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Harvey Reports Lower Q4, Annual Sales

Lyndhurst, N.J. — Harvey Electronics, the New York metro area specialty chain, reported lower sales for its fiscal fourth quarter and year end sales results ended Oct. 28.

For the twelve months, net sales aggregated $36.1 million, a decrease of approximately $4.4 million or 10.8 percent from the same period last year. Comparable-store sales for the year decreased approximately $5.9 million or 14.7 percent from the same period last year.

For the fourth quarter of fiscal 2006, net sales aggregated $7.5 million, a decrease of $2.1 million or 21.7 percent. Comparable store sales for the fourth quarter of fiscal 2006 were consistent with these results.

Martin McClanan, interim CEO, stated, “Fiscal 2006 sales results are disappointing and not acceptable to the new management team and the new board. The company, after the completion of the $4.0 million equity infusion led by Trinity Investment Partners on Nov. 10, is now better-positioned to reinvigorate our stores and increase our investment in consistent, results oriented marketing, Internet and innovative technology. We also plan to increase our service offerings and enhance our customers’ retail and installation experience with the company.”

Joseph Calabrese, CFO stated, “The decline in sales for the fourth quarter of fiscal 2006 was due to the reduction in retail store traffic, directly related to the decline in the company’s marketing efforts, increased competition and price compression of high definition flat panel televisions. Our comparable store sales decline was experienced in most stores, but in particular, at the company’s midtown Manhattan store, the Greenvale, Long Island store and our store within ABC Carpet and Home in lower Manhattan. We are currently addressing non-performing stores and anticipate improvement in the sales base with our operational and marketing initiatives for fiscal 2007.”