Winmark: Minneapolis, Mn (April 17, 2019)

The following excerpt is from the company's SEC filing.

 Winmark Corporation (Nasdaq: WINA) announced today net income for the quarter ended March 30, 2019 of $7,272,200 (or $1.73 per share diluted) compared to net income of $6,960,400 (or $1.69 per share diluted) in 2018.

Brett D. Heffes, Chief Executive Officer, commented, “Our first quarter results were positively impacted by the performance of our franchisees, offset by lower activity in our leasing business.”

Winmark Corporation creates, supports and finances business. At March 30, 2019, there were 1,241 franchises in operation under the brands Plato’s Closet®, Once Upon A Child®, Play It Again Sport s®, Style Encore® and Music Go Round®.  An additional 46 retail franchises have been awarded but are not open.  In addition, at March 30, 2019, the Company had a lease portfolio of  $35.1 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.  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 29, 2018

ASSETS

Current Assets:

 Cash and cash equivalents

1,066,800

2,496,000

 Restricted cash

65,000

80,000

 Receivables, net

1,455,500

1,553,100

 Net investment in leases - current

17,321,500

18,547,500

 Income tax receivable

565,500

 Inventories

113,800

107,600

 Prepaid expenses

954,100

901,600

     Total current assets

20,976,700

24,251,300

 Net investment in leases – long-term

17,786,000

20,455,500

 Property and equipment, net

908,800

866,200

 Operating lease right of use asset

6,056,100

 Goodwill

607,500

607,500

 Other assets

496,700

482,600

46,831,800

46,663,100

LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)

Current Liabilities:

 Notes payable, net

3,236,100

3,236,100

 Accounts payable

1,717,800

1,351,800

 Income tax payable

1,664,700

 Accrued liabilities

2,669,100

3,128,600

 Discounted lease rentals

3,070,700

3,021,900

 Deferred revenue

1,750,700

1,744,900

     Total current liabilities

14,109,100

12,483,300

Long-Term Liabilities:

 Line of credit

11,500,000

24,795,900

25,604,900

1,937,300

2,723,500

8,247,900

8,432,400

 Operating lease liabilities

5,823,000

 Other liabilities

764,800

1,079,200

 Deferred income taxes

1,148,900

1,148,300

     Total long-term liabilities

54,217,800

38,988,300

Shareholders’ Equity (Deficit):

Common stock, no par, 10,000,000 shares authorized,

3,759,186 and 3,907,686 shares issued and outstanding

4,425,600

 Retained earnings (accumulated deficit)

(21,495,100)

(9,234,100)

     Total shareholders’ equity (deficit)

(4,808,500)

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)

Three Months Ended

March 31, 2018

REVENUE:

 Royalties

11,761,400

11,049,000

 Leasing income

5,155,300

5,528,800

 Merchandise sales

611,000

776,900

 Franchise fees

391,800

400,900

411,700

405,400

              Total revenue

18,331,200

18,161,000

COST OF MERCHANDISE SOLD

571,500

742,500

LEASING EXPENSE

698,700

554,900

PROVISION FOR CREDIT LOSSES

10,100

95,000

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

6,984,400

6,694,400

              Income from operations

10,066,500

10,074,200

INTEREST EXPENSE

(442,200)

(743,800)

INTEREST AND OTHER EXPENSE

(300)

(1,000)

              Income before income taxes

9,624,000

9,329,400

PROVISION FOR INCOME TAXES

(2,351,800)

(2,369,000)

NET INCOME

7,272,200

6,960,400

EARNINGS PER SHARE – BASIC

EARNINGS PER SHARE – DILUTED

WEIGHTED AVERAGE SHARES OUTSTANDING – BASIC

3,906,895

3,847,312

WEIGHTED AVERAGE SHARES OUTSTANDING – DILUTED

4,198,454

4,124,573

The above information was disclosed in a filing to the SEC. To see the filing, click here.

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