The Sportsman’s Guide buys The Golf Warehouse
The Sportsman’s Guide Inc., a catalog and online retailer of gear and apparel for camping, fishing and other outdoor activities, is expanding its market reach with a $3 million cash acquisition of The Golf Warehouse LLC, Sportsman’s Guide said today.
“It adds a spring and summer business to our business, helping to smooth out some of the seasonality that we have traditionally seen,” says CEO Gregory R. Binkley. He adds that Wichita, KS-based The Golf Warehouse, which operates a catalog and TGW.com, has shown remarkable growth in online sales and that the combined companies will realize significant synergies and cost savings. “Sales of golf equipment and golf apparel represent a $5-$6 billion annual market and statistics tell us golfers use the Internet more frequently than many other consumers grouped by leisure activity. We expect to see TGW`s market share and consumer awareness increase going forward," he says.
The Golf Warehouse will continue to be run by its management team headed by CEO and founder Mark Marney. The golf retailer produces five catalogs a year, with about 3.5 million distributed copies, Marney says. Its web site, TGW.com, offers more than 18,000 brand-name items, including equipment and apparel from leading brands like Titleist, Taylor Made, Nike, PING and Callaway.
The Golf Warehouse, No. 103 in the Internet Retailer Top 300 Guide to online retailers, reported operating income of $1.7 million on 2003 sales of more than $40 million, with EBITDA earnings of about $3 million. EBITDA is earnings before interest, taxes, depreciation and amortization. The Golf Warehouse has recorded a 5-year compounded growth rate of more than 60%, and it expects 2004 sales to hit $60 million, a rise of 50% over last year, Marney says. The retailer also operates a 7,000-square-foot store in Wichita.
Sportsman’s Guide, noting that The Golf Warehouse will immediately add to Sportsman’s earnings, says it is increasing its current revenue guidance for 2004 by 10% to 12% due to the acquisition.
Sportsman’s Guide, based in South St. Paul, MN, and , No. 71 in the Internet Retailer Top 300 Guide, reported net earnings for the first quarter ended March 31 of $1.2 million on $44.6 million in revenue, up from $957,000 in net earnings on $43.7 million in the year-earlier period.
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