Conn's, Inc. Reports Net Sales for the Quarter Ended July 31, 2012
Net sales were
The retail gross margin, which includes gross profit from both product
and repair service agreement sales, was approximately 33.5% for the
|2012||% of Total||2011||% of Total||
|(dollars in thousands)|
|Furniture and mattress||31,942||18.6||%||21,361||14.1||%||10,581||49.5||%||57.5||%|
|Total product sales||156,024||90.9||%||138,231||91.0||%||17,793||12.9||%||20.0||%|
|Total net sales||$||171,652||100.0||%||$||151,987||100.0||%||$||19,665||12.9||%||21.5||%|
The following provides a summary of items influencing the Company's major product categories during the quarter, compared to the same quarter in the prior fiscal year:
- Home appliance sales increased during the quarter reflecting a 25.0% increase in the average selling price, partially offset by a 19.1% decrease in unit volume. Approximately one-third of the unit sales decline was attributable to the previous store closures. On a same store basis, laundry sales increased 15.4%, refrigeration sales increased 7.5% and cooking sales increased 17.4%. Milder temperatures drove a 18.9% decrease in room air conditioner sales;
The continued growth in furniture and mattress sales was driven by
enhanced presentation, product selection and increased promotional
activity. The reported increase was tempered by the impact of previous
- Furniture same store sales growth was driven by a 36.5% increase in unit sales together with a 19.3% increase in the average sales price.
- Mattress same store sales also increased reflecting a favorable shift in product mix from the Company's decision to discontinue offering low price-point products. As a result, on a same store basis, the average mattress selling price rose 78.5% and was partially offset by an 18.8% decline in unit volume;
- Consumer electronic sales decreased modestly due to the previous store closures. On a same store basis, sales rose 4.6% with growth in televisions, home theater and audio sales partially offset by a reduction in gaming hardware and accessory item sales. With the Company's decision beginning late last year not to compete for low-priced, low-margin television sales, the same store average selling price for televisions increased 32.1%, while unit sales declined 20.5%; and
- Home office sales growth was driven by the expansion of tablet sales, as well as a 26.8% increase in the average selling price of computers. The reported increase was partially offset by the impact of store closures, a reduction in computer unit volume and lower sales of accessory items.
All of the above amounts are preliminary estimates and are subject to change upon completion of the Company's quarterly financial statement closing process. Actual results may differ significantly from the preliminary estimates.
The Company will host a conference call and audio webcast on Wednesday,
September 5, 2012, at
The Company will also be presenting at the 32nd Annual
About Conn's, Inc.
The Company is a specialty retailer currently operating 65 retail
- Home appliance, including refrigerators, freezers, washers, dryers, dishwashers, ranges and room air conditioners;
- Furniture and mattress, including furniture for the living room, dining room, bedroom and related accessories and mattresses;
- Consumer electronic, including LCD, LED, 3-D, plasma and DLP televisions, camcorders, digital cameras, Blu-ray players, video game equipment, portable audio and home theater products; and
- Home office, including desktop and notebook computers, tablets, printers and computer accessories.
Additionally, the Company offers a variety of products on a seasonal basis, including lawn and garden equipment, and continues to introduce additional product categories for the home to help respond to its customers' product needs and to increase same store sales. Unlike many of its competitors, the Company provides flexible in-house credit options for its customers, in addition to third-party financing programs and third-party rent-to-own payment plans. In the last three years, the Company financed, on average, approximately 61%, including down payments, of its retail sales under its in-house financing plan.
This press release contains forward-looking statements that involve
risks and uncertainties. Such forward-looking statements include
information concerning our future financial performance, business
strategy, plans, goals and objectives. Statements containing the
words "anticipate," "believe," "could," "estimate," "expect," "intend,"
"may," "plan," "project," "should," or the negative of such terms or
other similar expressions are generally forward-looking in nature and
not historical facts. Although we believe that the expectations,
opinions, projections, and comments reflected in these forward-looking
statements are reasonable, we can give no assurance that such statements
will prove to be correct. A wide variety of potential risks,
uncertainties, and other factors could materially affect our ability to
achieve the results either expressed or implied by our forward-looking
statements including, but not limited to: general economic conditions
impacting our customers or potential customers; our ability to continue
existing or offer new customer financing programs; the success of our
planned opening of new stores and the update of existing stores;
technological and market developments, and sales trends for our major
product offerings; our ability to fund our operations, capital
expenditures, debt repayment and expansion from cash flows from
operations, borrowings from our revolving credit facility, and proceeds
from accessing debt or equity markets; and the other risks detailed from
time-to-time in our
Chief Financial Officer
Source: Conn's, Inc.
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