Back to top

Analyst Blog

RadioShack Corp. (RSH - Analyst Report) posted weak third-quarter 2013 financial results. Notably, the comparable store sales for the company-operated stores and kiosks (stores and kiosks that have been operational for at least a year) were down 8.4% in the reported quarter. This is a key retail performance indicator measuring growth from the existing sales locations.

GAAP net loss from continuing operations in third-quarter 2013 was $112.4 million or a loss of $1.11 per share compared with a net loss of $47.1 million or a loss of 47 cents per share in the year-ago quarter. Reported loss per share was significantly higher than the Zacks Consensus Estimate of a loss per share of 37 cents. The total revenue was $805.4 million, down 10.3% year over year and also below the Zacks Consensus Estimate of $896 million.

Quarterly gross profit was $242.7 million versus $340.8 million in the prior-year quarter. Gross margin was 30.1% compared with 37.9% in the comparable year-ago quarter. Selling, general, and administrative expenses were $343.3 million against $354 million in the previous-year quarter. Operating loss was $118 million compared with $34 million in the year-ago quarter.

During the first nine months of 2013, RadioShack generated $175.6 million in cash from operations compared with $32.4 million in the year-ago period. Free cash flow, in the reported period, was $149 million against a negative $12.1 million in the prior-year period.

At the end of the third quarter of 2013, RadioShack had $316.4 million in cash & cash equivalent compared with $546.1 million at the end of third-quarter 2012. Total debt, at the end of the reported quarter, was $498.3 million versus $474 million at the end of the previous-year period. The debt-to-capitalization ratio was 0.56 compared with 0.42 at the end of the third quarter of 2012.

Segment Results

U.S. RadioShack Company-operated store segment, which is the prime contributor to the total revenue, was down 9.9% year over year to $733.9 million. Operating loss was $26.5 million, down 142.7% from the prior-year quarter. Other segment revenues decreased 14.5% year over year to $71.5 million. Operating income was $1.6 million, down 84.2% from the year-ago quarter.

RadioShack currently has a Zacks Rank #3 (Hold).

Other Stocks to Consider

Other stocks in the electronics retail industry worth a look are hhgregg Inc. (HGG - Analyst Report), Conns Inc. (CONN - Snapshot Report) and GameStop Corp. (GME - Analyst Report). Both, hhgregg Inc. and GameStop Corp. have a Zacks Rank #2 (Buy) while Conns Inc. has a Zacks Rank #3 (Hold).

Please login to Zacks.com or register to post a comment.