Monday, January 7, 2008

Circuit City Dec. Sales Fall

Schoonover said the company will pay attention to giving sales associates the "necessary knowledge and tools needed to improve both sales and margin." The company had laid off 3,400 high-paid workers and replaced them with lower-paid new hires in March.

Attention also will be paid to expanding sales of Firedog, the company's PC services and home-installation business, Schoonover said.

The company said comparable domestic sales decreased for televisions, camcorders, DVD hardware and digital imaging products. It saw the most strength in video games and in navigation devices.

Same-store sales, or sales at stores open at least a year, is a key indicator of retailer performance since it measures growth at existing stores rather than from newly opened ones.

Shares were unchanged at $4.21 in after-hours trading.

For the month, the company said significant sales decreases in tube and projection televisions more than offset high single-digit! sales growth in flat-screen televisions. Sales of camcorders and DVD hardware fell by double digits.

Revenue from Firedog increased 15 percent, Circuit City said. Sales of extended warranties were $36.1 million, compared with $52 million in the same period last year.

Domestically, Internet and call center sales grew 17 percent in December, the company said.

Last month, Circuit City reported a wider-than-expected loss for the third quarter, driven by lower extended warranty sales and restructuring costs. Circuit City had also said it has received a commitment to more than double its $500 million credit line to $1.3 billion.

For the three months ended Nov. 30, Circuit City's losses ballooned to $207.3 million, or $1.26 per share, from $20.4 million, or 12 cents per share, a year ago. Excluding tax-related accounting items, losses totaled 64 cents per share in the latest period.

Sales slipped 3 percent to $2.96 billion from $3.06 billio! n a year earlier, with sales at stores open at least a year fa! lling 5. 6 percent.

"Our efforts to turn around the business have led to greater disruption than we anticipated, but we continue to believe that we are on the right path to return to sustainable, profitable growth and increasing shareholder value," Schoonover said in Monday's news release.

Circuit City announced last month that it approved millions in cash incentives to retain its top talent following the departure of several key executives over the past year. Executive vice presidents could claim retention awards of $1 million each and senior vice presidents could get $600,000, provided they stay with the company until 2011, according to a filing with the U.S. Securities and Exchange Commission.

Rival Best Buy Co. is scheduled to release its December sales figures on Friday.

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Source: http://www.dailypress.com/business/sns-ap-circuit-city-sales,0,6632095.story
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