Sport Supply Group Announces Fiscal 2004 Third Quarter Results; Net Income increases to $.6 million from prior year loss of $2.4 million

DALLAS --(Business Wire)-- Feb. 11, 2004 Sport Supply Group, Inc. (OTCBB:SSPY), a leading institutional sporting goods distributor, today announced results for the three and nine months ended December 26, 2003.
Revenues were $14.7 million for the quarter and $59.7 million for the nine months ended December 2003, remaining relatively unchanged from the prior year periods. Gross profit, as a percentage of revenues, declined to 25.5% and 26.8% from 25.9% and 28.4% for the three and nine months ended December 2003 and December 2002, respectively. This decline was primarily due to aggressive competitive pricing and increased costs associated with freight and import expenses. Net income increased substantially to $581,000 from a loss of $2.4 million in the same period a year ago. The increase in net income was due to a gain realized from the sale of Athletic Training Equipment Company, Inc., the Company's wholly owned subsidiary ("ATEC"). Earnings per share were $0.07 for the quarter compared to a loss per share of $0.26 for the same quarter last year with year to date earnings per share rising to $0.05 compared to a loss per share of $1.07 last year.

During the December 2003 quarter, the Company substantially restructured its operations by discontinuing or selling certain of its team dealer operations and selling ATEC. The discontinuance and related sales of these operations resulted in a $3.2 million gain on discontinued operations for the quarter ended December 2003 and a year-to-date gain of approximately $3.0 million. The prior year to date period reflects a one-time, $7.4 million non-cash charge from the cumulative effect of accounting change associated with implementing Financial Accounting Standards Board Statement 142 (Accounting for Goodwill and Other Intangible Assets).

Geoffrey P. Jurick, Chairman & Chief Executive Officer of Sport Supply Group stated, "We are pleased to have sold ATEC as well as the various team dealer locations. These restructuring efforts were critical in improving SSG's balance sheet strength and liquidity in addition to allowing us to more directly focus on our core business."

Commenting further, Mr. Jurick stated, "As evidenced by the reduction in debt of approximately $10 million, SSG is clearly in a better position to address its competitive business environment."

SSG also announced that it has changed its fiscal year-end to March 31. Previously, SSG maintained a 52/53 week fiscal year ending on the last Friday in March of each year. SSG will now maintain a fiscal year beginning on April 1 of each year and ending on March 31 the following year. In connection with this change, SSG will now maintain fiscal quarters ending on June 30, September 30, December 31 and March 31 of each year. Consequently, the quarter ending June 30, 2004 will include the transition period from March 27, 2004 through March 31, 2004.

Sport Supply Group is a leading direct marketer and B2B e-commerce supplier of sporting goods equipment to the institutional and youth sports market place. Athletes, coaches and instructors in schools, colleges, universities, governmental agencies, camps and youth organizations across the country use the Company's products.

For more information about Sport Supply Group or to sign up as an associate for your organizations own on-line sporting goods store, please visit www.sportsupplygroup.com.

This news release, other than the historical information, consists of forward looking statements that involve risks and uncertainties detailed from time to time in the Company's filings with the Securities and Exchange Commission, including the Company's Reports on Form 10-K and Form 10-Q. Such forward-looking statements are made based on management's belief as well as assumptions made by, and information currently available to, management pursuant to the 'safe harbor' provisions of the Private Securities Litigation Reform Act of 1995. Actual results may vary materially. -0-

SPORT SUPPLY GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

Three Months Ended Nine Months Ended
December December December December
2003 2002 2003 2002
------------ ------------ ------------ ------------
Net revenues $14,725,593 $15,126,330 $59,704,979 $58,711,581
Cost of sales 10,978,003 11,215,159 43,723,052 42,054,673
------------ ------------ ------------ ------------
Gross profit 3,747,590 3,911,171 15,981,927 16,656,908
Selling, general &
Administrative
expenses 6,205,269 6,135,731 18,215,298 18,938,253
------------ ------------ ------------ ------------
Operating loss (2,457,679) (2,224,560) (2,233,371) (2,281,345)
Interest expense (116,435) (134,417) (413,476) (445,817)
Other income, net 2,050 19,960 4,412 15,898
------------ ------------ ------------ ------------
Loss from
continuing
operations
Before income tax
and cumulative
Effect of
accounting
change (2,572,064) (2,339,017) (2,642,435) (2,711,264)
Provision for
income taxes
for continuing
operations -- (111,485) -- --
------------ ------------ ------------ ------------
Loss from
continuing
operations (2,572,064) (2,450,502) (2,642,435) (2,711,264)
Discontinued
operations, net of
tax 3,153,327 91,693 3,048,483 584,400
Cumulative effect
of accounting
change -- -- -- (7,442,432)
------------ ------------ ------------ ------------
Net income (loss) $581,263 $(2,358,809) $406,048 $(9,569,296)
============ ============ ============ ============

Basic earnings
(loss) per share:
Loss from
continuing
operations $(0.29) $(0.27) $(0.30) $(0.30)
Discontinued
operations 0.36 0.01 0.35 0.06
Cumulative effect
of accounting
change 0.00 0.00 0.00 (0.83)
------------ ------------ ------------ ------------
Basic earnings
(loss) per share $0.07 $(0.26) $0.05 $(1.07)
============ ============ ============ ============

Diluted earnings
(loss) per share:
Loss from
continuing
operations $(0.29) $(0.27) $(0.30) $(0.30)
Discontinued
operations 0.36 0.01 0.35 0.06
Cumulative effect
of accounting
change 0.00 0.00 0.00 (0.83)
------------ ------------ ------------ ------------
Diluted earnings
(loss) per share $0.07 $(0.26) $0.05 $(1.07)
============ ============ ============ ============

Weighted average common
shares outstanding
Basic 8,917,244 8,917,244 8,917,244 8,917,244
Diluted 8,924,101 8,917,244 8,925,208 8,917,244

-0-

SPORT SUPPLY GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED SUMMARY BALANCE SHEETS
(UNAUDITED)

December 26, 2003 March 28, 2003
----------------- ----------------
Cash and cash equivalents 2,643,132 2,142,302
Accounts receivable 8,586,945 20,245,675
Inventory 17,670,670 19,564,314
Other current assets 2,596,355 2,102,125
----------------- ----------------
Total current assets 31,497,102 44,054,416
Plant, property and equipment 7,106,165 8,519,936
Other assets 6,438,313 9,421,287
----------------- ----------------
Total assets 45,041,580 61,995,639
----------------- ----------------

Current liabilities 9,688,363 16,338,359
Long term debt 6,901,642 17,611,753
Stockholder's equity 28,451,575 28,045,527
----------------- ----------------
Total liabilities and equity 45,041,580 61,995,639
----------------- ----------------

Please refer to our Form 10-Q as filed with the SEC for more in depth financial and company information.

Sport Supply Group, Inc.
Bob Mitchell, 972-484-9484