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Sports Authority 4Q warns
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December 16, 1999: 5:39 p.m. ET
No. 1 U.S. sporting goods chain reports 4Q charge of $128M to $132M
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NEW YORK (CNNfn) - The Sports Authority Inc., the No.1 U.S. sporting goods chain, warned Thursday it would take a fourth-quarter after-tax charge of $128 million to $132 million.
The Fort Lauderdale, Fla.-based company said the charge consists of an $85 million write-down of certain assets, a $37 million reduction of certain deferred tax assets, and an $8 million charge connected to the closing of the company’s Canadian subsidiary.
"In light of our recent financial performance,” said Chief Financial Officer George Mihalko in a statement, "this fourth quarter charge will adjust our balance sheet to levels required by accounting standards. Cash flow will actually be positive since we will be able to capture a $10-$15 million tax refund through a tax loss carry-back."
Also, Sports Authority said it expects fourth-quarter operating results to include about $14 million of store closing costs related to two lease expirations and one upcoming relocation, and markdowns for slow selling seasonal merchandise and inventory shrink.
In addition, the company said it anticipates a cash inflow of $10 million to $15 million in May 2000 from a tax refund.
The company also said it increased its line of credit with a group of lenders from $200 million to $275 million.
Shares of Sports Authority (TSA) closed up 1/16 Thursday to 1-15/16.
Sports Authority operates 201 sporting goods stores, with 196 in 32 states and five stores in Canada. 
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The Sports Authority
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