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The Sports Authority 3Q gets thumbs-up from analysts
With its third-quarter financial results beating analysts’ estimates, shares of The Sports Authority (NYSE: TSA) leapt 15 percent. The retailer’s shares rose $3.73, closing at $29.48, making it one of the top percentage gainers on the New York Stock Exchange on Nov. 24.
Analysts said the company’s turnaround bid appeared solidly in place and that the third-quarter results showed new initiatives such as store remodels, new footwear walls and new exercise equipment seemed to be working. The company also said its fitness business had improved and that it was encouraged by initial results from an expanded winter sports offering heading into the holiday season.
The results of both the third quarter of 2004 and 2003 represent the performance of the merged Gart Sports and The Sports Authority companies. Net loss for the third quarter was $2.2 million, or $0.09 per diluted share, including the effect of after-tax merger integration costs of $2.9 million, or $0.11 per diluted share compared with a net loss of $0.31 per diluted share in the prior year’s third quarter, which included the effect of after-tax merger integration costs of $12.0 million, or $0.49 per diluted share. Without the merger integration costs, net income for the third quarter was $0.7 million, or $0.03 per diluted share, compared with net income of $4.4 million, or $0.17 per diluted share, in the prior year’s third quarter.
Total sales for the third quarter were $545.0 million compared with $552.5 million in the prior year’s third quarter. Third-quarter same-store sales were down 1.9 percent from last year’s results.
As of Oct. 30, the company opened seven stores and closed three stores during the quarter for a total of 390 stores.
Amer Group calls shareholders to special meeting
Amer Group is summoning its shareholders to an “Extraordinary General Meeting” on Dec. 13 in Helsinki, Finland, to deal with a variety of matters, including a bonus issue and article amendments. Amer’s board proposes that its share capital be increased by means of a bonus issue by Euro 190,452,960 (USD $252,921,531) from Euro 95,226,480 (USD $126,460,765) to Euro 285,679,440 (USD $379,382,296). Under the new terms of the bonus issue, each share will entitle its holder to receive two new shares, without payment. 47,613,240 new shares will be issued, each with accounted counter value of Euro 4 (USD $5.31). A total amount equaling the increase of the share capital in the shareholders’ equity of Euro 190,452,960 (USD $252,921,531) will be transferred from its premium fund. Amer’s board is also proposing the amendment to two articles, one about the minimum and maximum share capital for the company and the other about changing monetary references to Euro rather than Finnish markka and its bank to European Central Bank from Bank of Finland. The board’s proposals will be available for inspection on Dec. 3. (Conversion of Euros into U.S. dollars is for information only, is not necessarily relative to earnings, and is based on the currency rate as of Nov. 25.)
Bally appoints new general counsel
Starting Jan. 1, 2005, Marc Bassewitz will assume the senior vice president and general counsel positions for Bally Total Fitness (NYSE:BFT), succeeding Cary Gaan who will transition to the newly created role of senior vice president, special counsel to the president. For the past several years, Bassewitz has served as lead outside counsel for Bally in his position at Latham & Watkins LLP. Bassewitz has handled debt and equity financing transactions, managed acquisition and disposition transactions, and engaged in numerous M&A, recapitalization and restructuring transactions on behalf of companies and financial and strategic buyers. In his new capacity at Bally, he will oversee all corporate legal responsibilities, including regulatory compliance and corporate governance.
Everlast expands license agreements with Hong Kong companies
Everlast Worldwide Inc. (Nasdaq: EVST) is expanding its relationships with two Hong Kong-based licensees: Muse Marketing Ltd. and Stelux Watch Ltd. Muse started with Everlast bags and footwear in 2001 and will introduce apparel in fall 2005 in Hong Kong. Stelux, which launched Everlast-branded watches in China, Hong Kong, Taiwan, Singapore, Malaysia, Thailand and Japan, will expand its territory to include Europe, shipping by mid 2005. George Horowitz, Everlast’s CEO, said the company will continue to leverage its strength and consumer recognition of the Everlast brand through the signing of additional licensing agreements, adding that there are a number of new product categories as well as international growth opportunities for the company.
Reebok completes securities exchange
Reebok International Ltd. (NYSE:RBK) said it completed its offer to exchange new 2 percent convertible debentures due 2024 (the “New Securities”) for up to $350 million of the 2 percent convertible debentures due 2024 that were issued by Reebok on April 30, 2004 (the “Old Securities”). The exchange offer expired Nov. 23. As of the expiration of the exchange offer, approximately $296.8 million aggregate principal amount of Old Securities, representing approximately 84.8 percent of the total principal amount of Old Securities outstanding, had been tendered in exchange for an equal principal amount of New Securities. All Old Securities that were properly tendered have been accepted for exchange. Following the consummation of the exchange offer, approximately $53.2 million aggregate principal amount of Old Securities will remain outstanding. The information agent for the exchange offer is MacKenzie Partners, Inc., and the dealer manager is Credit Suisse First Boston LLC.
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