Welcome!

Wearables Authors: JP Morgenthal, Elizabeth White, Carmen Gonzalez, Kevin Benedict, Cloud Best Practices Network

News Feed Item

RadioShack Reports Financial Results for Third Quarter 2013

Concept Store Initiative to be Rolled Out More Broadly in Coming Months

FORT WORTH, Texas, Oct. 22, 2013 /PRNewswire/ -- RadioShack Corporation (NYSE: RSH) today reported results for the third quarter ended September 30, 2013, including total net sales and operating revenues of $805 million and net loss of $112 million. The Company also announced that it has received commitments for $835 million of a new five-year debt financing. The Company continues to address significant legacy issues as it engineers a comprehensive operational turnaround driven by the Company's five pillars: reposition the brand, revamp the product assortment, reinvigorate the store experience, operational efficiency and financial flexibility.

(Logo: http://photos.prnewswire.com/prnh/20130716/LA47690LOGO)

Joseph C. Magnacca, chief executive officer, said, "We are moving forward quickly and as planned with our turnaround efforts. As we have said, we expect our work to take several quarters and during that time our results will vary quarter to quarter as we make strategic changes to improve our long-term financial performance. This quarter reflects our strategic decision to accelerate the improvements to the product assortment in our stores by removing duplicate and unproductive inventory. The lower inventory valuations for these products and projected disposal costs resulted in an expected increase to our cost of products sold this quarter."

Mr. Magnacca continued: "We have an aggressive plan to reinvigorate our store experience this fall in nearly all of our stores. This plan builds upon the sales improvement we've seen in three concept stores and two brand statement stores. By the end of the year, we will have over 100 concept and brand statement stores open. In addition, we are currently contemporizing our stores by significantly re-merchandising inventory in a more logical manner and improving presentation. Our entire store base of nearly 4,300 stores will see improvements from these changes which are being implemented in the early part of the fourth quarter."

"We are pleased with the recently obtained commitments for new financing. We are on track to achieve the Company's previously stated objective to supplement liquidity and enhance financial flexibility for the continued execution of our operational turnaround."

Note: All comparisons are versus the same period of the prior fiscal year unless otherwise noted.

"We strongly believe our new retail and consumer-centric strategy has us heading in the right direction. We've made significant progress in the third quarter and will continue to focus on execution during the all-important holiday selling season," Mr. Magnacca concluded.

THIRD QUARTER SUMMARY

  • Total net sales and operating revenues were $805 million, compared to $898 million last year. The decline was driven by an 8.4% decrease in comparable store sales due to reduced sales for each of the Company's product platforms. The Company continued to see increased sales of prepaid mobile phones in the mobility platform and in certain signature categories including portable speakers, Apple Lightning compatible cables and adaptors during the period.
  • Gross profit was $243 million, compared with $341 million last year. Gross margin was 30.1% of net sales, compared to 38.0% last year. Gross profit and gross margin performance were negatively impacted by approximately $47 million as a result of the Company's decision to accelerate the merchandise assortment changes by removing duplicate and unproductive products. Additionally, gross profit was negatively impacted by lower sales and decreased gross profit in the postpaid wireless business.
  • Selling, general and administrative (SG&A) expenses were $343 million, or 42.6% of net sales, compared with $354 million last year. The decrease was driven by fewer stores in operation and lower severance costs versus last year.
  • Operating loss was $118 million, compared to a $34 million loss last year.
  • Net loss was $112 million, or $1.11 per diluted share, compared to net loss of $47 million last year.
  • The Company continues to have a strong balance sheet and total liquidity of $613 million as of September 30, 2013.

CASH, LIQUIDITY AND CAPITAL SPENDING

The Company ended the third quarter with total liquidity of $613 million, including cash and cash equivalents of $316.4 million and $296.2 million of available credit under the asset-based revolving credit facility that expires in January 2016.

The Company's total debt was $499 million at September 30, 2013. On August 1, 2013, the Company repaid the $214 million remaining aggregate principal balance of the 2013 Convertible Notes at maturity. The balance of the Company's debt matures between 2016 and 2019.

Capital spending totaled $14.9 million in the third quarter compared to $16.8 million last year.

Subsequent to the end of the quarter, the Company obtained financing commitments from a consortium of lenders led by GE Capital, Corporate Finance; CIT Corporate Finance; RBS Citizens, N.A.; and Salus Capital Partners. These commitments total $835 million including a new $585 million senior secured ABL credit facility and a new $250 million secured term loan. The new debt facilities will be used to refinance the Company's existing $450 million ABL credit facility, $75 million of term loans and $100 million second lien term loan. The Company expects the new financings will provide approximately $175 million of incremental liquidity. The Company expects the new debt facilities will be closed in the fourth quarter. The new financings are subject to customary closing conditions.

CONFERENCE CALL

RadioShack will host a live webcast of its investor conference call at 9 a.m. EDT today. The Internet broadcast may be accessed from the investor relations home page of the RadioShack corporate website at http://IR.RadioShackCorporation.com.

An archived replay of the conference call will be available in the investor relations section of the corporate website, radioshackcorporation.com. A telephone replay will be available beginning at approximately 11 a.m. EDT today and will remain available until midnight EDT on November 5, 2013. The telephone replay can be accessed by calling toll-free at (888) 286-8010, or via toll call at (617) 801-6888. The replay pass code is 68578415.

For more information about performance, refer to the RadioShack Corporation Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on October 22, 2013.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements, as referenced in the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect management's current views and projections regarding economic conditions, the retail industry environment and Company performance. These statements can be identified by the fact that they include words like "anticipate," "believe," "estimate," "expect," "intend," "project," "guidance," "plan," "outlook" and other words with similar meaning. We specifically disclaim any duty to update any of the information set forth in this press release, including any forward-looking statements. These statements involve a number of risks and uncertainties that could cause our actual results to differ materially from the results discussed in our forward-looking statements. Factors that could cause our actual results to differ materially from the results discussed in our forward-looking statements include, but are not limited to, our ability to execute and the effectiveness of our 2013 initiatives; our ability to complete the new debt financings on the terms contemplated by the commitments in the fourth quarter of 2013 or at all; the underperformance or loss of certain of our important vendors, such as our wireless carrier providers, or breaches by them of our agreements with them; difficulties associated with our transition to an outsourced arrangement for the production of products we previously manufactured at our Chinese manufacturing plant; an adverse impact on our sales or profitability due to our transition to such an outsourced arrangement; an adverse impact on our sales or profitability due to changes wireless carrier providers make to their customer credit requirements, frequency of upgrade eligibility, or other operational matters, and the timing, completeness, and accuracy of information we receive about such changes; a decline in our gross margin due to customer demand for lower margin mobile devices, such as smartphones and tablets; overall sales performance; economic conditions; product demand; expense levels; competitive activity; interest rates; changes in the Company's financial condition; availability of products and services and other risks associated with the Company's vendors and service providers; the regulatory environment; and other factors affecting the retail category in general. Additional information regarding these and other factors is included in the Company's filings with the SEC, including its most recent Annual Report on Form 10-K for the year ended Dec. 31, 2012.

ABOUT RADIOSHACK CORPORATION

RadioShack (NYSE: RSH) is a leading national retailer of innovative mobile technology products and services, as well as products related to personal and home technology and power supply needs. RadioShack® offers consumers a targeted assortment of wireless phones and other electronic products and services from leading national brands, exclusive private brands and major wireless carriers, all within a comfortable and convenient shopping environment. RadioShack employs approximately 30,000 knowledgeable and helpful sales experts globally. RadioShack's retail network includes approximately 4,300 company-operated stores in the United States, over 270 company-operated stores in Mexico, and approximately 1,000 dealer and other outlets worldwide. For more information on RadioShack Corporation, please visit www.radioshackcorporation.com; to purchase items online, please visit www.radioshack.com. RadioShack® is a registered trademark licensed by RadioShack Corporation.


Analyst and Investor Contact:

News Media Contact:

Bruce Bishop

Media Relations

(817) 415-3400

(817) 415-3300

[email protected]

[email protected]

 


RADIOSHACK CORPORATION AND SUBSIDIARIES


Condensed Consolidated Statements of Comprehensive Income (unaudited)




















Three Months Ended


Nine Months Ended



September 30,


September 30,

(In millions, except per share amounts)


2013


2012


2013


2012

Net sales and operating revenues


$

805.4



$

898.0



$

2,498.9



$

2,659.9


Cost of products sold



562.7




557.2




1,605.1




1,608.8


Gross profit



242.7




340.8




893.8




1,051.1



















Operating expenses:

















Selling, general and administrative



343.3




354.0




1,018.1




1,036.3


Depreciation and amortization



15.0




16.0




47.0




49.5


Impairment of long-lived assets and goodwill



2.4




4.8




6.6




6.3


Total operating expenses



360.7




374.8




1,071.7




1,092.1



















Operating loss



(118.0)




(34.0)




(177.9)




(41.0)



















Interest income



0.3




0.5




1.0




1.3


Interest expense



(11.5)




(13.2)




(40.6)




(39.2)


Other loss



--




(0.6)




(0.3)




(0.6)



















Loss from continuing operations before income taxes



(129.2)




(47.3)




(217.8)




(79.5)


Income tax benefit



(16.8)




(15.9)




(17.2)




(27.2)



















Loss from continuing operations



(112.4)




(31.4)




(200.6)




(52.3)


Discontinued operations, net of income taxes



--




(15.7)




(8.2)




(23.8)



















Net loss


$

(112.4)



$

(47.1)



$

(208.8)



$

(76.1)



















Basic and diluted net loss per share:

















Loss per share from continuing operations


$

(1.11)



$

(0.31)



$

(1.99)



$

(0.52)


Loss per share from discontinued operations



--




(0.16)




(0.08)




(0.24)


Net loss per share


$

(1.11)



$

(0.47)



$

(2.07)



$

(0.76)



















Shares used in computing net loss per share:


































Basic and diluted



101.0




100.1




100.7




100.1




































Comprehensive loss


$

(113.2)



$

(44.6)



$

(208.9)



$

(70.9)


 

RADIOSHACK CORPORATION AND SUBSIDIARIES


Consolidated Balance Sheets (unaudited)
















September 30,


December 31,


September 30,

(In millions)


2013


2012


2012

Assets













Current assets:













Cash and cash equivalents


$

316.4



$

535.7



$

546.1


Accounts and notes receivable, net



201.6




452.5




349.2


Inventories



707.7




908.3




851.1


Other current assets



105.2




85.4




174.0


Total current assets



1,330.9




1,981.9




1,920.4















Property, plant and equipment, net



203.2




239.0




241.0


Goodwill, net



36.1




36.6




36.9


Other assets, net



36.9




41.6




39.0


Total assets


$

1,607.1



$

2,299.1



$

2,237.3















Liabilities and Stockholders' Equity













Current liabilities:













Current maturities of long-term debt


$

1.0



$

278.7



$

275.2


Accounts payable



282.1




435.6




386.2


Accrued expenses and other current liabilities



217.4




263.9




261.3


Total current liabilities



500.5




978.2




922.7















Long-term debt, excluding current maturities



498.3




499.0




474.0


Other non-current liabilities



214.3




223.2




178.2


Total liabilities



1,213.1




1,700.4




1,574.9















Total stockholders' equity



394.0




598.7




662.4


Total liabilities and stockholders' equity


$

1,607.1



$

2,299.1



$

2,237.3


 

RADIOSHACK CORPORATION AND SUBSIDIARIES


Consolidated Statements of Cash Flows (unaudited)












Nine Months Ended




September 30,


(In millions)


2013


2012

Cash flows from operating activities:







Net loss


$

(208.8)



$

(76.1)


Adjustments to reconcile net loss to net cash









provided by operating activities:









Depreciation and amortization



54.9




60.7


Amortization of discounts on long-term debt



7.1




12.8


Impairment of long-lived assets and goodwill



6.6




18.0


Stock-based compensation



5.9




6.0


Other non-cash items



4.2




11.1


Changes in assets and liabilities:









Accounts and notes receivable



252.2




102.8


Inventories



200.3




(104.0)


Other current assets



(10.7)




(35.3)


Accounts payable



(76.6)




74.1


Accrued expenses and other



(59.5)




(37.7)


Net cash provided by operating activities



175.6




32.4











Cash flows from investing activities:









Additions to property, plant and equipment



(26.6)




(44.5)


Proceeds from sale of property, plant and equipment



6.5




--


Changes in restricted cash



(6.8)




(26.5)


Other investing activities



(3.0)




0.1


Net cash used in investing activities



(29.9)




(70.9)











Cash flows from financing activities:









Principal amount of long-term debt repayments



(286.9)




(88.1)


Net proceeds from issuance of long-term debt



--




150.0


Payments of debt issuance costs



--




(5.9)


Payments of dividends



--




(24.9)


Changes in cash overdrafts



(78.1)




(38.2)


Net cash used in financing activities



(365.0)




(7.1)











Net decrease in cash and cash equivalents



(219.3)




(45.6)


Cash and cash equivalents, beginning of period



535.7




591.7


Cash and cash equivalents, end of period


$

316.4



$

546.1


 

RADIOSHACK CORPORATION AND SUBSIDIARIES


Segment Reporting (unaudited)




















Three Months Ended


Nine Months Ended



September 30,


September 30,

(In millions)


2013


2012


2013


2012


















Net sales and operating revenues:

















U.S. RadioShack company-operated stores


$

733.9



$

814.4



$

2,272.7



$

2,420.4


Other



71.5




83.6




226.2




239.5




$

805.4



$

898.0



$

2,498.9



$

2,659.9



















Operating income (loss):

















U.S. RadioShack company-operated stores


$

(26.5)



$

62.1



$

74.1



$

225.4


Other



1.6




10.1




13.2




24.5





(24.9)




72.2




87.3




249.9



















Unallocated



(93.1)




(106.2)




(265.2)




(290.9)


Operating loss



(118.0)




(34.0)




(177.9)




(41.0)



















Interest income



0.3




0.5




1.0




1.3


Interest expense



(11.5)




(13.2)




(40.6)




(39.2)


Other loss



--




(0.6)




(0.3)




(0.6)


Loss from continuing operations before income taxes


$

(129.2)



$

(47.3)



$

(217.8)



$

(79.5)


 

SOURCE RadioShack Corporation

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
IoT is at the core or many Digital Transformation initiatives with the goal of re-inventing a company's business model. We all agree that collecting relevant IoT data will result in massive amounts of data needing to be stored. However, with the rapid development of IoT devices and ongoing business model transformation, we are not able to predict the volume and growth of IoT data. And with the lack of IoT history, traditional methods of IT and infrastructure planning based on the past do not app...
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place June 6-8, 2017, at the Javits Center in New York City, New York, is co-located with 20th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry p...
"LinearHub provides smart video conferencing, which is the Roundee service, and we archive all the video conferences and we also provide the transcript," stated Sunghyuk Kim, CEO of LinearHub, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Internet of @ThingsExpo, taking place June 6-8, 2017 at the Javits Center in New York City, New York, is co-located with the 20th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. @ThingsExpo New York Call for Papers is now open.
"There's a growing demand from users for things to be faster. When you think about all the transactions or interactions users will have with your product and everything that is between those transactions and interactions - what drives us at Catchpoint Systems is the idea to measure that and to analyze it," explained Leo Vasiliou, Director of Web Performance Engineering at Catchpoint Systems, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York Ci...
The 20th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held June 6-8, 2017, at the Javits Center in New York City, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit your speaking proposal ...
WebRTC is the future of browser-to-browser communications, and continues to make inroads into the traditional, difficult, plug-in web communications world. The 6th WebRTC Summit continues our tradition of delivering the latest and greatest presentations within the world of WebRTC. Topics include voice calling, video chat, P2P file sharing, and use cases that have already leveraged the power and convenience of WebRTC.
20th Cloud Expo, taking place June 6-8, 2017, at the Javits Center in New York City, NY, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy.
Discover top technologies and tools all under one roof at April 24–28, 2017, at the Westin San Diego in San Diego, CA. Explore the Mobile Dev + Test and IoT Dev + Test Expo and enjoy all of these unique opportunities: The latest solutions, technologies, and tools in mobile or IoT software development and testing. Meet one-on-one with representatives from some of today's most innovative organizations
DevOps is being widely accepted (if not fully adopted) as essential in enterprise IT. But as Enterprise DevOps gains maturity, expands scope, and increases velocity, the need for data-driven decisions across teams becomes more acute. DevOps teams in any modern business must wrangle the ‘digital exhaust’ from the delivery toolchain, "pervasive" and "cognitive" computing, APIs and services, mobile devices and applications, the Internet of Things, and now even blockchain. In this power panel at @...
Data is the fuel that drives the machine learning algorithmic engines and ultimately provides the business value. In his session at Cloud Expo, Ed Featherston, a director and senior enterprise architect at Collaborative Consulting, discussed the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
"A lot of times people will come to us and have a very diverse set of requirements or very customized need and we'll help them to implement it in a fashion that you can't just buy off of the shelf," explained Nick Rose, CTO of Enzu, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
The WebRTC Summit New York, to be held June 6-8, 2017, at the Javits Center in New York City, NY, announces that its Call for Papers is now open. Topics include all aspects of improving IT delivery by eliminating waste through automated business models leveraging cloud technologies. WebRTC Summit is co-located with 20th International Cloud Expo and @ThingsExpo. WebRTC is the future of browser-to-browser communications, and continues to make inroads into the traditional, difficult, plug-in web co...
Buzzword alert: Microservices and IoT at a DevOps conference? What could possibly go wrong? In this Power Panel at DevOps Summit, moderated by Jason Bloomberg, the leading expert on architecting agility for the enterprise and president of Intellyx, panelists peeled away the buzz and discuss the important architectural principles behind implementing IoT solutions for the enterprise. As remote IoT devices and sensors become increasingly intelligent, they become part of our distributed cloud enviro...
In 2014, Amazon announced a new form of compute called Lambda. We didn't know it at the time, but this represented a fundamental shift in what we expect from cloud computing. Now, all of the major cloud computing vendors want to take part in this disruptive technology. In his session at 20th Cloud Expo, John Jelinek IV, a web developer at Linux Academy, will discuss why major players like AWS, Microsoft Azure, IBM Bluemix, and Google Cloud Platform are all trying to sidestep VMs and containers...
SYS-CON Events announced today that MobiDev, a client-oriented software development company, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place June 6-8, 2017, at the Javits Center in New York City, NY, and the 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. MobiDev is a software company that develops and delivers turn-key mobile apps, websites, web services, and complex softw...
WebRTC is about the data channel as much as about video and audio conferencing. However, basically all commercial WebRTC applications have been built with a focus on audio and video. The handling of “data” has been limited to text chat and file download – all other data sharing seems to end with screensharing. What is holding back a more intensive use of peer-to-peer data? In her session at @ThingsExpo, Dr Silvia Pfeiffer, WebRTC Applications Team Lead at National ICT Australia, looked at differ...
Growth hacking is common for startups to make unheard-of progress in building their business. Career Hacks can help Geek Girls and those who support them (yes, that's you too, Dad!) to excel in this typically male-dominated world. Get ready to learn the facts: Is there a bias against women in the tech / developer communities? Why are women 50% of the workforce, but hold only 24% of the STEM or IT positions? Some beginnings of what to do about it! In her Day 2 Keynote at 17th Cloud Expo, Sandy Ca...
Fact is, enterprises have significant legacy voice infrastructure that’s costly to replace with pure IP solutions. How can we bring this analog infrastructure into our shiny new cloud applications? There are proven methods to bind both legacy voice applications and traditional PSTN audio into cloud-based applications and services at a carrier scale. Some of the most successful implementations leverage WebRTC, WebSockets, SIP and other open source technologies. In his session at @ThingsExpo, Da...
SYS-CON Media announced today that @WebRTCSummit Blog, the largest WebRTC resource in the world, has been launched. @WebRTCSummit Blog offers top articles, news stories, and blog posts from the world's well-known experts and guarantees better exposure for its authors than any other publication. @WebRTCSummit Blog can be bookmarked ▸ Here @WebRTCSummit conference site can be bookmarked ▸ Here