Conn’s is planning tomake investments in technology, credit and personnel in 2016 as the retailer looks to expand its footprint with some 10 to 15 new stores and improve profitability.
For the fourth quarter ended Jan. 31 the retailer said revenues increased 7% to $456.8 million. Same store sales decreased 1.7%. Conn's said its credit segment operating loss increased from $11.3 million to $19.3 million, driven primarily by bad debts.
"We remain confident in our market opportunity, our business model, and the value we provide our customers,"saidNorm Miller, Conn's CEO and president. "Going forward, we are making strategic enhancements in our business to digest the rapid growth we have experienced and improve our infrastructure to produce consistent and predictable earnings growth. During fiscal 2017 we will make investments in IT, credit, and personnel to support our long-term goal of becoming a national retailer, while moderating our revenue growth plan to ensure a high level of execution.
Conn's said the percentage of customers more than 60 days delinquent in the fourth quarter increased to 9.9% as of Jan. 31, compared to 9.7% as of Jan. 31, 2015.Diluted earnings for the quarter was 3 cents per share compared to diluted earnings for the prior year quarter of 42 cents per share.
Miller added: "We continue to manage our underwriting model to maintain an appropriate balance between retail growth and credit risk. During the first quarter of fiscal 2017, we are making additional adjustments to reduce credit risk related primarily to new customers, while enhancing our ability to identify opportunities to increase originations to certain existing customers. We expect a moderate effect on sales as a result of these changes as well as those we implemented during the fourth quarter."
Conn's also announced some changes to its board of directors. Norm Miller, the company's president and CEO, has been named to succeed Theodore M. Wright as chairman of the board, effective in May.