Indianapolis – hhgregg
reported a net loss of $5.7 million for the quarter, compared with an $800,000
loss in the prior year’s opening quarter, with sales of video products continuing
to be a major problem for the company.
The increase in
the net loss was the result of a comp-store sales decrease of 5.1 percent. Overall
sales rose 13.5 percent for the quarter to $489.9 million.
The report was in
line with the retailer’s
of fiscal first-quarter results on July 16.
Dennis May, president/CEO,
said in a statement, “Our first fiscal quarter proved to be more challenging
than anticipated with sales and earnings coming in below our original
expectations. We reacted to the sales shortfall by making adjustments to our
cost structure. We expect subsequent quarters to benefit from our cost-cutting
for video in the quarter were down 16.7 percent, with appliances up 6.3
percent; computing and mobile phones up 8.7 percent; and the “other” category
of audio, furniture, accessories and personal electronics down 19.7 percent.
The video category
comp-store sales decline was driven by a double-digit decrease in unit demand
and a low single-digit decrease in average selling prices. The decrease in
comp-store sales for the “other” category was primarily a result of
double-digit comp-store sales decreases in cameras, camcorders and small
electronics, partially offset by growth in the mattress category, the chain
category saw an increase in average selling prices, with unit demand relatively
flat compared with the prior year three-month period. The computing and mobile
phones category was led by increased demand in the offering of tablet computers
and mobile phones, partially offset by declines in notebook computers.
Jeremy Aguilar, chief
financial officer, commented, “Though our industries have been challenged over
the past several years, we have consistently maintained a solid liquidity
position, with no long-term debt. Despite a volatile sales environment, we have
been able to manage our inventory very well and are pleased with our current
inventory levels. We continue to remain focused on driving long term
shareholder value while maintaining a strong liquidity position.”