-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QHUTCEkqZKts50knSXs3VTLkL6Or88WHTf2CsULprWIFw6kIbeDtu9vtlLV/zCWT r2ARs77HqJnc+9kHQjYuFg== 0000926236-03-000093.txt : 20030627 0000926236-03-000093.hdr.sgml : 20030627 20030627154337 ACCESSION NUMBER: 0000926236-03-000093 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030627 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030627 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SPORT SUPPLY GROUP INC CENTRAL INDEX KEY: 0000872855 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-CATALOG & MAIL-ORDER HOUSES [5961] IRS NUMBER: 752241783 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-10704 FILM NUMBER: 03761278 BUSINESS ADDRESS: STREET 1: 1901 DIPLOMAT DRIVE CITY: FARMERS BRANCH STATE: TX ZIP: 75234-8914 BUSINESS PHONE: 9724849484 8-K 1 ssg8k062703.txt CURRENT REPORT JUNE 27, 2003 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): June 27, 2003 SPORT SUPPLY GROUP, INC. ------------------------------------------------------ (Exact name of registrant as specified in its charter) Delaware 001-10704 75-2241783 --------------- ----------- ------------- (State or Other (Commission (IRS Employer Jurisdiction of File Number) Identification No.) Incorporation) 1901 Diplomat Drive, Farmers Branch, Texas 75234 --------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (972) 484-9484 ITEM 7: EXHIBITS Exhibit No. Description ----------- ----------- 99.1 Form 12b-25 Notification of Late Filing, filed with the Securities and Exchange Commission on June 27, 2003 (furnished and not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and not deemed incorporated by reference in any filing under the Securities Act of 1934, as amended) ITEM 9: REGULATION FD DISCLOSURE The information in this report is being furnished (i) pursuant to Regulation FD, and (ii) pursuant to Item 12 Results of Operations and Financial Condition (in accordance with SEC interim guidance issued March 28, 2003). In accordance with General Instructions B.2 and B.6 of Form 8-K, the information in this report shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1934, as amended. The furnishing of the information set forth in this report is not intended to, and does not, constitute a determination or admission as to the materiality or completeness of such information. On June 27, 2003, Sport Supply Group, Inc., a Delaware corporation (the "Company"), filed with the Securities and Exchange Commission (the "Commission") a "Notification of Late Filing" on Form 12b-25 (the "Filing") to state why the Company cannot file its Form 10-K, for the fiscal year ended March 28, 2003, with the Commission within the prescribed period. A copy of the Filing is attached hereto as Exhibit 99.1 and incorporated herein by reference. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Date: June 27, 2003 SPORT SUPPLY GROUP, INC. By: /s/ Robert K. Mitchell ----------------------- Robert K. Mitchell Chief Financial Officer Index to Exhibits Exhibit No. Description ----------- ----------- 99.1 Form 12b-25 Notification of Late Filing, filed with the Securities and Exchange Commission on June 27, 2003 (furnished and not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and not deemed incorporated by reference in any filing under the Securities Act of 1934, as amended) EX-99.1 3 exh99-1.txt FORM 12B-25 NOTIFICATION OF LATE FILING EXHIBIT 99.1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Commission File Number 1-10704 FORM 12b-25 NOTIFICATION OF LATE FILING (Check One): [X] Form 10-K [ ] Form 20-F [ ] Form 11-K [ ] Form 10-Q [ ] Form N-SAR [ ] Form N-CSR For Period Ended: March 28, 2003 ----------------------------------------------- [ ] Transition Report on Form 10-K [ ] Transition Report on Form 20-F [ ] Transition Report on Form 11-K [ ] Transition Report on Form 10-Q [ ] Transition Report on Form N-SAR For the Transition Period Ended: ____________________________ ____________________________________________________________________________ Read Attached Instruction Sheet Before Preparing Form. Please Print or Type. Nothing in this form shall be construed to imply that the Commission has verified any information contained herein. ____________________________________________________________________________ If the notification relates to a portion of the filing checked above, identify the Items(s) to which the notification relates: ___________________ ____________________________________________________________________________ ____________________________________________________________________________ Part I--REGISTRANT INFORMATION ____________________________________________________________________________ Full Name of Registrant: SPORT SUPPLY GROUP, INC. Former Name if Applicable: Not Applicable 1901 Diplomat Drive --------------------------------------------------------- Address of Principal Executive Office (Street and Number) Farmers Branch, Texas 75234 --------------------------------------------------------- City, State and Zip Code ____________________________________________________________________________ Part II--RULES 12b-25(b) and (c) ____________________________________________________________________________ If the subject report could not be filed without unreasonable effort or expense and the registrant seeks relief pursuant to Rule 12b-25(b), the following should be completed. (Check box if appropriate) (a) The reasons described in reasonable detail in Part III of this form could not be eliminated without unreasonable effort or expense; [X] (b) The subject annual report, semi-annual report, transition report on Form 10-K, Form 20-F, Form 11-K, Form N-SAR or Form N-CSR, or portion thereof, will be filed on or before the fifteenth calendar day following the prescribed due date; or the subject quarterly report or transition report on Form 10-Q, or portion thereof, will be filed on or before the fifth calendar day following the prescribed due date; and (c) The accountant's statement or other exhibit required by Rule 12b-25(c) has been attached if applicable. ____________________________________________________________________________ Part III--NARRATIVE ____________________________________________________________________________ State below in reasonable detail why Form 10-K, Form 20-F, Form 11-K, Form 10-Q, Form N-SAR or Form N- CSR, or the transition report or portion thereof, could not be filed within the prescribed period. In June 2001, the Financial Accounting Standards Board issued Statement No. 142, "Goodwill and Other Intangible Assets" (SFAS 142). SFAS 142 requires that goodwill not be amortized but instead be tested for impairment at least annually by reporting unit. Goodwill is required to be tested for impairment in a transitional test upon adoption and then at least annually by reporting unit. Goodwill impairment testing must also be performed more frequently if events or other changes in circumstances indicate that goodwill might be impaired. We adopted SFAS 142 effective March 30, 2002. As a result, we ceased recording amortization of goodwill on March 30, 2002. Under the provisions of SFAS 142, a two step process is used to evaluate goodwill impairment. Under step one of the evaluation process, the carrying value of a reporting unit is compared to its fair value to determine if a potential goodwill impairment exists. Under step two of the evaluation process, if a potential goodwill impairment is identified during step one, then the amount of goodwill impairment, if any, is measured using a hypothetical purchase price allocation approach. We completed step one of SFAS 142. The results of our step one analysis indicate that we have a potential impairment of goodwill in each of our two reporting units. Consequently, we retained an independent third party to determine the value of our goodwill through an independent appraisal. The appraisal was not complete as of June 26, 2003, the date our Report on Form 10-K was due to be filed with the Securities and Exchange Commission. Consequently, we were unable to file our Report on Form 10-K without unreasonable effort or expense. As of March 29, 2002 and December 27, 2002, we had $7.4 million of goodwill recorded on our consolidated balance sheet. Under SFAS 142, any goodwill impairment recorded on or before March 28, 2003, is reported as a cumulative effect of a change in accounting principle on the consolidated statement of operations, and will have no cash impact. ____________________________________________________________________________ Part IV--OTHER INFORMATION ____________________________________________________________________________ (1) Name and telephone number of person to contact in regard to this notification Robert K. Mitchell (972) 406-3484 ----------------------------------------------------------------------- (Name) (Area Code) (Telephone Number) (2) Have all other periodic reports required under Section 13 or 15(d) of the Securities Exchange Act of 1934 or Section 30 of the Investment Company Act of 1940 during the preceding 12 months or for such shorter period that the registrant was required to file such report(s) been filed? If the answer is no, identify report(s). [X] Yes [ ] No (3) Is it anticipated that any significant change in results of operations from the corresponding period for the last fiscal year will be reflected by the earnings statements to be included in the subject report or portion thereof? [X] Yes [ ] No If so: attach an explanation of the anticipated change, both narratively and quantitatively, and, if appropriate, state the reasons why a reasonable estimate of the results cannot be made. SPORT SUPPLY GROUP, INC. -------------------------------------------- (Name of Registrant as specified in charter) Has caused this notification to be signed on its behalf by the undersigned thereunto duly authorized. Date: June 27, 2003 By: /s/ Robert K. Mitchell ----------------------- Robert K. Mitchell Chief Financial Officer INSTRUCTION: The form may be signed by an executive officer of the registrant or by any other duly authorized representative. The name and title of the person signing the form shall be typed or printed beneath the signature. If the statement is signed on behalf of the registrant by an authorized representative (other than an executive officer), evidence of the representative's authority to sign on behalf of the registrant shall be filed with the form. ATTACHMENT ---------- PART IV, QUESTION 3 ------------------- We anticipate that we will significantly reduce our Net Loss Before Income Taxes and Cumulative Effect of Accounting Change for the fiscal year ended March 28, 2003 as compared to the fiscal year ended March 29, 2002. The goodwill valuation described in Part III above is not yet complete and, accordingly, we are unable to estimate the amount, if any, of (i) our income tax benefit or provision and (ii) goodwill impairment. Any goodwill impairment will be reported as a cumulative effect of a change in accounting principle on the consolidated statement of operations and will not have any cash impact. If reserves associated with our deferred tax assets are released as a result of the goodwill valuation then such reduction in reserves will reduce our tax expense and therefore decrease our net loss. Conversely, if additional reserves associated with our deferred tax assets are increased as a result of the goodwill valuation, then such increase in reserves will increase our tax expense and will increase our net loss. The following table summarizes certain financial information relating to our results of operations for the fiscal years ended March 28, 2003 and March 29, 2002. The financial information set forth for the fiscal year ended March 28, 2003 is preliminary and unaudited and is our best estimate as of the date of this Report. Final results may vary depending upon the goodwill valuation. 2003 2002 ------------ ------------ Net Revenues $102,617,413 $103,601,428 Gross Profit $30,029,166 $29,495,185 SG&A $30,511,651 $31,928,924 Internet expenses $460,845 $355,766 Interest expense 629,026 985,509 Other income, net 11,398 192,586 Net loss before income taxes and cumulative effect of accounting change $(1,560,958) $(3,582,428) Net Revenues. Net revenues decreased approximately $984,000 (1.0%) for the fiscal year ended March 28, 2003 as compared to the fiscal year ended March 29, 2002. The decrease in net revenues was primarily the result of revenue losses in our Team Dealer operations and decreases in school spending for athletic programs. Gross Profit. Gross profit increased approximately $534,000 (1.8%) for the fiscal year ended March 28, 2003 as compared to the same period in fiscal 2002. As a percentage of net revenues, gross profit increased to 29.3% for the fiscal year ended March 28, 2003 as compared to 28.5% for the fiscal year ended March 29, 2002. The increase in gross profit is attributable to the consolidation of several of our plants, exiting certain unprofitable product lines and improved product sourcing. Selling, General and Administrative Expenses. Selling, general and administrative expenses decreased approximately $1.4 million (4.4%) for the fiscal year ended March 28, 2003 as compared to the same period in fiscal 2002. As a percentage of net revenues, selling, general and administrative expenses decreased to 29.7% from 30.8% for the fiscal year ended March 28, 2003 as compared to the fiscal year ended March 29, 2002. The decrease in selling, general and administrative expenses for the fiscal year ended March 28, 2003 as compared to the fiscal year ended March 29, 2002 is primarily a result of the following: (i.) A decrease in payroll and related expense of approximately $1.1 million; primarily a result of reduced headcount. (ii.) A decrease in depreciation and amortization expense of approximately $366,000; primarily a result of assets reaching their full depreciation levels and the discontinuation of goodwill amortization. (iii.) A decrease in auditing and legal expenses of approximately $185,000; primarily a result of lower audit fees due to our change in fiscal year from September to March which resulted in more audit work in the prior year. The decrease in selling, general and administrative expenses was partially offset by an increase in promotional expenses of approximately $174,000, primarily as a result of increased direct marketing expenses. Internet Expenses. Internet related expenses increased approximately $105,000 (29.5%) for the fiscal year ended March 28, 2003 as compared to the fiscal year ended March 29, 2002. These expenses are related to the continued support and enhancement of our websites and web development to post electronic catalogs on our websites. Interest Expense. Interest expense decreased approximately $356,000 (36.2%) for the fiscal year ended March 28, 2003 as compared to the fiscal year ended March 29, 2002. This decrease is due to lower average borrowings and lower interest rates. Other Income, Net. Other income decreased approximately $181,000 for the fiscal year ended March 28, 2003 as compared to the fiscal year ended March 29, 2002. This decrease is due primarily to the casualty gain on insurance proceeds received in the prior year for assets lost in a flood that occurred in our corporate facility. These proceeds were used to purchase replacement assets. Net Loss Before Income Taxes and Cumulative Effect of Accounting Change. Net Loss Before Income Taxes and Cumulative Effect of Accounting Change decreased approximately $2,021,000 for the fiscal year ended March 28, 2003 as compared to the fiscal year ended March 29, 2002 for the various reasons set forth above. -----END PRIVACY-ENHANCED MESSAGE-----