The company's profit was positively impacted by a one-time, non-cash gain of $56.5 million or 39 cents per diluted share as a result of a reversed tax contingency reserve, according to executives who spokeduring RadioShack's earnings conference call.
Without the gain, RadioShack's profit would have been $52 million or 36 cents per share, missing Wall Street expectations of 37 cents per share on revenue of $1.15 billion, according to Thomson Financial. Shares of the company's stock reached a 30-month low of $22.40 during Friday's trading, ending the day at $22.95, a 2.9% decrease from the prior day.
During the third quarter, the company achieved total sales of $1.19 million, an increase of 8% compared to total sales of $1.1 million for the previous year. Comparable store sales for the quarter were up 1%versus the prior year.
RadioShack executives attribute the sales growth to a ramp up in the company's wireless business, particularly kiosks. Total wireless sales were up 15% during the quarter, while non-wireless sales were up 5% from personal electronics and services.
The chain is focusing on four key areas to improve earning and drive comp-store sales, according to RadioShack president and CEO David Edmondson. The areas are: merchandizing, improved store operations,better marketing and more selling channels.
Specifically, RadioShack is bulking up its inventory of satellite radio, digital imaging, MP3s and wireless items, Edmondson says. "These are hot categories that are very productive for RadioShack," he contends.
The next three months are critical to RadioShack's future performance, according to industry experts. In the next couple of weeks, RadioShack's new advertising campaign will debut. And, the company is in the midst of transitioning its wireless carrier from Verizon toCingular. Edmondson says that he expects the transition to be "as seamless as possible" and indicates that by January 1, 2006, the transition will be complete.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
