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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowHHGregg Inc. on Monday morning announced preliminary sales figures for its latest quarter that fall well short of what the company recorded a year ago.
The Indianapolis-based electronics and appliance retailer said it had net sales of $707.1 million in its fiscal third quarter ended Dec. 31. That's an 11.6-percent decrease from the same quarter in 2012.
HHGregg shares sank more than 8 percent shortly after the market opened Monday, to $12.45 per share, after closing at $13.60 Friday.
Same-store sales, which exclude sales at stores open less than a year, are expected to have declined 11.2 percent, the company said.
HHGregg CEO Dennis May said the quarter was expected to be "solidly profitable," but would be "materially below both our expectations and prior year for diluted earnings per share, driven by the net sales miss."
May attributed the disappointing sales figures to the company’s decision to avoid offering products at severely deep discounts.
“Our holiday sales were significantly impacted by increased promotional offerings of televisions and tablet products across a variety of retail formats,” he said. “While we are disappointed with these sales results, we made the strategic decision during the quarter not to fully participate in the heavily promotional environment.”
Company sales of computers and wireless products are expected to have fallen 24.5 percent with television sales falling nearly 20 percent, HHGregg said.
On a brighter note, sales of home products are expected to have increased 36.1 percent and appliances 1.5 percent.
The company said it chose to lessen its reliance on the ultra-competitive consumer electronics category by introducing home products.
“The heightened promotional nature of the consumer electronics category during the quarter reinforces our decision to continue to transform our business towards a broader assortment of home products, including appliances and home furnishings,” May said.
HHGregg is set to report its official third-quarter earnings report Jan. 30.
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