Quarterly Figures Down for Big Retailers; Tweeter Adds Sound Advice
Richmond, VA–based Circuit City Stores, Inc. haven't had much to crow about so far this year. The company's comparable-store sales dropped 25% for the quarter ended May 31. A year ago, Circuit City pulled out of the major household appliance business and decided to devote the floor space to computers, a decision that may have proved an unwise move. With appliances subtracted from the calculations, comparable-store sales declined 13%.
RadioShack, the nation's largest electronics retailer, reported a 2% increase in comparable-store sales for May, and a 5% increase for the year to date, $1.74 billion so far in 2001 versus $1.67 billion last year. Total sales were off by less than 1% in May: $325.2 million this year, compared to $326 million in May 2000. Wireless phones are strong sellers for the Shack, the Fort Worth, TX–based company reports.
On June 6, California's Good Guys chain announced an 8% decline in same-store sales and predicted a moderate loss for the first quarter. The San Francisco–based upscale retailer hopes "to narrow its losses during the next two quarters" and show a profit for fiscal 2002. Good Guys' total sales for the quarter ended May 31 were $171.5 million, compared to $184.1 million during the same period a year ago. Like Best Buy, Good Guys reports that its strongest sales categories are digital cameras, camcorders, high-definition televisions, and digital satellite receiver systems.
Tweeter Home Entertainment Group, Inc., of Canton, MA has expanded its empire with the acquisition of Florida's Sound Advice stores, in a stock swap valued at about $150 million. Sound Advice reported sales of $198.4 million for the fiscal year ended January 31.
Subject to shareholder approval, the deal is expected to close around September 1. Tweeter's fiscal year ends September 30; last year the company reported earnings of $16.4 million on revenue of $404.7 million. According to a June 4 press release, Tweeter hopes the Sound Advice acquisition will increase its earnings by five to six cents per share for the fiscal year ending September 30, 2002. Tweeter Home Entertainment stock closed at $28.75 on the NASDAQ market Friday, June 8, a rise of 6.5%. Sound Advice shares were also up, by 9.1%, closing the same day at $15, from a closing price of $13.75 the previous day.