by Same-store sales decreased 15% during the quarter ended Oct. 31
THE WOODLANDS, Texas — Retailer Conn’s Inc. reported a 12.8% drop in consolidated sales and a 15% drop in same-store sales for the third fiscal 2024 quarter ended Oct. 31.
The company said total consolidated revenues totaled $280.1 million, a 12.8% decrease from the same period last year.
Its total net sales in the retail channel totaled $220.9 million, compared to $254.4 million, the same period last year, a 13.2% decrease. The company said this was largely driven by a 15% decrease in same-store sales related to lower discretionary spending for home-related products, including furniture, home appliances and home office products, three core categories. The decrease in same-store sales was partially offset by new store growth, the company said.
During the quarter, the company also reported an operating loss of $24.8 million in the retail segment, compared to a loss of $17.7 million the same period last year. The company said this was primarily due to a decrease in revenue and higher selling, general and administrative costs. It was partially offset by an improvement in retail gross margin of 33.5%, which was an increase of 30 basis points from 33.2% from the same period last year.
The segment’s SG&A costs for the quarter totaled $97.2 million compared to $94.2 million for the same period last year. The company said the increase was primarily due to an increase in occupancy from new stores, partially offset by a decline in variable costs and a decline in labor costs resulting from cost savings initiatives.
In the credit segment, the company reported revenues of $61.5 million during the quarter, down 7.7% from the $66.6 million in the same period last year. This, the company noted, was due to a 5% decrease in the average outstanding balance of the customer accounts receivable portfolio and a decline in insurance commissions. The operating loss in the credit segment was $13.4 million, compared to $300,000 the same period last year. The company said this change was primarily due to the increase in the provision for bad debts and the decrease in credit revenues.
Other highlights from the report were as follows:
+ The company reported e-commerce sales of $26.3 million, up 51% compared to the $17.4 million reported the same time last year.
+ It reported an overall net loss of $2.11 per share compared to a net loss of $1.04 per share the same period last year.
+ Credit applications rose 40.6% year over year. This was the highest growth rate in the past five years, the company said.
+ As of Oct. 31, the company had $144.2 million of available borrowing capacity under its $650 million revolving credit facility.
+ The retailer opened one new standalone store during the quarter, bringing its total to 176 locations in 15 states. During the entire fiscal year, it has opened eight standalone stores and expects to open one more store in the remainder of the 2024 fiscal year.
“We remain focused on pursuing strategic priorities aimed at turning around our retail performance and better serving our core credit constrained customers, said President and CEO Norm Miller. “I am pleased with the progress we made during the third quarter as we experienced strong year-over-year growth in credit applications and e-commerce sales. Despite the progress we are making, our third-quarter performance continued to reflect persistent industry headwinds and challenging economic conditions.”
