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Guitar Center Rolls Out More Stores

WESTLAKE VILLAGE, CA-Guitar Center will add between 16 and 19 stores to its presence this year even as it has softer sales in the fourth quarter.

By Beverly Ford | Updated on February 27, 2007

WESTLAKE VILLAGE, CA-Musical instrument and equipment retailer Guitar Center Inc. rolled out 37 new stores during fiscal 2006 and will add 16 to 19 more this year as the company moves to improve its market share in an increasingly competitive business environment.

The expansion is expected to affect earnings growth in fiscal 2007, a company official said, but the results of those efforts should help per share earnings increase by 30% or more in 2008. For fiscal 2007, per share earnings are projected to range between $2.41 and $2.65.

Guitar Center, which operates 198 stores in 42 states, lost $40 million, or $1.36 per share in the quarter ended Dec. 31, 2006 as soft sales cut into profits. Last year, the Westlake Village, CA retailer showed a profit of $33.5 million, or $1.14 per share, during the fourth quarter. Revenue for the quarter increased 11.7% to $628.5 million from $562.8 million a year earlier.

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