On Feb. 27, all-American electronics retailer RadioShack
- Sales fell significantly year over year, on 7.7% lower comps and 10.2% fewer stores. But through the magic of operational efficiency, RadioShack generated a massive earnings boost. It's a combination of heads rolling in the corporate HQ, more efficient labor scheduling in the stores, and less advertising.
- The balance sheet looks good in all the right places, except for accounts payable. The company's inability to postpone its payments offset some very good inventory management moves, resulting in a weaker cash conversion cycle.
- RadioShack is currently a pitiful one-star Motley Fool CAPS stock. Some of our players think it's trying too hard to mimic Best Buy
(NYSE:BBY) and Circuit City(NYSE:CC) . Is this the start of a serious turnaround, or just one step forward and two steps back? Log in to CAPS today and let us know what you think.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Q4 2006 |
Q4 2005 |
Change |
|
|---|---|---|---|
|
Sales |
$1,458.1 |
$1,671.9 |
(12.8%) |
|
Net Profit |
$84.5 |
$51.2 |
65.0% |
|
EPS |
$0.62 |
$0.38 |
63.2% |
|
Diluted Shares |
136.5 |
135.7 |
0.6% |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q4 2006 |
Q4 2005 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
45.6% |
44.8% |
0.8 |
|
Operating Margin |
10.0% |
4.9% |
5.1 |
|
Net Margin |
5.8% |
3.1% |
2.7 |
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
|
Assets |
Q4 2006 |
Q4 2005 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$472.0 |
$224.0 |
110.7% |
|
Accounts Rec. |
$247.9 |
$309.4 |
(19.9%) |
|
Inventory |
$752.1 |
$964.9 |
(22.1%) |
|
Liabilities |
Q4 2006 |
Q4 2005 |
Change |
|---|---|---|---|
|
Accounts Payable |
$254.5 |
$490.9 |
(48.2%) |
|
Long-Term Debt |
$540.7 |
$535.8 |
1.0% |
Learn the ways of the balance sheet.
Cash Flow Highlights
|
YTD 2006 |
YTD 2005 |
Change |
|
|---|---|---|---|
|
Cash From Ops. |
$314.8 |
$362.9 |
(13.3%) |
|
Capital Expenditures |
$91.0 |
$170.7 |
(46.7) |
|
Free Cash Flow |
$223.8 |
$192.2 |
16.4 |
Find out why Fools always follow the money.
Related Foolishness:
- RadioShack's Leaky Roof
- RadioShack Recharges Its Batteries
- RadioShack's Email Mastery
- Foolish Fundamentals: Margins
Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.
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At the time of publication, Anders Bylund had no position in any company mentioned. Fool rules are here .
