized, 4,998,512 and 5,143,530 shares issued and outstanding			422,400				2,949,500
Accumulated other comprehensive loss			(37,100	)			(4,100	)
Retained earnings			21,224,200				35,199,300
Total shareholders' equity			21,609,500				38,144,700
		$	54,727,800			$	53,036,100

 

WINMARK CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
		Quarter Ended								Fiscal Year Ended
		December 27, 2014				December 28, 2013				December 27, 2014				December 28, 2013
REVENUE:
Royalties		$	10,236,600			$	9,407,100			$	38,972,400			$	36,344,100
Leasing income			4,592,300				3,176,000				16,247,300				14,524,100
Merchandise sales			468,700				506,000				2,728,600				2,327,100
Franchise fees			475,000				315,100				1,989,700				1,459,300
Other			410,200				363,200				1,240,700				1,076,600
Total revenue			16,182,800				13,767,400				61,178,700				55,731,200
COST OF MERCHANDISE SOLD			463,600				471,000				2,619,900				2,205,700
LEASING EXPENSE			396,400				302,500				1,630,600				1,592,000
PROVISION FOR CREDIT LOSSES			36,800				23,000				62,900				(44,700	)
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES			5,931,500				5,469,300				23,806,000				22,198,200
Income from operations			9,354,500				7,501,600				33,059,300				29,780,000
INTEREST EXPENSE			(127,800	)			(33,400	)			(484,500	)			(213,500	)
INTEREST AND OTHER INCOME (EXPENSE)			(14,200	)			28,200				14,000				23,400
Income before income taxes			9,212,500				7,496,400				32,588,800				29,589,900
PROVISION FOR INCOME TAXES			(3,601,700	)			(2,910,600	)			(12,522,300	)			(11,358,300	)
NET INCOME		$	5,610,800			$	4,585,800			$	20,066,500			$	18,231,600
EARNINGS PER SHARE – BASIC		$	1.12			$	.89			$	3.96			$	3.60
EARNINGS PER SHARE – DILUTED		$	1.09			$	.87			$	3.85			$	3.48
WEIGHTED AVERAGE SHARES OUTSTANDING – BASIC			4,997,831				5,137,415				5,069,391				5,068,975
WEIGHTED AVERAGE SHARES OUTSTANDING – DILUTED			5,159,804				5,297,878				5,216,914				5,241,121

SOURCE Winmark Corporation 

Contact:

Brett D. Heffes
Winmark Corporation
763-520-8500

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