Welcome!

Wearables Authors: Elizabeth White, Jnan Dash, Cloud Best Practices Network, Pat Romanski, Liz McMillan

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
What happens when the different parts of a vehicle become smarter than the vehicle itself? As we move toward the era of smart everything, hundreds of entities in a vehicle that communicate with each other, the vehicle and external systems create a need for identity orchestration so that all entities work as a conglomerate. Much like an orchestra without a conductor, without the ability to secure, control, and connect the link between a vehicle’s head unit, devices, and systems and to manage the ...
If you had a chance to enter on the ground level of the largest e-commerce market in the world – would you? China is the world’s most populated country with the second largest economy and the world’s fastest growing market. It is estimated that by 2018 the Chinese market will be reaching over $30 billion in gaming revenue alone. Admittedly for a foreign company, doing business in China can be challenging. Often changing laws, administrative regulations and the often inscrutable Chinese Interne...
Cloud computing is being adopted in one form or another by 94% of enterprises today. Tens of billions of new devices are being connected to The Internet of Things. And Big Data is driving this bus. An exponential increase is expected in the amount of information being processed, managed, analyzed, and acted upon by enterprise IT. This amazing is not part of some distant future - it is happening today. One report shows a 650% increase in enterprise data by 2020. Other estimates are even higher....
As ridesharing competitors and enhanced services increase, notable changes are occurring in the transportation model. Despite the cost-effective means and flexibility of ridesharing, both drivers and users will need to be aware of the connected environment and how it will impact the ridesharing experience. In his session at @ThingsExpo, Timothy Evavold, Executive Director Automotive at Covisint, will discuss key challenges and solutions to powering a ride sharing and/or multimodal model in the a...
SYS-CON Events announced today that CDS Global Cloud, an Infrastructure as a Service provider, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. CDS Global Cloud is an IaaS (Infrastructure as a Service) provider specializing in solutions for e-commerce, internet gaming, online education and other internet applications. With a growing number of data centers and network points around the world, ...
SYS-CON Events announced today that LeaseWeb USA, a cloud Infrastructure-as-a-Service (IaaS) provider, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. LeaseWeb is one of the world's largest hosting brands. The company helps customers define, develop and deploy IT infrastructure tailored to their exact business needs, by combining various kinds cloud solutions.
WebRTC is bringing significant change to the communications landscape that will bridge the worlds of web and telephony, making the Internet the new standard for communications. Cloud9 took the road less traveled and used WebRTC to create a downloadable enterprise-grade communications platform that is changing the communication dynamic in the financial sector. In his session at @ThingsExpo, Leo Papadopoulos, CTO of Cloud9, discussed the importance of WebRTC and how it enables companies to focus...
Big Data has been changing the world. IoT fuels the further transformation recently. How are Big Data and IoT related? In his session at @BigDataExpo, Tony Shan, a renowned visionary and thought leader, will explore the interplay of Big Data and IoT. He will anatomize Big Data and IoT separately in terms of what, which, why, where, when, who, how and how much. He will then analyze the relationship between IoT and Big Data, specifically the drilldown of how the 4Vs of Big Data (Volume, Variety,...
19th Cloud Expo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, 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. Meanwhile, 94% of enterpri...
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 19th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The Internet of Things (IoT) is the most profound change in personal and enterprise IT since the creation of the Worldwide Web more than 20 years ago. All major researchers estimate there will be tens of billions devices - comp...
For basic one-to-one voice or video calling solutions, WebRTC has proven to be a very powerful technology. Although WebRTC’s core functionality is to provide secure, real-time p2p media streaming, leveraging native platform features and server-side components brings up new communication capabilities for web and native mobile applications, allowing for advanced multi-user use cases such as video broadcasting, conferencing, and media recording.
A strange thing is happening along the way to the Internet of Things, namely far too many devices to work with and manage. It has become clear that we'll need much higher efficiency user experiences that can allow us to more easily and scalably work with the thousands of devices that will soon be in each of our lives. Enter the conversational interface revolution, combining bots we can literally talk with, gesture to, and even direct with our thoughts, with embedded artificial intelligence, wh...
Ask someone to architect an Internet of Things (IoT) solution and you are guaranteed to see a reference to the cloud. This would lead you to believe that IoT requires the cloud to exist. However, there are many IoT use cases where the cloud is not feasible or desirable. In his session at @ThingsExpo, Dave McCarthy, Director of Products at Bsquare Corporation, will discuss the strategies that exist to extend intelligence directly to IoT devices and sensors, freeing them from the constraints of ...
Web Real-Time Communication APIs have quickly revolutionized what browsers are capable of. In addition to video and audio streams, we can now bi-directionally send arbitrary data over WebRTC's PeerConnection Data Channels. With the advent of Progressive Web Apps and new hardware APIs such as WebBluetooh and WebUSB, we can finally enable users to stitch together the Internet of Things directly from their browsers while communicating privately and securely in a decentralized way.
Information technology is an industry that has always experienced change, and the dramatic change sweeping across the industry today could not be truthfully described as the first time we've seen such widespread change impacting customer investments. However, the rate of the change, and the potential outcomes from today's digital transformation has the distinct potential to separate the industry into two camps: Organizations that see the change coming, embrace it, and successful leverage it; and...
Technology vendors and analysts are eager to paint a rosy picture of how wonderful IoT is and why your deployment will be great with the use of their products and services. While it is easy to showcase successful IoT solutions, identifying IoT systems that missed the mark or failed can often provide more in the way of key lessons learned. In his session at @ThingsExpo, Peter Vanderminden, Principal Industry Analyst for IoT & Digital Supply Chain to Flatiron Strategies, will focus on how IoT de...
In his session at @ThingsExpo, Kausik Sridharabalan, founder and CTO of Pulzze Systems, Inc., will focus on key challenges in building an Internet of Things solution infrastructure. He will shed light on efficient ways of defining interactions within IoT solutions, leading to cost and time reduction. He will also introduce ways to handle data and how one can develop IoT solutions that are lean, flexible and configurable, thus making IoT infrastructure agile and scalable.
Complete Internet of Things (IoT) embedded device security is not just about the device but involves the entire product’s identity, data and control integrity, and services traversing the cloud. A device can no longer be looked at as an island; it is a part of a system. In fact, given the cross-domain interactions enabled by IoT it could be a part of many systems. Also, depending on where the device is deployed, for example, in the office building versus a factory floor or oil field, security ha...
An IoT product’s log files speak volumes about what’s happening with your products in the field, pinpointing current and potential issues, and enabling you to predict failures and save millions of dollars in inventory. But until recently, no one knew how to listen. In his session at @ThingsExpo, Dan Gettens, Chief Research Officer at OnProcess, will discuss recent research by Massachusetts Institute of Technology and OnProcess Technology, where MIT created a new, breakthrough analytics model f...
There are several IoTs: the Industrial Internet, Consumer Wearables, Wearables and Healthcare, Supply Chains, and the movement toward Smart Grids, Cities, Regions, and Nations. There are competing communications standards every step of the way, a bewildering array of sensors and devices, and an entire world of competing data analytics platforms. To some this appears to be chaos. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, Bradley Holt, Developer Advocate a...