Appliance Recycling Centers of America soars on 32% Q3 revenue jump
Appliance Recycling Centers of America (Nasdaq: ARCI) shares are soaring after the home appliance retailer reported third-quarter sales of $27.4 million, up 32% from $20.8 million a year earlier and above analyst estimates of $25.9 million. The firm’s quarterly profit totaled $1.4 million, or $0.31 per share, beating Wall Street projections of $0.17 per share and compared with $0.02 million, or $0.00 per share, during the same period of 2006.
“As evidenced by the modest decline in same-store sales of our ApplianceSmart operation, the primary focus of our retail business on the replacement appliance market has helped moderate the impact of the ongoing slowdown in the nation's residential construction sector,” CEO Edward Cameron said in a statement. “ApplianceSmart is also benefiting from the improved operating efficiencies that have been achieved by strengthening inventory management and implementing other new business systems.”
The Minneapolis-based firm also announced that it plans to open a fourth factory outlet store in Columbus, Ohio, in November. The 28,000 square-foot ApplianceSmart outlet store will bring the company’s total number of outlet locations to 15.
“ApplianceSmart has established a strong presence in the Columbus market by offering customers a wide selection of high-quality, discount-priced appliances,” Cameron said. “The addition of a fourth outlet to serve this market will enable us to increase our market penetration, while generating greater economies of scale as we leverage advertising support and other overhead expenses.”
The firm’s third-quarter selling, general and administrative expenses rose to $7.5 million, from $6.4 million a year earlier.
In afternoon trading, ARCI shares are jumping 32.46%, or $2.53, at $10.32. Over the last 52 weeks, shares have ranged from $1.78 to $11.24.
