WINMARK CORPORATION ANNOUNCES YEAR END RESULTS
Minneapolis, MN (February 16, 2006) -- Winmark Corporation (Nasdaq: WINA) announced today net income for the year ended December 31, 2005 of $2,100,000 or $.33 per share diluted, compared to net income of $4,082,000 or $.63 per share, in 2004. The fourth quarter 2005 net loss was ($68,600), or ($.01) per share diluted, compared to net income of $980,100, or $.15 per share diluted, for the same period last year. Revenues for the year were $26,593,000, down from $27,201,900 in 2004.
“2005 was a year where we continued to improve our franchising business and build the leasing sales and operations infrastructure to support future growth. Our fourth quarter results were negatively impacted by two items: an impairment charge related to Winmark’s investment in eFrame, LLC of $937,610, or $0.08 per share and a stock option compensation charge of approximately $420,000 or $0.04 per share.” stated John Morgan, Chairman and Chief Executive Officer. “2006 will be the first full year that both our franchise and leasing businesses will be firmly in place.”
Winmark Corporation provides financial services and develops franchises for retail stores that buy, sell, trade and consign used and new merchandise. At December 31, 2005, the Company had 804 stores in operation and an additional 40 franchises awarded but not open. Of the stores in operation, there were 397 Play It Again Sports®, 206 Once Upon A Child®, 159 Plato’s Closet® and 42 Music Go Round® stores. In addition, at December 31, 2005, the Company had an equipment leasing portfolio equal to $7.0 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 growing our leasing and franchising businesses. 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.