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DAMARK INTERNATIONAL, INC. REPORTS RESULTS FOR FIRST THREE QUARTERS

DAMARK INTERNATIONAL, INC. REPORTS RESULTS FOR FIRST THREE QUARTERS
 MINNEAPOLIS, Oct. 13 /PRNewswire/ -- DAMARK International, Inc., (NASDAQ: DMRK) today reported results for the third quarter and nine months ended Sept. 26, 1992. For the third quarter, net sales increased 32 percent to $62.7 million compared with $47.5 million for the same period in 1991. Net income increased 42 percent to $715,000 from $503,000 last year. On a per share basis, given a 41 percent increase in shares outstanding, earnings were nine cents in each quarter.
 For the three quarters, net sales increased 34 percent to $188.2 million from $140.0 million reported in the year-ago period. Operating income grew 25 percent to $3.0 million from $2.4 million last year. The company reported net income of $1.1 million, compared with $133,000 for the year-ago period. On a per share basis, excluding the effects of a warrant valuation increase of $4.9 million in the first quarter of 1992, net income was 15 cents versus two cents for the prior- year period.
 DAMARK's third quarter gross profit margin of 25.6 percent was 4.2 percentage points below the second quarter, reflecting strong sales of relatively lower margin computer products. The results for the quarter also included multiple computer sales to several vendors. Back- end sales accounted for 76 percent of the third-quarter sales mix. As of Sept. 26, DAMARK's proprietary customer list grew to 3.2 million names, approximately 10 percent of which are members of the company's Preferred Buyers' Club.
 "We are pleased with our continued progress and are optimistic about the fourth quarter despite the continued sluggish retail environment," said Mark Cohn, chairman, president and chief executive officer. "We're beginning to see benefits from the quality changes we've made in our catalogs and our new stronger PBC program."
 Founded in 1986, DAMARK International, Inc., headquartered in Minneapolis, is a leading national direct merchandiser of "great deals," offering brand name and other quality merchandise at value-oriented prices.
 DAMARK INTERNATIONAL INC.
 STATEMENTS OF OPERATIONS
 (dollar amounts in thousands except per share data)
 (unaudited)
 Quarter Ended Three Quarters Ended
 Sept. 26, Sept. 28, Sept. 26, Sept. 28,
 1992 1991 1992 1991
 Net sales $62,681 47,494 $188,233 $139,960
 Cost of sales 46,623 32,721 136,895 97,368
 Gross profit 16,058 14,773 51,338 42,592
 Selling, general and
 administrative expenses 14,622 13,374 48,376 40,219
 Operating income 1,436 1,399 2,962 2,373
 Interest expense
 (income), net 270 564 1,243 1,690
 Other expense, net 66 78 138 168
 Income before taxes and
 cumulative effect of change
 in accounting principle 1,100 757 1,581 515
 Income tax expense 385 254 560 382
 Income before cumulative
 effect of change in
 accounting principle -- -- 1,021 133
 Cumulative effect of
 change in income tax
 accounting method,
 net of taxes -- -- 91 --
 Net income $715 $503 $1,112 $133
 Income (loss) per common
 share and common share
 equivalents:
 Income (loss) before
 cumulative effect of
 change in accounting
 principle per common
 share and common share
 equivalents $0.09 $0.09 $(0.53) $0.02
 Cumulative effect of
 change in income tax
 accounting, net of
 taxes per common share
 and common share
 equivalents -- -- 0.01 --
 Net income (loss) per
 common share and common
 share equivalents $0.09 $0.09 $(0.52) $0.02
 Weighted average common
 share and common share
 equivalents
 outstanding (000s) 8,031 5,715 7,205 5,694
 Supplemental income per
 common share and common
 share equivalents
 excluding the impact of
 the increase in the
 value of warrants of
 $4,891 in 1992:
 Net income per common
 share and common share
 equivalents $0.09 $0.09 $0.15 $0.02
 Weighted average common
 shares and common
 share equivalents 8,031 5,715 7,392 5,694
 -0- 10/13/92
 /CONTACT: John Mackay of Padilla Speer Beardsley, 612-871-8877, for DAMARK International; or James Tuller of DAMARK International, 612-531-0066/
 (DMRK) CO: Damark International, Inc. ST: Minnesota IN: REA SU: ERN


AL -- MN017 -- 9476 10/13/92 16:12 EDT
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Publication:PR Newswire
Date:Oct 13, 1992
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