On Wednesday, April 4, electronics retailer Circuit City
- Total sales expanded a paltry 1.2% as same-store sales fell 0.5%. Management detailed that "flat-panel television average selling prices were well below the prior year, and our PC hardware business experienced volatility around the Microsoft Windows Vista operating system transition."
- Online sales grew 50% for the year, one of the bright spots in a disappointing earnings release.
- Diluted earnings dipped into negative territory thanks to a sizeable goodwill impairment charge, as well as store closure expenses.
- Management expects pre-tax losses to continue during the first half of fiscal 2008 but currently projects a "strong recovery in the second half" of the year.
- Circuit City carries a lowly one-star rating in the Motley Fool CAPS intelligence database, while archrival Best Buy
(NYSE:BBY) carries a higher three-star rating. Regional rival Rex Stores(NYSE:RSC) also carries a three-star rating. You can be the first to rate Tweeter(NASDAQ:TWTR) in CAPS.
(Figures in thousands, except per-share data)
Income Statement Highlights
|
Q4 2007 |
Q4 2006 |
Change |
|
|---|---|---|---|
|
Sales |
$3,933,659 |
$3,886,385 |
1.2% |
|
Net Profit |
($12,209) |
$141,365 |
N/A |
|
EPS |
($0.07) |
$0.81 |
N/A |
|
Diluted Shares |
169,478 |
175,516 |
(3.4%) |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q4 2007 |
Q4 2006 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
23.7% |
24.6% |
(0.9) |
|
Operating Margin |
0.2% |
5.9% |
(5.7) |
|
Net Margin |
(0.3%) |
3.6% |
(3.9) |
Margins are the earnings engine.
Balance Sheet Highlights
|
Assets |
Q4 2007 |
Q4 2006 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$739,482 |
$837,962 |
(11.8%) |
|
Accounts Rec. |
$371,055 |
$220,869 |
68.0% |
|
Inventory |
$1,636,507 |
$1,698,026 |
(3.6%) |
|
Liabilities |
Q4 2007 |
Q4 2006 |
Change |
|---|---|---|---|
|
Accounts Payable |
$922,205 |
$850,359 |
8.4% |
|
Long-Term Debt |
$50,487 |
$51,985 |
(2.9%) |
The balance sheet reflects the company's health.
Cash Flow Highlights
Fools will have to wait until Circuit City files its 10-K with the Securities and Exchange Commission for juicy cash flow details.
Free cash flow is a Fool's best friend.
Related Foolishness:
- So Which Stocks Should I Buy Now?
- Best Buy Bests Circuit City, Again
- 70 Times Better Than the Next Microsoft
Best Buy is a Motley Fool Stock Advisor recommendation.
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.
Fool contributor Ryan Fuhrmann has no financial interest in any company mentioned. Feel free to email him with feedback or to discuss any companies mentioned further. The Fool has an ironclad disclosure policy.
