8-K

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):  July 12, 2005

Winmark Corporation

(Exact Name of Registrant as Specified in Its Charter)

Minnesota

(State or Other Jurisdiction of Incorporation)

000-22012	41-1622691
(Commission File Number)	(I.R.S. Employer Identification Number)

4200 Dahlberg Drive, Suite 100 Golden Valley, MN 55422-4837

(Address of Principal Executive Offices)  (Zip Code)

(612) 520-8500

(Registrant’s Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 2.Results of Operations and Financial Conditions

Item 2.02

On July 12, 2005, the company announced in a press release its results of operations and financial condition for the second quarter ended June 25, 2005.  A copy of the press release is attached as Exhibit 99.1 of this Current Report on Form 8-K.

Section 7.Regulation FD Disclosure.

Item 7.01

On July 12, 2005, the company announced in a press release its results of operations and financial condition for the second quarter ended June 25, 2005.  A copy of the press release is attached as Exhibit 99.1 of this Current Report on Form 8-K.

Section 9.Financial Statements and Exhibits.

99.1Press Release dated July 12, 2005

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

				WINMARK CORPORATION
Date:  July 12, 2005	By	/s/	Mark T. Hooley
			Mark T. Hooley
			Vice President and General Counsel

3

EXHIBIT INDEX

to

Form 8-K

Winmark Corporation

Exhibit Number	Exhibit Description
99.1	Press Release dated July 12, 2005

4

EX-99.1

Exhibit 99.1

Contact:	John L. Morgan
	763/520-8500

FOR IMMEDIATE RELEASE

WINMARK CORPORATION ANNOUNCES

SECOND QUARTER RESULTS

Minneapolis, MN (July 12, 2005) – Winmark Corporation (Nasdaq; WINA) announced today net income for the quarter ended June 25, 2005 of $542,600, or $.08 per share diluted, compared to net income of $726,300, or $.11 per share diluted, in 2004.  For the six months ended June 25, 2005, net income was $1,242,500, or $.19 per share diluted, compared to net income of $2,086,600, or $.32 per share diluted, for the same period last year.

John L. Morgan, Chairman and Chief Executive Officer, stated, “Earnings for the quarter were lower, compared to last year, due to the continued infrastructure expense of our leasing business.  Our franchise business had a good quarter with a modest increase in the store level performance of our franchisees.”

Winmark Corporation provides financial services and develops franchises for retail stores that buy, sell, trade and consign used and new merchandise.  At June 25, 2005, there were 797 franchise and retail stores in operation under the Company’s brands and an additional 40 franchises awarded but not open.  Of the stores in operation, there were 404 Play It Again Sports®, 210 Once Upon A Child®, 142 Plato’s Closet® and 41 Music Go Round® stores.

WINMARK CORPORATION

CONDENSED BALANCE SHEETS

(Unaudited)

	June 25, 2005		December 25, 2004
ASSETS
Current Assets:
Cash and cash equivalents	$	6,725,800	$	5,983,500
Marketable securities	352,300		1,390,800
Receivables, less allowance for doubtful accounts of $198,200 and $202,000	2,156,600		2,019,800
Inventories	390,600		419,600
Prepaid expenses and other	936,400		654,800
Deferred income taxes	492,600		492,600
Total current assets	11,054,300		10,961,100
Net investment in leasing operations	2,492,200		1,679,700
Long-term investments	11,985,600		10,932,600
Long-term notes receivables, net	25,000		54,400
Property and equipment, net	470,800		293,600
Other assets, net	669,500		654,600
Deferred income taxes	196,400		196,400
	$	26,893,800	$	24,772,400
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	800,900	$	1,063,800
Accrued liabilities	1,600,000		1,299,300
Current deferred revenue	882,900		611,800
Total current liabilities	3,283,800		2,974,900
Long-term deferred revenue	315,300		239,200
Shareholders’ Equity:
Common stock, no par, 10,000,000 shares authorized, 6,110,787 and 5,964,547 shares issued and outstanding	5,700,900		5,186,300
Other comprehensive income	4,900		25,600
Retained earnings	17,588,900		16,346,400
Total shareholders’ equity	23,294,700		21,558,300
	$	26,893,800	$	24,772,400

WINMARK CORPORATION

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)

	Quarter Ended						Six Months Ended
	June 25, 2005			June 26, 2004			June 25, 2005			June 26, 2004
REVENUE:
Royalties	$	4,208,700		$	4,002,800		$	8,723,100		$	8,632,700
Merchandise sales	1,712,000			2,313,500			3,947,600			4,917,500
Franchise fees	225,000			200,100			415,000			392,700
Other	218,100			144,100			422,800			281,300
Total revenue	6,363,800			6,660,500			13,508,500			14,224,200
COST OF MERCHANDISE SOLD	1,400,300			1,956,300			3,320,300			4,108,700
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES	3,987,000			3,446,700			8,032,400			6,765,000
Income from operations	976,500			1,257,500			2,155,800			3,350,500
LOSS FROM EQUITY INVESTMENTS	(89,200		)	(58,100		)	(183,300		)	(82,400		)
GAIN (LOSS) ON SALE OF INVESTMENTS	(14,800		)	(15,400		)	6,500			173,800
INTEREST AND OTHER INCOME	84,900			26,500			144,900			103,000
Income before income taxes	957,400			1,210,500			2,123,900			3,544,900
PROVISION FOR INCOME TAXES	(414,800		)	(484,200		)	(881,400		)	(1,458,300		)
NET INCOME	$	542,600		$	726,300		$	1,242,500		$	2,086,600
EARNINGS PER SHARE – BASIC	$	.09		$	.12		$	.21		$	.36
WEIGHTED AVERAGE SHARES OUTSTANDING – BASIC	6,097,003			5,873,719			6,030,909			5,789,463
EARNINGS PER SHARE – DILUTED	$	.08		$	.11		$	.19		$	.32
WEIGHTED AVERAGE SHARES OUTSTANDING – DILUTED	6,516,921			6,548,548			6,471,219			6,444,967