NEW YORK — Dwindling consumer confidence and the stagnant economy have finally caught up with the home electronics sector, as reflected in the flat to negative same-store sales posted this month by two benchmark CE specialists.
Although Commerce Department data showed a 3.1-percent spike in April year-over-year retail sales across the board, RadioShack, the nation's fifth-largest consumer electronics retailer, said that total revenue was down 4 percent last month to $313.4 million, while same-store sales slid 2 percent.
"April proved to be a challenging month for us," conceded chairman/ CEO Len Roberts. "The current economic slowdown, plus a negative shift in the April calendar, clearly impacted our business." He said he was confident that this month's launch of the previously announced Verizon Wireless in-store shops, and a "new financial model" for its flagging home satellite business, due out in June, "will help us begin to regain our sales momentum."
Meanwhile, the quarter ending April 30 also proved trying for leading regional CE specialty retailer Ultimate Electronics. Despite a 21-percent hike in total revenue to $115 million that was bolstered by new store openings, comparable-store sales were flat for the 37-unit chain, forcing it to lower its sales and earnings projections for the year.
President/chief operating officer Dave Workman noted that while sales of digital products continued to build momentum during the quarter, "the overall softness in consumer spending held back the growth of the more established categories." He added that the sluggish sales environment could well continue through the second quarter, but saw signs of relief in the upper-single-digit comp-store gains garnered in early May.
Among broad line merchants, Sears said total revenue rose 1.7 percent to $2.2 billion for the four weeks ended May 5, while same-store sales edged up 1.3 percent. Chairman/CEO Alan Lacy observed that "the overall retail environment continues to be challenging," although "solid increases in appliances," as well as other hardline sectors, "were offset by decreases across other categories."
Majap sales, in the guise of room air conditioners, also helped BJ's Wholesale Club realize revenue gains. Total sales were up 9.7 percent to $362 million in April, while same-store sales rose 5 percent. President/CEO Jack Nugent attributed the uniquely strong showing to "a strong rebound in seasonal sales" due to warmer springtime weather during the back half of the month.
Also buoying the Commerce Department data was Wal-Mart, whose sales soared 13.9 percent to $16.2 billion, while comp-store revenue rose a healthy 6.5 percent for the four weeks ended May 4. Similarly, April sales showered $2.2 billion in revenue on Target Stores, representing a 9.9 percent hike over the year-ago period, while same store sales rose 2 percent.
But the other leading national discount chain, Kmart, continued to struggle last month as sales slackened 0.4 percent to $2.8 billion and same-store sales edged up 1.1 percent.