Bad Debt And Costs Weigh On Conn's 2Q Profit

BEAUMONT, Texas (AP) — Retailer Conn's Inc. said Thursday its profit dropped 52 percent in the fiscal second quarter as it set aside more money for bad debt, and expenses rose.

Conn's has 75 stores in Texas, Louisiana, and Oklahoma, with about a third of its stores in the Houston area. It sells consumer electronics, appliances, furniture, and lawn and garden products.

The company said its profit decreased to $4.9 million, or 22 cents per share, from $10.2 million, or 45 cents per share. Revenue increased less than 1 percent, to $220.2 million from $218.5 million a year ago.

Analysts expected a greater profit of 33 cents per share, and $221.2 million in revenue, according to Thomson Reuters.

Conn's said its same-store sales, or sales at locations open at least a year, fell 5.2 percent in the three months ended July 31.

The company increased its provision for bad debts, or debts it does not expect to be paid back, to $2.7 million from $333,000 a year ago. Cost of goods sold edged up to $140.8 million from $136.8 million, and selling, general and administrative costs rose to $64.9 million from $62.9 million.

Conn's also lowered its profit forecast for the year, and its shares lost $1.46, or 11.1 percent, to $11.72.