Q1 Profit Dips For hhgregg
By John Laposky -- TWICE, 8/7/2009
Indianapolis - First-quarter profit at hhgregg declined slightly from the same period last year, to 29.8 percent from 30.6 percent, a result of declining gross margins and weaker comp-store sales.
For the quarter, the retailer reported net income of $1.5 million, compared with $2.1 million. Net sales fell 3.7 percent to $284.4 million. Comp-store sales declined 14.7 percent, with the chain citing soft demand in major appliances and price erosion in LCD TVs.
The results topped Wall Street's expectations.
While giving forward guidance to analysts, the company affirmed its plan to open 20 to 22 new stores in fiscal 2010, with the majority scheduled to be opened prior to the holiday selling season.
The chain announced last month that its long-range growth plans are focused on expanding into large and midsized metropolitan markets in the Mid-Atlantic states, with as many as 45 new stores and a fourth distribution center. Future markets cited included Baltimore, Philadelphia and Washington.
A stock offering intended to raise as much as $54 million to fuel the expansion was announced in July.
hhgregg currently operates 114 stores in Alabama, Florida, Georgia, Indiana, Kentucky, North Carolina, Ohio, South Carolina and Tennessee.
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