RadioShack Corporation has announced preliminary net income for the first quarter ended March 31, 2009, of $43.1 million, or $0.34 per diluted share, compared with net income of $38.8 million, or $0.30 per diluted share, for the first quarter ended March 31, 2008.
Operating income for the first quarter increased 25 percent to $80.1 million, or 8.0 percent of sales, compared with $64.2 million, or 6.8 percent of sales, last year.
Total net sales and operating revenues were up 5.6 percent to $1,002.1 million compared with $949.0 million for the same period last year. Comparable same-store sales for company-operated stores and kiosks increased 5.0 percent during the first quarter compared with the first quarter of 2008.
Commenting on the financial results, RadioShack’s Chairman and Chief Executive Officer Julian Day said, “We are very pleased with the results we reported today. An eight percent operating margin is the strongest first quarter performance we have achieved since 2004. Of particular note were strong performances in our wireless business and digital converter boxes.”
RadioShack generated $86.1 million in net cash from operating activities during the first quarter ended March 31, 2009 compared with $7.4 million during the same period last year. Capital expenditures during the first three months of the year totaled $26.2 million and RadioShack is estimating capital expenditures for 2009 to be in the range of $75 million to $100 million.
“Our disciplined approach to working capital management has again resulted in further strengthening our balance sheet and we continue to believe that a strong balance sheet is important in trying economic times,” Day said.
Cash and cash equivalents as of March 31, 2009 were $873.2 million, an increase of $403.9 million compared with the first quarter of last year. Inventories of $575.8 million at the end of the first quarter of 2009 were $87.6 million lower than the first quarter of last year.
First Quarter Results
Net Sales and Operating Revenues
Total net sales and operating revenues in the first quarter of 2009 increased $53.1 million to $1,002.1 million compared with $949.0 million for the same period last year. The 5.6 percent increase was attributable to a 5.5 percent increase in the sales generated by U.S. company-operated stores; a 10.0 percent decrease in kiosk sales; and a 23.9 percent increase in other sales. The decrease in kiosk sales was primarily due to fewer Sprint kiosks, which was partially offset by an increase in the sales generated by Sam’s Club kiosks. Other sales were up for the quarter primarily due to the addition of sales generated by RadioShack de Mexico acquired in December 2008 and a 27.6 percent increase in online sales, which were partially offset by a 7.9 percent decline in dealer sales during the first quarter.
First quarter 2009 comparable same-store sales for company-operated stores and kiosks increased 5.0 percent compared with the first quarter of 2008. The increase was primarily attributable to the strong performance of digital converter boxes, postpaid wireless and flat-panel televisions, which was partially offset by a decline in GPS, wireless accessories, digital cameras and digital music players.
The first quarter of 2008 had one additional selling day compared with the first quarter of 2009. The Company is estimating that comparable same-store sales would have been 6.3 percent after adjusting for the additional day.
RadioShack sold over one million digital-to-analog television converter boxes during the quarter, which generated approximately $70 million in sales. The company is estimating that converter box sales negatively impacted the gross profit rate during the first quarter by approximately 1.3 percent.
via: Radio Shack
