Rent-A-Center Earnings Double

But shares slip as guidance disappoints.
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Rent-A-Center

(RCII) - Get Report

, a rent-to-own operator, said its third-quarter earnings more than doubled as same-store sales rose and operating costs declined.

The company earned $25.2 million, or 36 cents a share, in the quarter, compared with $11.3 million, or 15 cents a share, a year ago. The third quarter results include the 2 cents a share effect of refinancing expenses and the 13 cents a share for litigation expenses. Adjusted for items, the company earned 51 cents a share. Analysts surveyed by Thomson First Call were expecting earnings of 48 cents a share in the most recent quarter.

Third-quarter revenue rose 2.4% from a year ago to $587.2 million as against analysts' expectation of $585.9 million.

The Plano, Texas-based company said the rise in revenue was primarily driven by a 3.6% rise in same-store sales plus an increase in incremental revenues generated in new and acquired stores, offset by the revenue lost from stores that were closed or sold during the previous twelve months.

For the fourth quarter, the company expects to earn 46 cents to 50 cents a share, on revenue of $586 million to $594 million, as against analysts' expectations of 53 cents a share, on a revenue of $600.8 million.

For the year 2007 the company expects to earn $2.24 a share to $2.32 a share on revenue of $2.42 billion to $2.45 billion. Analysts were expecting earnings of $2.39 a share, on revenue of $2.51 billion for the full year 2007.

Shares fell 78 cents to $29.44.

This story was created through a joint venture between TheStreet.com and IRIS.