hhgregg Posts Dour Holiday Quarter - Twice

hhgregg Posts Dour Holiday Quarter

Comps slip 6% during retail’s busiest season
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Sharp declines in hhgregg’s computer, tablet and TV businesses, and its exit from the mobile and fitness categories, led to lower sales and an $87 million loss for its fiscal third quarter.

Indianapolis – Sharp declines in hhgregg’s computer, tablet and TV businesses, and its exit from the mobile and fitness categories, led to lower sales and an $87 million loss for its fiscal third quarter.

Net sales slipped 5.9 percent to $665.6 million for the three months ended Dec. 31, and comparable store sales sank 6.3 percent.

The net loss compares to a year-ago profit of $5 million.

Broken out by product category:

*Majaps remained essentially flat in unit and dollar volume and average selling price (ASP);

*TVs suffered a double-digit decline in unit volume, offset slightly by increased sales of higher-priced, fully-featured big-screen models;

*Computer and tablet comps sank 35 percent, reflecting weak demand, lower ASPs and the company’s exit from the post-paid mobile business, and;

*Home products comps fell 9.2 percent, reflecting the company’s exit from the fitness equipment category and a double-digit decline in unit volume of TV stands, recliners and sofas, offset slightly by higher ASPs and increased unit sales of mattresses.

The company didn't break out its online comp sales.

In a statement, president/CEO Dennis May said the results reflect improvement over the prior quarter’s sales trends, particularly in CE and majaps, as the company continues to transform its business model.

To help accelerate its progress, the chain recently replaced its chief merchandising officer with American TV alumnus Keith Zimmerman, added several other industry vets to its senior management ranks, and brought in a retail consultancy to help rationalize its marketing spend and to optimize its logistics network, May said.

“We remain confident in our ability to make meaningful improvements in the coming fiscal year,” he noted.

The chain presently operates 228 stores in 20 states.

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