Circuit City Comps Fall

Fourth-quarter same-store sales fell 1.8% from a year ago.
By TSC Staff ,

Electronics retailer

Circuit City

(CC) - Get Report

said same-store sales fell 1.8% in the fourth quarter, although the number reflects a new methodology in which service revenue is now included in the tally. Under the company's old accounting, same-store sales fell 2.9% from a year ago.

Same-store sales were hurt by business model changes that cut wireless and video service sales in the latest quarter, the company said.

The company, which is the subject of a $3.2 billion leveraged buyout offer from a Boston hedge fund, said overall February quarter revenue was $3.47 billion, up 5.3% from a year ago. Analysts surveyed by Thomson First Call had been forecasting revenue of $3.36 billion in the quarter.

Circuit City's overall sales number also included a reclassification. The company said certain revenue, costs and expenses from mobile audio installation were moved up to the top line after previously being recorded as an offset to selling, general and administrative expense.

"We believe that the improving trend in sales since December reflects early improvements in our promotional and advertising effectiveness that translated into increased consumer traffic as the quarter progressed," the company said.

"We continue to take steps to move our business forward and are beginning to see initial results from the recent changes we have implemented. I want to thank our Associates who have worked hard to serve the customer better and improve store execution."

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