Fort Worth, Texas, – RadioShack, which has been subject of
takeover rumors in recent weeks, reported higher net sales and net earnings for
the second quarter, ended June 30.
Total net sales and operating revenues for the quarter
increased 4.7 percent to $1.01 billion, compared with $965.7 million for the
prior year’s second quarter.
Net income for
the second quarter increased 8.6 percent to $53 million, compared with net
income of $48.8 million reported for the same period last year.
Comp-store sales for company-operated stores and kiosks
increased 6.7 percent during quarter, compared with the prior year.
“In the second quarter, we worked hard to continue to
strengthen our brand with particular emphasis on the mobility sector,” said
Julian C. Day, chairman/CEO in a statement.
“This quarter we increased our marketing spend to emphasize
our mobility focus, and we believe the overall results we achieved reflect the
success of this strategy,” said Jim Gooch, executive VP/chief financial officer.
“We also increased our investment in inventory primarily related to the strong
growth in our wireless platform.”
Gooch added that RadioShack recently completed a pilot of
wireless kiosk locations inside Target stores and now plans to rollout kiosks
in the majority of Target store locations by mid-2011. The full mobile service,
known as Bullseye Mobile, will begin rolling out to select Target stores Aug.
15.
RadioShack also said that it entered into an agreement with
one of its wireless service providers pertaining to upfront commissions.
The 4.7 percent increase in total net sales and operating
revenues for the 2010 second quarter was driven by a $52.5 million or 6.4
percent increase in sales generated by U.S. company-operated stores. This
increase was partially offset by a $7.9 million decrease in kiosk sales. The
decrease in kiosk sales was attributable to fewer kiosk locations and the
closure of Sprint-branded kiosks in August 2009, partially offset by strong comp-store
revenue gains in Sam’s Club kiosk locations. The increase in other sales of $1.1
million was primarily due to sales growth in company-operated stores in Mexico,
the chain said.
The 6.7 percent increase in comp-store sales for
company-operated stores and kiosks during the 2010 second quarter was driven by
higher postpaid wireless sales, the addition of T-Mobile as a third postpaid
wireless carrier in company-operated stores, and higher sales of prepaid
wireless handsets and airtime. These increases were partially offset by a
decline in sales of digital converter boxes.
