Home goods specialty retailer Conn’s consolidated revenue rose 9.3 per cent to $366.1 million in the fourth quarter, partly driven by the acquisition of fellow furniture retailer WS Badcock.
The increase included 8.6 per cent growth in net sales, a 10.7 per cent increase in finance charges and other revenues, and $68.4 million from the Badcock transaction on December 18.
Retail revenues were up 9.6 per cent to $296.9 million, primarily driven by Badcock revenue of $60.3 million and offset by a 14.4 per cent decrease in Conn’s same-store sales. The company attributed the same-store sales decline to lower discretionary spending on home-related products.
On the bottom line, the company swung to a net income of $43.3 million from a net loss of $42.8 million in the year-ago period.
“Since completing the transformative transaction with WS Badcock in December, we have focused on successfully integrating the two organizations, aligning around a common culture, and establishing a platform to drive significant revenue and cost synergies in the coming quarters,” said Norm Miller, Conn’s president and CEO.
“…We have removed approximately $50 million of combined expenses during the fourth quarter and we have identified over $50 million of additional cost synergies that we expect to realize over the next 18 months.”
For the full year, the company’s consolidated revenue fell 7.8 per cent to $1.2 billion, due to a 9.1 per cent drop in total net sales, and a 3.6 per cent reduction in finance charges and other revenues. The firm’s net loss widened to $76.8 million from $59.2 million in the prior year.
Miller expects the macro-environment to remain challenging in FY25, but remains confident that the company’s strategic initiatives combined with the Badcock transaction will help it achieve improvements in both retail sales and profitability.
Conn’s operates more than 550 stores across 15 states, offering furniture and mattresses, appliances, and consumer electronics.
