WINA Exchange Traded Fund

MINNEAPOLIS, July 15 /PRNewswire-FirstCall/ -- Winmark Corporation (NASDAQ:WINA) announced today net income for the quarter ended June 27, 2009 of $1,195,300, or $.22 per share diluted, compared to net income of $930,500, or $.17 per share diluted, in 2008. For the six months ended June 27, 2009, net income was $2,609,000, or $.49 per share diluted, compared to net income of $1,867,800, or $.34 per share diluted, for the same period last year. John L. Morgan, Chairman and Chief Executive Officer, stated, "Our second quarter performance was acceptable in light of the current economic environment. Our franchising and middle market leasing businesses performed well, but we have been negatively impacted by write-offs in our small business leasing portfolio. We fully expect the small business portfolio to continue to perform poorly until there is a broad recovery in the U.S. economy." Winmark Corporation creates, supports and finances business. At June 27, 2009, there were 867 franchises in operation under the brands Play It Again Sports , Once Upon A Child , Plato's Closet and Music Go Round and there were 43 territories in operation under the Wirth Business Credit brand. An additional 51 retail franchises have been awarded but are not open. In addition, at June 27, 2009, the Company had loans and leases equal to $44.1 million. This press release contains forward-looking statements within the meaning of the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), relating to future events or the future financial performance of the Company including statements with respect to our ability to finance the growth of our leasing and franchising businesses for the foreseeable future. Such forward-looking statements are only predictions or statements of intention subject to risks and uncertainties and actual events or results could differ materially from those anticipated. Because actual result may differ, shareholders and prospective investors are cautioned not to place undue reliance on such forward-looking statements. WINMARK CORPORATION CONDENSED BALANCE SHEETS (unaudited) June 27, December 27, 2009 2008 -------- ------------ ASSETS Current Assets: Cash and cash equivalents $8,702,300 $2,140,000 Marketable securities 1,040,600 438,300 Current investments 1,500,000 500,000 Receivables, less allowance for doubtful accounts of $49,600 and $52,700 1,714,700 2,064,100 Net investment in leases - current 15,999,600 17,379,700 Income tax receivable 408,500 792,200 Inventories 72,800 141,500 Prepaid expenses 574,100 1,018,800 Deferred income taxes - 216,900 --- ------- Total current assets 30,012,600 24,691,500 Net investment in leases - long-term 26,074,400 28,035,300 Long-term investments 2,829,200 3,833,300 Long-term receivables, net 26,700 39,200 Property and equipment, net 2,041,100 512,200 Other assets 677,500 677,500 Deferred income taxes - 320,800 --- ------- $61,661,500 $58,109,800 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Current line of credit $3,899,200 $4,313,200 Current renewable subordinated notes 8,277,700 8,052,400 Accounts payable 1,387,700 1,108,200 Accrued liabilities 2,470,400 2,905,400 Current discounted lease rentals 1,142,100 1,012,900 Current rents received in advance 229,000 141,600 Current deferred revenue 1,161,300 993,600 Deferred income taxes 368,300 - ------- --- Total current liabilities 18,935,700 18,527,300 Long-term line of credit 7,307,100 9,276,300 Long-term renewable subordinated notes 15,115,400 12,788,700 Long-term discounted lease rentals 858,500 1,298,500 Long-term rents received in advance 1,493,100 1,696,400 Long-term deferred revenue 694,900 631,400 Other long-term liabilities 1,217,500 - Deferred income taxes 490,700 - Shareholders' Equity: Common stock, no par, 10,000,000 shares authorized, 5,307,589 and 5,433,610 shares issued and outstanding - 427,500 Accumulated other comprehensive income (loss) 71,400 (38,500) Retained earnings 15,477,200 13,502,200 ---------- ---------- Total shareholders' equity 15,548,600 13,891,200 ---------- ---------- $61,661,500 $58,109,800 =========== =========== WINMARK CORPORATION CONDENSED STATEMENTS OF OPERATIONS (Unaudited) Quarter Ended Six Months Ended June 27, June 28, June 27, June 28, 2009 2008 2009 2008 ---------- -------- ---------- ---------- REVENUE: Royalties $5,607,900 $5,303,800 $11,241,400 $10,635,400 Leasing income 2,143,100 1,907,000 4,844,800 3,859,600 Merchandise sales 679,300 975,000 1,304,700 1,907,800 Franchise fees 235,000 386,100 385,000 913,600 Other 172,800 145,400 312,200 278,300 ---------- -------- ---------- ---------- Total revenue 8,838,100 8,717,300 18,088,100 17,594,700 COST OF MERCHANDISE SOLD 651,100 940,700 1,247,000 1,834,600 LEASING EXPENSE 512,800 463,100 1,195,300 949,000 PROVISION FOR CREDIT LOSSES 604,200 269,200 1,023,900 654,300 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 4,830,600 5,138,500 9,713,100 10,324,300 ---------- -------- ---------- ---------- Income from operations 2,239,400 1,905,800 4,908,800 3,832,500 LOSS FROM EQUITY INVESTMENTS (600) (60,700) (4,100) (136,500) INTEREST EXPENSE (341,400) (340,200) (692,500) (688,600) INTEREST AND OTHER INCOME 111,600 59,000 172,700 131,800 ---------- -------- ---------- ---------- Income before income taxes 2,009,000 1,563,900 4,384,900 3,139,200 PROVISION FOR INCOME TAXES (813,700) (633,400) (1,775,900) (1,271,400) ---------- -------- ---------- ---------- NET INCOME $1,195,300 $930,500 $2,609,000 $1,867,800 ========== ======== ========== ========== EARNINGS PER SHARE - BASIC $.22 $.17 $.49 $.34 ========== ======== ========== ========== EARNINGS PER SHARE - DILUTED $.22 $.17 $.49 $.34 ========== ======== ========== ========== WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC 5,328,831 5,534,781 5,362,489 5,517,807 ========== ======== ========== ========== WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED 5,343,532 5,562,319 5,370,900 5,548,482 ========== ======== ========== ========== DATASOURCE: Winmark Corporation CONTACT: John L. Morgan of Winmark Corporation, +1-763-520-8500 Web Site: http://www.winmarkcorporation.com/

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