FORT WORTH, Texas (AP) — Consumer electronics chain RadioShack Corporation said its first-quarter profit improved as sales perked up on the switch to all-digital television signals. Its wireless business also improved in the quarter.
The Fort Worth, Texas-based company earned $43.1 million, or 34 cents a share, for the period ended March 31, up from $38.8 million, or 30 cents per share, a year ago.
The latest results topped Wall Street’s forecast for earnings of 22 cents a share. The estimates of analysts polled by Thomson Reuters normally exclude one-time items.
RadioShack continued to get a sales boost from shoppers buying digital converter boxes ahead of the federally mandated conversion to all-digital television signals this year. The retailer sold more than 1 million converter boxes in the quarter, totaling about $70 million in sales.
However, some experts say the sales boost from the all-digital switch will begin to evaporate once all households that need the converter boxes have them, and RadioShack will need to focus more on cell phone sales.
To that end, the retailer said its wireless business helped revenue climb 5.6 percent, to $1 billion. Analysts expected sales of $937 million.
Same-store sales for company-run stores, or sales at stores open at least a year, increased 5 percent. The same-store sales gauge is a key indicator of retailer performance, measuring growth at existing stores while excluding sales from newly opened ones.
RadioShack also said it is controlling its capital expenditures. It recorded $26.2 million in capital expenditures during the quarter and expects its 2009 total in the range of $75 million to $100 million.
“Our disciplined approach to working capital management has again resulted in further strengthening our balance sheet and we continue to believe that a strong balance sheet is important in trying economic times,” Chairman and CEO Julian Day said in a statement.
RadioShack, which has more than 34,000 employees, runs about 4,400 company-operated stores. It also has nearly 1,400 dealer outlets; almost 700 U.S. wireless phone kiosks and approximately 200 company-operated stores in Mexico.
