To all. Responsible for the drop this AM???
CompUSA hurt by low PC prices
By Margaret Kane, ZDNN
April 1, 1998 5:34 AM PST
Sub-$1,000 PCs may be popular with consumers, but their appeal has been dimmed at retail chain CompUSA Inc.
The Dallas company won't report official results for the third quarter until April 29, but it said today that net sales for the quarter rose 14 percent to $1.45 billion in the third fiscal quarter. Sales at stores that had been open for at least a year were up 1.2 percent.
But sales per superstore fell about 6 percent from a year ago. That, combined with investments, will hurt margins in the quarter. CompUSA (CPU) expects margins to be around 14.1 percent.
Investments in the company's new line of PCs, as well as expenses related to refinements of its direct sales business, have been higher than expected, and will lower earnings per share for the quarter by 3 or 4 cents. Those costs could effect results for the next few quarters.
"We are generally disappointed with our overall sales growth," CEO James F. Halpin, said in a release. "Despite increased unit volume in the third quarter, sales were impacted by greater than anticipated declines in average selling prices."
In the year ago quarter, the company earned $32.7 million, or 35 cents per share, on sales of $1.27 billion. CompUSA is expecting to see flat same store sales in the fourth fiscal quarter, which is typically slower than the third quarter. |
