hhgregg 1Q Net Sales Were 49% Appliances
Jul 11, 2012
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Indianapolis-based appliance and electronics retailer hhgregg continued its focus on gaining appliance retail market share in the United States, even as its video category diminishes.

hhgregg preliminary net sales for its fiscal first quarter were approximately $490 million, up about 13.5% from $431.5 million in the fiscal first quarter of the previous year. The net sales increase came mostly from the opening of 30 new stores.

The first quarter of the retailer's fiscal 2013 year ended June 30, 2012.

The retail expects a fiscal first quarter net loss between $6.2 million - $5.7 million. In the year-ago first quarter it had a net loss of $0.8 million.

Appliances made up 49% of the retailer's net sales in the three months ended June 30, 2012, up from 44% in the three months ended June 30, 2011.

Video accounted for 33% in the quarter ended June 30, 2012, down from 37% in the quarter ended June 30, 2011.

The retailer's other two major product categories are:
* Home Office (primarily computers, mobile phones, and tablet computers) up to 8% from the previous year's 7%
* Other (primarily audio, furniture and accessories, mattresses and personal electronics) at 10% from the previous year's 12%

Hhgregg now expects fiscal 2013 comparable store sales of -6% to -4%. Previous guidance was -1% to +1%. It now expects a fiscal 2013 net sales increase of 3% -6%. Previous guidance was 9% - 12%. It expects to open 20-22 new stores in the fiscal year.

Chief Financial Officer Jeremy Aguilar said the company was being hurt by video industry headwinds and will realign its video business to address that.

President and CEO Dennis May saw difficulty in the current retail environment but said first quarter sales results were more specifically the result of "embedded volatility in the video industry."

While disappointed in video, "We continue to make progress on our key initiatives... (including) gaining market share in the appliances category," May said. He added that, "While big box consumer products today are defined as appliances and large screen televisions, we continue our plans to test new products that will help fill the void from sales declines in the video category."

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