Conn's Q4 Earnings Rebound

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Beaumont, Texas - Conn's reported fiscal fourth-quarter profits of $7.7 million, compared with a year-ago loss of $3.6 million.

Total revenue for the three months, ended Jan. 31, increased 3.7 percent to $226.7 million, and same-store sales rose 12.1 percent.

The regional furniture, majap and CE chain attributed the gains to a greater mix of higher-margin furniture and mattresses, higher average selling prices across all core categories, and increased sales of extended-service agreements.

Adjusted operating income for Conn's retail segment rocketed 343 percent to $9.3 million, excluding $5.1 million in costs for closing five underperforming stores in January.

Operating income for the credit segment rose 82 percent to $12.2 million thanks to reduced portfolio balances, rising interest yields and lower servicing costs, the company said.

For the full fiscal year, the company lost $3.7 billion on total revenue of $808.8 million, a decline of 2 percent.

"We are pleased to report improved profitability in both our credit and retail segments," said chairman/CEO Theo Wright. The trend is continuing into the current quarter, he noted, with combined February and March same- store sales growing 16.1 percent and retail gross margin outpacing Q4 levels.

 "Sales and gross margins are increasing," he said. "We are on track with our store opening plans" -- which call for five to seven locations in new markets this year -- "and are looking forward to returning to unit growth after a period of retrenchment."


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