DBSTalk Forum banner
Status
Not open for further replies.
1 - 1 of 1 Posts

·
Charter Gold Club Member
Joined
·
22,056 Posts
Discussion Starter · #1 ·
Drop in flat panel tv prices blamed

Circuit City Lowers 2007 Outlook

Sales at the national retailer are up but profits are down, according to Circuit City's third quarter report, announced Tuesday, leading the company to lower its fiscal expectations for 2007.

"The third quarter was volatile for the company," said Philip J. Schoonover, chairman, president and CEO. "While we are disappointed with our profit performance this quarter, we continue to see evidence that we are on the right long-term path to sustainable growth. We saw sales growth in the key pillars of home entertainment, multi-channel and services. These efforts allowed us to report solid comparable store sales growth despite facing a 13.1 percent comparison from last year."

For Circuit City, flat panel TVs were the problem. Despite strong sales this fall, heavy discounts and ongoing promotional programs eroded the retailer's profit margins and chipped away at their income numbers this quarter.

"A number of categories underperformed our gross margin expectations," Schoonover said. "The most significant variance from plan was in the flat panel television category. The pace of the decline in flat panel television prices accelerated during the quarter as manufacturers and retailers competed aggressively for market share, and prices fell to unanticipated levels. Although flat panel television unit sales increased by strong double digits, the increase in television units and associated attachment sales did not produce the gross profit dollar results necessary to offset these price declines."

www.SkyRetailer.com - used with permission
 
1 - 1 of 1 Posts
Status
Not open for further replies.
Top