Continuing the performance re-bound that started in the second quarter last year, Ultimate Electronics reported its fourth straight quarter of profitability on higher sales.
For its first fiscal-2000 quarter ended April 30 the 30-store Denver-based chain posted a net of $439,000, against a year-earlier loss of $2.21 million. Sales, at $80.3 million, were up 13.3%. Comparable stores had a 14% revenue rise in overall sales, but excluding the effect of Ultimate’s reduction in its computer product offerings, same-store sales were up 20%.
The specialty retailer’s gross margin for the quarter was 29.3% of sales, up from the year-earlier 25.8%. That reflected a combination of increased sales of higher-margin A/V and mobile products this year, and the $700,000 in inventory reserves established last year to cover the planned disposition of excess computer products.
Cost-control measures and the strong same-store sales performance enabled Ultimate to reduce its overhead expense-to-sales ratio to 27.6% from last year’s 29.2%.
President Dave Workman said “sales in the key areas of DVD, camcorder, television, car audio and home audio remain extremely strong and, as additional digital products arrive this summer and fall, we expect these trends to continue.” Ultimate has been “very successful in selling DVD, digital satellite systems and HDTVs,” he said. “With the increased availability of high-definition broadcasts, we anticipate further acceptance of HDTV and other digital products.”