Winmark Corp. 10-Q: Retained Earnings Grow, Stock Buybacks Continue

TL;DR

Winmark's retained earnings are up, stock buybacks are active, and they've got Prudential notes. Solid.

AI Summary

Winmark Corp. filed its 10-Q for the period ending September 28, 2024. The company reported retained earnings of $3,496,977 as of December 28, 2023, and $3,520,402 as of September 28, 2024. The filing also references a common stock repurchase program active as of September 28, 2024, and various note agreements with Prudential dating back to April 2022.

Why It Matters

This filing provides insight into Winmark Corp.'s financial health and ongoing capital allocation strategies, including stock repurchases and debt management.

Risk Assessment

Risk Level: low — The filing is a routine quarterly report with no immediate red flags or significant negative disclosures.

Key Numbers

• $3.52M — Retained Earnings (As of September 28, 2024, showing growth from the prior year.)
• Active — Common Stock Repurchase Program (Indicates ongoing efforts to return capital to shareholders.)

Key Players & Entities

• Winmark Corp. (company) — Filer of the 10-Q
• September 28, 2024 (date) — End of reporting period
• $3,496,977 (dollar_amount) — Retained earnings as of December 28, 2023
• $3,520,402 (dollar_amount) — Retained earnings as of September 28, 2024
• Prudential (company) — Party to note agreements
• April 2022 (date) — Start date of a note agreement

FAQ

Filing Documents

• wina-20240928x10q.htm (10-Q) — 1059KB
• wina-20240928xex31d1.htm (EX-31.1) — 14KB
• wina-20240928xex31d2.htm (EX-31.2) — 15KB
• wina-20240928xex32d1.htm (EX-32.1) — 9KB
• wina-20240928xex32d2.htm (EX-32.2) — 9KB
• 0000908315-24-000035.txt ( ) — 4698KB
• wina-20240928.xsd (EX-101.SCH) — 36KB
• wina-20240928_cal.xml (EX-101.CAL) — 51KB
• wina-20240928_def.xml (EX-101.DEF) — 113KB
• wina-20240928_lab.xml (EX-101.LAB) — 327KB
• wina-20240928_pre.xml (EX-101.PRE) — 227KB
• wina-20240928x10q_htm.xml (XML) — 669KB

Financial Statements (Unaudited)

Financial Statements (Unaudited) CONSOLIDATED CONDENSED BALANCE SHEETS September 28, 2024 and December 30, 2023 3 CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS Three Months Ended September 28, 2024 and September 30, 2023 Nine Months Ended September 28, 2024 and September 30, 2023 4 CONSOLIDATED CONDENSED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT) Three Months Ended September 28, 2024 and September 30, 2023 Nine Months Ended September 28, 2024 and September 30, 2023 5 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS Nine Months Ended September 28, 2024 and September 30, 2023 6 NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS 7 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 12 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 17 Item 4.

Controls and Procedures

Controls and Procedures 18 PART II. OTHER INFORMATION 18 Item 1.

Legal Proceedings

Legal Proceedings 18 Item 1A.

Risk Factors

Risk Factors 18 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 18 Item 3. Defaults Upon Senior Securities 19 Item 4. Mine Safety Disclosures 19 Item 5. Other Information 19 Item 6. Exhibits 19

SIGNATURES

SIGNATURES 20 2 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

: Financial Statements

ITEM 1: Financial Statements WINMARK CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) September 28, 2024 December 30, 2023 ASSETS Current Assets: Cash and cash equivalents $ 37,197,000 $ 13,361,500 Restricted cash 90,000 25,000 Receivables, less allowance for credit losses of $ 500 and $ 600 1,602,200 1,475,300 Net investment in leases - current — 75,100 Income tax receivable — 31,400 Inventories 441,800 386,100 Prepaid expenses 1,171,600 1,392,100 Total current assets 40,502,600 16,746,500 Property and equipment, net 1,519,000 1,669,800 Operating lease right of use asset 2,197,600 2,425,900 Intangible assets, net 2,728,800 2,994,300 Goodwill 607,500 607,500 Other assets 478,400 471,300 Deferred income taxes 3,917,300 4,052,400 $ 51,951,200 $ 28,967,700 LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) Current Liabilities: Notes payable, net of unamortized debt issuance costs of $ 27,900 and $ 32,100 $ 3,472,100 $ 4,217,900 Accounts payable 1,600,700 1,719,400 Income tax payable 30,400 — Accrued liabilities 3,776,100 2,858,200 Deferred revenue 1,670,100 1,666,100 Total current liabilities 10,549,400 10,461,600 Long-term Liabilities: Line of credit/Term loan 30,000,000 30,000,000 Notes payable, net of unamortized debt issuance costs of $ 68,800 and $ 88,700 32,431,200 34,848,800 Deferred revenue 8,028,600 7,657,500 Operating lease liabilities 3,260,100 3,715,800 Other liabilities 1,425,800 1,440,100 Total long-term liabilities 75,145,700 77,662,200 Shareholders' Equity (Deficit): Common stock, no par value, 10,000,000 shares authorized, 3,520,402 and 3,496,977 shares issued and outstanding 11,941,900 7,768,800 Retained earnings (accumulated deficit) ( 45,685,800 ) ( 66,924,900 ) Total shareholders' equity (deficit) ( 33,743,900 ) ( 59,156,100 ) $ 51,951,200 $ 28,967,7

View Full Filing

View this 10-Q filing on SEC EDGAR