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Appliance Recycling Centers of America, Inc. (ARCA), a U.S. retailer of special-buy household appliances, reported net income of U.S. $41,000 or $0.01 per diluted share for the third quarter of 2003 ended Sept. 27, 2003. This included a charge of $288,000 related to a write-down of inventories related to the company's used appliance operations, which is a negligible portion of ARCA's current retail business that the company has decided not to expand. ARCA reported earnings of $274,000 or $0.09 per diluted share in the third quarter of 2002. Revenues in the third quarter of 2003 came to approximately $11.9 million compared to $13.1 million in the year-earlier period.
Same-store sales of the six ApplianceSmart factory outlets that were open during the complete third quarters of 2003 and 2002 rose 24 percent. For the quarter, total retail sales increased 15 percent, due partly to the consistently strong results of the Champlin, MN, U.S., outlet that opened in this year's first quarter. Third quarter retail sales also benefited from the improved performance of ApplianceSmart's Ohio, U.S. operations, which were restructured and strengthened earlier in the year. As a result of the Ohio restructuring, total Selling, General, and Administrative expenses fell 14 percent in the third quarter from the year-earlier level.
ARCA's third-quarter operating results continued to be affected by the anticipated decline in appliance recycling revenues. In last year's third quarter, recycling revenues were generated by two California energy conservation programs, while only one such program has operated in 2003. Appliance recycling revenues are expected to stabilize in this year's fourth quarter.
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