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Conn’s Q4 Sales Sink 30%

3/11/2010 01:17:00 PM Eastern

BEAUMONT, TEXAS — Conn’s said
price deflation and weak demand drove net
sales down 30.3 percent to $171 million for
its fiscal fourth quarter, ended Jan. 31.

The multiregional electronics, appliance
and furniture chain also reported a 31.7 percent
decline in same-store sales during the
three-month period, which it attributed in
part to tough year-over-year comparisons.

The company cited “more challenging
economic conditions” in its markets
compared with last year, when Conn’s
also benefited from hurricane replacement
sales, Circuit City’s dissolution, and
an extra week of Super Bowl-related purchases
during the 2009 reporting period.

Conn’s said its sales results were also
impacted by its tightened credit underwriting
standards, the closure of two
outlet centers, and by reduced delivery
charges and extended-warranty commissions
due to fewer purchases.

Broken out by category, CE revenue declined
38.5 percent as a result of an 18.7
percent drop in unit sales of flat-panel TVs
and declines in average selling prices.

Dollar sales of major appliances declined
by 26 percent during the quarter
on lower unit sales in all appliance categories,
although average selling prices increased
slightly,

Small CE and countertop appliance revenue
declined 23 percent despite increased
unit sales of laptop and desktop computers
and the introduction of netbooks. Those
gains were offset by declines in the average
selling price of computers and reduced demand
for other small electronic and appliance
products located within the central
“track” section of Conn’s stores.

The company also cited a 26 percent
decline in furniture/mattress revenue.

For the full fiscal year, ended Jan. 31,
net sales were $722.8 million, a decrease
of $82.3 million, or 10.2 percent, while
same-store sales decreased 13.8 percent
for the 12 months.

Conn’s will report its fourth-quarter
and full-year earnings on March 25.

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