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RadioShack's Adjusted Net Income Drops 14 Percent During 4th Quarter

2/25/2002 02:00:00 AM Eastern

RadioShack reported adjusted net income in the fourth quarter, excluding charges, of $125.7 million, down 14 percent from the $145.8 million adjusted net income recorded in the year-ago period.

When restructuring costs, including those spent to close unprofitable stores, are factored into RadioShack's financials for the fourth quarter ended Dec. 31, reported net income hit $35.2 million.

The consumer electronics retailer reported a 4 percent decrease in sales for the fourth quarter, hitting $1.52 billion, compared with $1.58 billion in the same three months in 2000. Comp-store sales for the fourth quarter were down 2 percent.

"Many favorable financial trends have emerged despite lower fourth-quarter sales," said Len Roberts, chairman/CEO. "Gross margin percentage turned 110 basis points positive on an adjusted basis, expense controls are bearing fruit and the company is generating a tremendous amount of cash."

For the 12 months, RadioShack's adjusted net income was $291.8 million, down 21 percent from the adjusted net income of $367.4 million recorded for the previous year. Reported net income, including charges for the 12 months, reached $166.7 million, compared with $368 million in 2000.

Year-end total sales were flat, coming in at $4.78 billion, compared with $4.79 billion the previous 12 months. Comp-store sales for the year increased 1 percent.

RadioShack said it is confident it will deliver 13 percent to 15 percent earnings-per-share growth in 2002. First-quarter expectations include lower sales, substantial improvements in gross margin rate and roughly flat Selling, General and Administrative (SG&A) costs.

The retailer announced in mid-February that it plans to offer consumers both DirecTV and DISH Network direct-to-home satellite TV. RadioShack, which claims it will be the only national retailer selling both these digital satellite TV services, said it will begin offering DISH Network products in its stores nationwide by April.

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