The Woodlands, Texas — Reduced inventory stemming from the West Coast port labor disruption negatively impacted Conn’s same-store sales in March, while CE sales decreased because of a soft TV category.
Total same-store sales for the month, ended March 31, decreased 6.8 percent when stacked up against the 18.1 percent increase seen in the prior-year period. As was the case last month, the catch-all “other” category led the decline, with a decrease of 32.5 percent. Net retail sales, however, rose 3.4 percent for the month, reaching $103.7 million.
Reduced inventory availability contributed to a 10.8 decrease in comps for the furniture category. Inventory availability is expected to improve, but shortages will continue through at least April, cautioned Theodore M. Wright, Conn’s chairman and CEO.
Mattresses rose 0.9 percent because they are sourced in the U.S. and not affected by the port disputes.
Same-store CE sales dropped 4.7 percent due to softness in TV sales. The home appliance category was flat, while home-office comp unit sales were down, partially offset by higher average selling prices.
Noted Wright: “We continue to experience headwinds from tighter underwriting implemented during the first three quarters of fiscal year 2015 compared to the same period a year ago, with an estimated impact of approximately 4 to 5 percent to same-store sales in the month. The impact of tighter underwriting to our Arizona and New Mexico stores is less significant than previous periods.”
Conn’s underwent stricter underwriting standards and collections policies last year and is attempting to emerge from its credit issues.
“Greater than 60-day delinquency was 8.7 percent as of March 31, 2105, compared to 8.2 percent as of March 31, 2014, with a sequential decrease of 50 basis points from Feb. 28, 2015," said Wright.