Indianapolis-based HHGregg Inc. on Wednesday reported a big increase in fiscal fourth-quarter earnings due largely to a $39.6 million payout from a life insurance policy the company took out on former executive chairman Jerry W. Throgmartin.
Throgmartin, who had a 36-year career with the the appliance and electronics retail chain, died in January after a sudden illness.
Including proceeds from the insurance policy, HHGregg earned $53.6 million, or $1.45 per share, for the three months ended March 31, up from $14.6 million, or 36 cents per share, in the year-ago period.
Excluding the payout and other adjustments, HHGregg earned $14.5 million, or 39 cents per share, a decrease of 2.5 percent compared with adjusted net income from the previous fiscal fourth quarter.
Revenue increased 21.1 percent, to $613.8 million, due in part to the opening of 35 stores within the past year.
Same-store sales, however, decreased 0.7 percent in the quarter. Sales at stores open at least a year are a key measure of a retailer’s health because they exclude stores that opened or closed during the year.
The dip in same-store sales was driven by a double-digit decline in the average selling price of flat-screen televisions.
Same-store sales in the video products category, which include televisions, fell 16.7 percent in the fiscal fourth-quarter.
“Our fourth quarter results were driven by solid market-share gains in the appliance and home-office categories, offset by continued headwinds in the video category,” company President and CEO Dennis May said in a prepared statement.
“Through the launch of a number of strategic initiatives earlier this year, we continue to strengthen our positioning in appliances, expand our assortments in home office products and build our mobile business," he said.
For the full fiscal year ended in March, HHGregg earned $81.4 million, or $2.14 per share, compared with $48.2 million, or $1.19 per share, in the previous fiscal year.
Revenue increased 20 percent, to $2.5 billion, while same-store sales for the entire fiscal year decreased 1.1 percent.
For fiscal 2013, HHGregg said it expects to earn between $1.12 and $1.27 per share and grow revenue by 9 percent to 12 percent. The company should open between 20 and 22 stores within the next fiscal year.
Same-store sales, though, aren’t expected to grow much, hovering between a 1-percent decrease and 1-percent increase.
HHGregg operates 208 stores in 16 states.
Company shares opened Wednesday morning at $9.77 each, down from a 52-week high of $16.45 in December.