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To: Johnny Canuck who wrote (39746)	6/17/2003 12:14:49 PM
From: Johnny Canuck	Read Replies (1) \| Respond to of 71489

Circuit City Posts Wider Loss, Sales Fall Tuesday June 17, 8:53 am ET NEW YORK (Reuters) - Circuit City Stores Inc. (NYSE:CC - News), the No. 2 U.S. electronics retailer, on Tuesday said its quarterly loss widened as sales fell, credit-card operations weakened and store remodeling costs rose. The company posted a loss of $43.9 million, or 21 cents a share, for the fiscal first quarter ended May 31, compared with a loss of $1.3 million, or 1 cent a share, a year earlier. On June 5, Circuit City, which ranks behind industry No. 1 Best Buy Co. Inc. (NYSE:BBY - News), forecast a loss of 23 cents to 25 cents a share. Analysts' average loss estimate was 24 cents, according to Thomson First Call (News - Websites). Circuit City, based in Richmond, Virginia, said first-quarter sales at stores open at least a year, or same-store sales, fell 10 percent. The company has been cutting prices on goods such as CDs, DVD players and television sets in a bid to boost sales, but so far the strategy has met with limited success. Circuit City, which is trying to make its stores more attractive to shoppers amid stiff competition from discount retailers such as Wal-Mart Stores Inc. (NYSE:WMT - News), said total sales in the latest quarter declined 9 percent from a year earlier, to $1.93 billion. The company's finance operation produced a pretax loss of $22.1 million, compared with a pretax profit of $20.4 million a year earlier. Circuit City said the business was hurt by adverse market conditions that forced it to keep more of a stake in securities backed by customer bill payments than it had wanted. "Given the recent performance of the bankcard operation, the board has authorized management to analyze all viable options for that operation," Circuit City said in a statement. On June 6 the company told Reuters a sale of its struggling credit card business would be one of the options considered. The company said store remodeling and relocation costs reduced first-quarter earnings by 5 cents a share. Circuit City, in a separate announcement, said Michael Foss will join the company as senior vice president and chief financial officer, replacing Michael Chalifoux, who announced plans to retire earlier this year. Circuit City's top rival, Best Buy, is scheduled to report quarterly results on Wednesday. Earlier this month Best Buy raised its earnings forecast and said sales increased 11 percent to $4.67 million.