hhgregg Reports Drop in Net Sales
hhgregg shares have been down around 20 percent in pre-market trading on the Bloomberg report.
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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowIndianapolis-based hhgregg Inc. (NYSE: HGG) has released preliminary fiscal third quarter net sales results. The company is reporting $453 million in net sales, a 24 percent decrease from the same period the previous year.
hggregg says comparable store sales decreased an estimated 22 percent, while the consumer electronics category dropped an estimated 39 percent. The company adds the numbers could see adjustments ahead of its full fiscal third quarter earnings report, which will be released January 26.
Chief Executive Officer Robert Riesbeck says the company was challenged by competitive pressures in the market during the holidays, specifically in consumer electronics. He says the company’s transition to a new distribution center also had a temporary negative impact on sales.
"Although we are disappointed with our overall performance during the quarter, we are pleased with our investments made to shift our focus from consumer electronics to appliances and furniture, through resetting store layouts, adding Fine Lines departments and promotions focused on our appliance business," said Riesbeck. "The consumer electronics category was very competitive again this holiday season. We made the strategic decision to compete less in this category, particularly at the entry level price points."
Riesbeck says, going forward, hhgregg will continue its focus on appliance and home products while repositioning its consumer electronics business to have more of a focus on premium models. The preliminary results show continued loss for the company, which in November reported a loss of $18.4 million during the fiscal second quarter.