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Harvey Q1 Net, Sales Revenues Rise

3/13/2002 12:51:00 PM Eastern

Lyndhurst, N.J. - With demand for new digital video technologies and custom installation services continuing to drive its business, Harvey Electronics posted higher net sales and income in its fiscal first quarter.

Sales climbed 7.5 percent, reaching $12.4 million, up from $11.6 million in the same quarter last year.

Net income rose 20.7 percent in the first quarter, hitting $390,448, up from $322,599 year over year.

'Given the magnitude of circumstances affecting New York City's economy during the past six months, we are pleased to report that comp-store sales for the fiscal 2002 first quarter decreased by only 2.6 percent from the prior year,' said Franklin Karp, president. 'We would like to note that this result is better than management expected and compares favorably with the results of other consumer electronics retailers.

'Net income benefited from narrowing operating losses associated with the opening of new stores and the company's Website,' Karp said. Harvey operates nine locations in the New York metro area.

Harvey reported that custom installation sales for the first fiscal quarter, ended Jan. 26, increased 38 percent from the same quarter last year. Custom installation sales of equipment and labor income accounted for almost 44 percent of the retailer's net sales, or $5.5 million, in the first quarter. This compares with 34 percent, or $4 million, in the year-ago period.

Gross profit margin in the first quarter increased 30 basis points, to 39.3 percent, while selling, general and administrative (SG&A) expenses were reduced by 1 percent in the first quarter, compared with the same three months last year.

The retailer said Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) increased about 22 percent to almost $1 million in the first three months, up from about $800,000 in the same period last year.