By Tess Stynes
HHGregg Inc. (HGG) projected fiscal third-quarter results below
expectations and cut its fiscal-year guidance as growth in
appliances, computing and mobile-phones sales was more than offset
by a slump in the video and other categories.
The appliance and electronics retailer's shares were down 6.1%
at $7.41 in recent premarket trading.
For the fiscal quarter ended Dec. 31, HHGregg forecast per-share
earnings of 52 cents on net sales of $799.6 million, while analysts
polled by Thomson Reuters most recently expected per-share earnings
of 59 cents and revenue of $845 million.
"Declining industry demand for flat-screen televisions along
with broadened distribution of large-screen televisions negatively
impacted overall store traffic and video-category sales," President
and Chief Executive Dennis May said. "Our appliance business, which
is now our largest product category, along with our computing and
mobile-phones category continue to perform well."
HHGregg also was pleased "with the consumer acceptance of our
new products, particularly the roll out of the furniture category
and the introduction" of Apple Inc. (AAPL) products, Mr. May
said.
However, Chief Financial Officer Jeremy Aguilar said the company
expects industrywide declines in the video category will continue
in the fiscal fourth quarter, contributing to HHGregg's lowered
fiscal-year outlook.
For the fiscal year, the company lowered its per-share earnings
estimate to 70 cents to 80 cents on net sales growth of up to 1%,
from its earlier estimate of 90 cents to $1.05 and net sales growth
of 3% to 6%. HHGregg now expects same-store sales to decline 7.5%
to 8.5%, compared with its earlier forecast for a drop of 4% to
6%.
HHGregg plans to release its fiscal third-quarter financial
report Jan. 31.
Write to Tess Stynes at Tess.Stynes@dowjones.com
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