Hhgregg profit up in Q2 as new stores help sales

Indianapolis Hhgregg said Thursday its second-quarter profit jumped 46% as the appliance and electronics retailer opened seven new stores and spent less on advertising.

For the quarter ended Sept. 30, the company earned $4.9 million, compared with $3.4 million in the year-earlier period.

Sales edged higher to $332.2 million from $320.3 million, better than the $324.5 million Wall Street expected.

The company said sales rose primarily from adding new stores, which offset a 9.4% decline in same-store sales.

Advertising expenses fell as the company benefited from lower advertising rates. It also had higher advertising expenses in the prior-year period due to the launch of new markets in Florida. That created an easier comparison to last year's results.

"We continue to expect sales trends to improve over the first and second-quarter performance," CEO Jeremy Aguilar said. "However, gross margins will see pressure due to the lapping of the industry's inventory oversupply in the video category that we saw in the prior year."