Indianapolis, Ind. - Lower
costs, richer margins and higher sales from the addition of 42 new stores
fueled a 45.7 percent increase in hhgregg's fourth quarter fiscal profits to
Net sales for the three
months ended March 31 rose 21.5 percent to $507 million, but same-store sales
declines across all major categories led to a 10.8 percent drop in comparable
Comps declined nearly 17
percent in video due primarily to a double-digit decline in average selling
prices (ASPs), driven by lower than expected demand for advanced TVs and a slight
decrease in unit demand.
Comps declined 5 percent
in major appliance sales due mostly to increased demand in the prior-year
period as a result of the government appliance stimulus programs, which were
not repeated this year.
Comps for the company's
catchall "other" merchandise category, which includes audio, computers,
personal electronics, furniture and mattresses, fell 4.2 percent due primarily to double-digit comp declines
in cameras and camcorders and mid-single-digit decreases in small electronics,
partially offset by double-digit increases in of computers and video games.
"Despite industry headwinds and inclement weather around the
Super Bowl selling period, we aggressively managed the business and delivered
meaningful earnings growth in the fourth fiscal quarter," said president/CEO Dennis
May. "Strong inventory management and solid execution allowed us to increase
gross margin by nearly 100 basis points while reducing per-store inventory
levels by approximately 20 percent compared to the prior year. Merchandise
margins were up across all key product categories and we remain pleased with
our new stores sales productivity and our return on investment of our new
Full year profits rose 23 percent to $48.2 million on sales of
$2.1 billion, an increase of 35.4 percent.