h.h.gregg’s Q2 Comps Fall 6.2%

By Alan Wolf On Oct 31 2013 - 9:14am




Indianapolis — h.h.gregg said a precipitous drop in its TV business, and reduced revenue from mobile phones and notebook computers, led to sales and earnings declines in its fiscal second quarter.

Net income slipped 2 percent to $3.7 million for the three months, ended Sept. 30, while net sales decreased 3.3 percent to $568.3 million.

Comp-store sales fell 6.2 percent on a double-digit comp sales decline in TV caused by a strategic decision to offer fewer opening price point models, while computer and wireless comps fell 7.2 percent year over year.

In contrast, majap comps edged up 2.6 percent on higher average selling prices (ASPs), suggesting lower unit volume, and same-store home product sales soared 69 percent with the introduction of furniture and fitness equipment.

Majaps represented 50 percent of the sales mix during the quarter, up from 46 percent last year, followed by CE at 36 percent, down from 42 percent; computing and wireless flat at 9 percent; and home products up from 3 percent to 5 percent.

In a statement, h.h.gregg president/CEO Dennis May pointed to the multiregional chain’s ninth consecutive quarter of majap comp gains, and the completion of a sales floor reset to accommodate the new furniture and exercise equipment SKUs and an expanded assortment of premium TVs.

“While pleased with our early efforts in reshaping our sales mix, our sales performance continues to demonstrate that this transition will take time as we introduce new products to offset the sales losses from the consumer electronics category,” he said.

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