Same store sales at Hhgregg drop 10%

Hhgregg President and CEO Dennis May played the “pleased with significant progress on transformation efforts” card after the company reported abysmal sales for its fourth quarter ended March 31.

The retailer said same store sales decreased 10%. Net sales decreased 9.8% to $485.6 million. Revenue dropped 10% to $485.6 million. The company had a loss of $25.2 million, or 91 cents a share, wider than its prior-year quarter loss of $7.2 million, or 25 cents a share.

“Our fourth quarter results were challenging, however, I am pleased with the significant progress we have made on our transformational efforts,” said Dennis May, president and CEO. “Our top fiscal 2016 initiatives are centered on improving our cost structure through the optimization of our marketing dollars, the reduction of our operating expenses and more efficiently managing our working capital, along with reversing our negative sales trends.”

The retailer has grappled with lower demand for electronics for several quarters and begun a shift toward selling higher margin items, as well as increased advertising and slashed expenses.

“On the expense side, we have identified over $50 million of savings. These savings are inclusive of both marketing and operating expenses,” May added” “We plan to reduce and re-invest advertising dollars to more effective channels, further reducing our reliance on print media. Additionally, we have identified several areas throughout the company where we believe we can be more efficient with our spend. In addition to operating expenses, we will also be working to selectively rationalize our footprint and work to free up working capital through inventory optimization. From a top-line perspective, we will continue to expand our Fine Lines departments within the appliance category given the strong results we are seeing from our Fine Lines business, continue to focus on sales of larger screen 4K TV’s, and continue to refine our offerings within our other categories. We remain confident that through the combination of our savings and revenue initiatives, we will return to positive adjusted EBITDA in fiscal year 2016.”

HHgregg operates more than 200 stores in the United States.