ENGLEWOOD, CO-The Sports Authority Inc., the nation's largest sporting good store retailer, reported net income in the second quarter of $14.2 million, or 53 cents per diluted share, compared with a net income of $6.8 million, or 26 cents per share in the second quarter of 2004. Last year's figures included merger integration costs for the company that had been rapidly expanding through acquisitions and is based in this city southwest of Denver.

Excluding the effect of after-tax merger integration costs of $5.1 million, or 19 cents per diluted share, net income for the prior year's second quarter was $11.9 million, or 45 cents per diluted share. Total sales for the second quarter were $617 million compared with $605 million in the prior year's second quarter, an increase of $12 million, or 2%. Second quarter comparable store sales for the company increased 0.2%.

Net income for the 26 weeks ended July 30 was $22.2 million, or 83 cents per diluted share, compared with net income of $10.9 million, or 41 cents per diluted share, including merger integration costs, in the prior year's comparable period. Excluding the effect of after-tax merger integration costs of $10.4 million, or 39 cents per diluted share, net income for the prior year's 26 weeks was $21.3 million, or 80 cents per diluted share. Total during the same time period were $1.21 billion compared with $1.18 billion in the prior year's comparable period, an increase of $31.2 million, or 2.7%. Comparable store sales increased 1%. The company opened one store and closed two stores during the second quarter to arrive at a total number of stores in operation as of July 30, 2005 of 392 stores in 45 states.

"We exceeded earnings expectations for the second quarter driven by improvements in gross margin and effective management of our operating expenses," says Doug Morton, CEO of the chain. "We were pleased with the sales performance of several key categories including active apparel and fitness, however, the impact on our top line performance was greater than expected due to our decision not to repeat certain promotional events."

For the third quarter of fiscal 2005, Sports Authority is forecasting a comparable store sales increase of approximately 1% to 2%, total sales of approximately $565 million and diluted EPS of 9 cents, based on 26.8 million diluted shares outstanding in the quarter. The company expects to open five new stores and relocate two stores during the third fiscal quarter.

For fiscal year 2005, the company is forecasting comparable store sales to increase approximately 1.5%. The company also stated that it is raising its fiscal year 2005 diluted EPS guidance to $1.96 to $2.01, based on an estimated 26.7 million diluted shares outstanding, compared to its previous guidance of $1.90 to $1.97. The company expects to open approximately 13 stores, relocate four stores and close seven stores during the year.