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Winmark Corporation Announces Year End Results

By: Winmark Corporation |  0 Shares     82 Reads

MINNEAPOLIS - February 24, 2016 - (BUSINESS WIRE) - Winmark Corporation (Nasdaq: WINA) announced today net income for the year ended December 26, 2015 of $21,799,700 or $4.69 per share diluted, compared to net income of $20,066,500 or $3.85 per share diluted, in 2014. The fourth quarter 2015 net income was $5,654,400 or $1.31 per share diluted, compared to net income of $5,610,800 or $1.09 per share diluted, for the same period last year. Revenues for the year ended December 26, 2015 were $69,447,800, up from $61,178,700 in 2014.

“During 2015, we passed an important milestone by achieving more than $1 billion in system-wide sales. We have a talented group of franchisees that are thriving in the current retail environment. Our leasing business continues to add dynamic, growing customers to our portfolio,” stated John L. Morgan, Chairman and Chief Executive Officer.

About Winmark Corporation

Winmark Corporation creates, supports and finances business. At December 26, 2015, there were 1,150 franchises in operation under the brands Plato's Closet®, Once Upon A Child®, Play It Again Sports®, Style Encore® and Music Go Round®. An additional 88 retail franchises have been awarded but are not open. In addition, at December 26, 2015, the Company had a lease portfolio equal to $39.0 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 26, 2015					December 27, 2014
ASSETS
Current Assets:
Cash and cash equivalents			$	1,006,700				$	2,089,700
Marketable securities				227,800					466,800
Receivables, net				1,416,900					1,328,200
Restricted cash				25,000					-
Net investment in leases - current				17,741,500					19,831,600
Income tax receivable				3,290,400					4,163,900
Inventories				45,200					93,500
Prepaid expenses				677,800					467,400
Total current assets				24,431,300					28,441,100
Net investment in leases – long-term				21,246,000					24,188,900
Property and equipment, net				1,121,500					1,420,300
Other assets				607,500					677,500
			$	47,406,300				$	54,727,800
LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)
Current Liabilities:
Line of credit			$	-				$	18,500,000
Notes payable, net				1,990,000					-
Accounts payable				1,643,300					1,955,500
Accrued liabilities				1,875,700					1,759,200
Discounted lease rentals				38,700					227,300
Deferred revenue				1,963,200					2,142,600
Total current liabilities				7,510,900					24,584,600
Long-Term Liabilities:
Line of credit				42,400,000					-
Notes payable, net				21,916,500					-
Discounted lease rentals				-					25,800
Deferred revenue				1,421,600					1,347,800
Other liabilities				1,216,300					1,403,200
Deferred income taxes				3,614,800					5,756,900
Total long-term liabilities				70,569,200					8,533,700
Shareholders’ Equity (Deficit):
Common stock, no par, 10,000,000 shares authorized, 4,124,767 and 4,998,512 shares issued and outstanding				406,500					422,400
Accumulated other comprehensive loss				(32,900	)				(37,100	)
Retained earnings (accumulated deficit)				(31,047,400	)				21,224,200
Total shareholders' equity (deficit)				(30,673,800	)				21,609,500
			$	47,406,300				$	54,727,800

 

WINMARK CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
			Quarter Ended										Fiscal Year Ended
			December 26, 2015					December 27, 2014					December 26, 2015					December 27, 2014
REVENUE:
Royalties			$	10,681,300				$	10,236,600				$	41,908,000				$	38,972,400
Leasing income				4,645,800					4,592,300					21,565,700					16,247,300
Merchandise sales				634,600					468,700					2,816,900					2,728,600
Franchise fees				534,600					475,000					1,788,100					1,989,700
Other				451,200					410,200					1,369,100					1,240,700
Total revenue				16,947,500					16,182,800					69,447,800					61,178,700
COST OF MERCHANDISE SOLD				597,500					463,600					2,653,100					2,619,900
LEASING EXPENSE				818,000					396,400					5,759,300					1,630,600
PROVISION FOR CREDIT LOSSES				(26,300	)				36,800					(149,700	)				62,900
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES				5,867,700					5,931,500					24,094,400					23,806,000
Income from operations				9,690,600					9,354,500					37,090,700					33,059,300
INTEREST EXPENSE				(659,300	)				(127,800	)				(1,802,200	)				(484,500	)
INTEREST AND OTHER INCOME (EXPENSE)				(1,900	)				(14,200	)				(63,700	)				14,000
Income before income taxes				9,029,400					9,212,500					35,224,800					32,588,800
PROVISION FOR INCOME TAXES				(3,375,000	)				(3,601,700	)				(13,425,100	)				(12,522,300	)
NET INCOME			$	5,654,400				$	5,610,800				$	21,799,700				$	20,066,500
EARNINGS PER SHARE – BASIC			$	1.37				$	1.12				$	4.89				$	3.96
EARNINGS PER SHARE – DILUTED			$	1.31				$	1.09				$	4.69				$	3.85
WEIGHTED AVERAGE SHARES OUTSTANDING – BASIC				4,129,266					4,997,831					4,458,927					5,069,391
WEIGHTED AVERAGE SHARES OUTSTANDING – DILUTED				4,331,634					5,159,804					4,651,527					5,216,914

SOURCE Winmark Corporation

Contact:

Brett D. Heffes
Winmark Corporation
763-520-8500

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