The Woodlands, Texas-based retailer reported that its consolidated revenue declined 20.8% to $321.2 million in the three months ended Oct. 31, due to a 24.0% decline in total net sales and a 5.7% slip in finance charges and other revenues while same store sales dipped 27.0%.
For the quarter, Conn’s reported a net loss of $24.84 million, compared with net income of $18.24 million in the same period in 2021. It reported a $1.04 loss per diluted share in the quarter compared with a 60 cents per share gain in 2021.
“Retail sales remain challenged by macroeconomic headwinds, which continues to impact discretionary spending, and lower year-over-year lease-to-own sales,” said Norm Miller, Conn’s interim president and CEO. “As we navigate this environment, we are refocusing our efforts to better serve our core credit constrained customers. Conn’s differentiated credit offerings power a compelling model that we believe is needed now more than ever as consumers across the country are impacted by high inflation and growing economic uncertainty.”
Through the first nine months of 2022, Conn’s is reporting total revenues at $1.008 billion, down 15.15% from $1.188 billion through the same timeframe in 2021. It reported a $16.489 million loss and a loss of 68 cents per diluted share through the first three quarters of 2022 compared with net income of $100.641 million and earnings of $3.34 per diluted share in 2021.
Miller said Conn’s will tighten the belt as needed and will lean into the retailer’s core strengths to reverse these recent trends.
“We aim to improve our financial performance by taking a disciplined approach to growth and profitability. This includes prudently controlling costs and capital expenditures, while pursuing investments that contribute to earnings,” he said. “In addition, I am committed to execute against the company’s existing strategic priorities. These include strengthening our core retail business by expanding our assortment and testing partnerships; leveraging our credit business, including through the launch of an in-house lease-to-own offering; and accelerating e-commerce growth as we become a unified commerce retailer.
“Conn’s continues to have a unique value proposition, solid foundation and compelling future,” Miller added. “With a strong and committed leadership team focused on execution, I am confident we can turn around our financial and operating results.”
Conn’s opened two new standalone stores during the third quarter, bringing the total store count to 165 in 15 states and opened 15 store-within-a-store locations with Belk, which brings the total number of store-within-a-store locations to 19. During fiscal year 2023, it plans to open a total of 11 standalone locations.