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RadioShack Q3 Sales Slip 3%

10/26/2009 11:41:01 AM Eastern

Fort Worth, Texas - RadioShack said third-quarter profits fell 24 percent to $37.4 million and net sales slipped 3.1 percent to $990 million for the three months ended Sept. 30.

Same same-store sales at company-owned stores and kiosks decreased 2.9 percent due to slower sales of digital converter boxes, laptop computers, batteries, wireless accessories and GPS devices.

Declines in those categories were "substantially offset" by increases in RadioShack's Sprint Nextel postpaid wireless business; greater sales of netbooks, prepaid wireless handsets and airtime; and by the addition last summer of T-Mobile as a postpaid wireless carrier.

The chain said net sales fell 3.5 percent at company-owned stores, 5.1 percent online, 15.7 percent at dealer-owned stores, and 17.8 percent at kiosks, the later due to a reduced number of locations.

"Other" sales were up 13.5 percent, due largely to the addition of RadioShack's Mexican operation, which was acquired in December 2008.

Jim Gooch, executive VP and chief financial officer, said the company's financial performance improved in the latter part of the quarter thanks to strength in its wireless business and "an economy showing some signs of potential stabilization."

Chairman/CEO Julian Day described "The Shack" marketing campaign as a key strategic effort, and said it will continue to fine-tune and invest in the rebranding program following a successful launch this summer.

Day added that the recent addition of T-Mobile to its stores and Verizon Wireless to its Sam's Club kiosks "further enhances our mobility proposition."

Looking ahead, the company continues to peg capital expenditures for the full year at between $75 million and $100 million
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