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Good Guys Reports Higher Q4 Comps, Net Sales

12/18/2000 02:00:00 AM Eastern

SAN FRANCISCO -Bolstered by a fourth-quarter comp-store sales increase of 16.5 percent, Good Guys reported that net sales for the three months ended Sept. 30 rose more than 10 percent, compared with the same period last year.

The retailer said net sales and sales for continuing categories were $212 million in the fourth quarter, compared with net sales of $192 million and sales for continuing categories of $182 million in the same quarter in 1999.

For the fourth quarter, Good Guys reported income from operations of $2 million, which includes a one-time lease-termination gain of $9.8 million, compared with a loss from operations of $23.3 million in the year-ago fourth quarter. Including interest expense and a tax charge, the retailer posted a net loss of $9.7 million, compared with a restated net loss of $25.5 million in the last three months in 1999.

Gross profit margin in the fourth quarter climbed 350 basis points to 26.9 percent, up from 23.4 percent in last year's fourth quarter. This was lower than immediately preceding quarters as a result of a more promotional ad and sales effort that helped fuel the double-digit sales growth.

SG & A benefited from a 500-basis-point bonanza, hitting 30.5 percent, down from 35.5 percent in the last three months of 1999.

Looking at the fiscal year, Good Guys reported a loss from operations of $1.3 million, which includes a one-time gain of $10.8 million, compared with a restated operating loss of $35.2 million for fiscal 1999.

"Fiscal 2000 was a year full of tremendous changes as well as tremendous progress," said chairman/CEO Ron Unkefer. "Over the past 12 months, we repositioned the company as a premier provider of fully featured, higher-end consumer entertainment electronics, reorganized our in-store structure, launched a new ad campaign, dramatically reduced costs, significantly reduced our operating loss, and substantially strengthened our management team.

"With all of these initiatives, we expect to continue seeing sizable improvements in both our sales and overall financial performance," Unkefer said.

Good Guys reported a net loss of $17.3 million for fiscal 2000, compared with a restated net loss of $39.9 million for the previous 12 months. Gross profit rose for the year to 28.6 percent, 430 basis points above the 24.3 percent recorded in the prior year. SG & A, however, was hurt by a difference of 190 basis points, reaching 30.1 percent, compared with 28.2 percent in fiscal 1999.

Sales for continuing categories and comparable-store sales for continuing categories both grew 5 percent for the year, increasing to $860.5 million, compared with $820.4 million in the previous 12 months.

Net sales for the year were $860.5 million, compared with $915.6 million in 1999. This reflects the elimination of low-margin computers and home office products, and the de-emphasis of entry-level offerings. n