Target Mobile centers give RadioShack sales boost
FORT WORTH, Texas — RadioShack reported a fourth-quarter sales increase, thanks to the rollout of Target Mobile centers, but profits were down.
Total net sales and operating revenues from continuing operations for the 2011 fourth quarter increased 5.9% to $1.39 billion, compared with $1.31 billion for the 2010 fourth quarter. Net income for the 2011 fourth quarter was $11.9 million, or 12 cents per diluted share, compared with net income of $57 million, or 51 cents per diluted share, for the fourth quarter ended Dec. 31, 2010.
Jim Gooch, president and CEO of RadioShack Corp., said, "The final results for our fourth quarter are in line with the preliminary range we issued in January. Despite our gross margin challenges, we have a strong balance sheet, are making progress in our mobility business, and expect to advance our business improvement initiatives in 2012."
The increase in total net sales and operating revenues for the 2011 fourth quarter was driven by a $93.4 million increase in other sales, reflecting the rollout of the company's Target Mobile centers to 1,496 locations by Dec. 31, 2011, compared to 850 locations at Dec. 31, 2010. This increase was partially offset by a $16.3 million decrease in sales generated by U.S. RadioShack company-operated stores.
Comparable-store sales for company-operated stores and Target Mobile centers increased 2.2% during the 2011 fourth quarter. The increase was primarily attributable to higher postpaid wireless sales of AT&T Wireless and Verizon Wireless products and services. Tablet devices also contributed to the increase in comparable-store sales. These increases were partially offset by a decline in Sprint and T-Mobile postpaid wireless sales, in addition to lower sales of digital cameras and digital music players.