Conn’s takes comfort in furniture business

Strength in the furniture and mattress category during the fourth quarter wasn’t enough to help Conn’s avert same-store sales decline with each of the company’s other merchandise classifications reporting weakness.



Conn’s said its total sales for January increased 7.9% to $101 million and for the three months ended Jan. 31, sales increased 7.4% to $376.5 million. The gains were the result on news stores as same stores sales at the specialty retailer of furniture, mattresses, home appliances and consumer electronics declined 2.3%.



The strongest performance for the quarter was the furniture and mattress category which saw comps increase 15.2%. However, same-store sales in the consumer electronics, home office and appliance categories, declined 13.3%, 11.3% and 1.2%, respectively. A category described as “other” saw comps declined 17.8%.



"During the month of January, we continued to see solid performance from the strategic expansion of our furniture assortment,” Norm Miller, Conn's CEO and president. “Same store sales increased 12.3% in the furniture and mattress category, while home appliance sales trends recovered slightly. Excluding the impact of our decision to exit video game products, digital cameras, and certain tablets, same store sales increased 0.6% for January, 3.6% for the quarter, and 4% for the full fiscal year. Including all product categories, total fiscal year same-store sales were up 0.5%.”



A couple of variable unique to Conn’s had a bearing on the company’s performance. For example, January sales comparison in the consumer electronics category were negatively affected by the Super Bowl being played on Feb. 7 this year versus Feb. 1 last year. The timing cause sales of televisions to shift into the first week of February this year, which Conn’s expects to benefit February results.



Another drain on performance has been weakening economic conditions in areas dependent on the oil and gas industry. Excluding product categories the company is exiting, same store sales increased 0.9% in areas with exposure to the oil and gas industry versus a 5.1% increase in other markets.



Lastly, the company said its greater than 60 day delinquency rate was 9.9% during January compared to 9.7% the prior year.



Conn’s ended the year 100 stores in Arizona, Colorado, Georgia, Louisiana, Mississippi, Nevada, New Mexico, North Carolina, Oklahoma, South Carolina, Tennessee and Texas.