Beaumont, Texas - Conn's, the multiregional electronics, appliance and furniture chain, said a weak local economy and tightened consumer credit lead to a 19.8 percent drop in comp-stores sales during its fiscal first quarter, ended April 30.
Net sales, excluding revenue from the company's in-house finance operation, fell 18.6 percent to $162.8 million during the period.
The downturn was led by a 23.3 percent decline in unit sales of flat-panel TVs and a 12.2 percent decline in average selling prices, chiefly for LCDs.
The company also reported a 16 percent decline in majap sales, reflecting lower unit volume in all appliance categories despite the benefit of the Energy Star rebate program that was launched in Texas last month.
Sales within the stores' central "track" section slipped 1.1 percent as increased sales of laptop and desktop computers, the introduction of netbooks, and higher digital camera and accessory sales were offset by declining sales of camcorders, GPS devices and video game hardware, the company said.
Despite the downturn, sales trends successively improved during each month of the quarter, and retail gross margin rose to approximately 27 percent for the three months, compared with 23.7 percent during the preceding quarter and 25 percent during the year-ago period, as management focuses on profitability while maintaining price competitiveness, Conn's said.
The company also reported rising average selling prices in appliances.
The net sales decline was partially offset by the opening of two new stores last year, although the gains were offset by the closure of a clearance center. The NATM retailer currently operates 76 stores in Texas, Louisiana and Oklahoma.
Conn's will report its full first-quarter results on May 27.