Hechinger net falls due to costs linked to 8 new HQ stores

November 19, 1993|By Staff Report

Despite a 13.3 percent rise in sales, net income for the Hechinger Co. dropped 63 percent in its third quarter because of the expenses of opening eight Home Quarters Warehouses.

Revenue for the Landover-based home-improvement chain grew to $529.4 million during the quarter that ended Oct. 30. Earnings dropped to $2.4 million, or 6 cents a share. By contrast, operating income for the quarter rose to $13.7 million, from $12.4 million a year ago.

The drop in net income was attributed to an $8.8 million expense in opening eight stores in the company's Home Quarters subsidiary, which has 53 stores in the South, Midwest and New England.

Those expenses were higher than normal because of investments in staffing and promotions and delays to include design changes.

"The increase in operating income is due to the strong quarter turned in by Home Quarters Warehouse, whose operating income in the third quarter continued to grow faster than sales," John W. Hechinger Jr., president and chief executive, said in a statement.

Hechinger Co.

E;.. .. .. .. ..Ticker.. .. .. .. .. .. ..Yesterday's... ..

.. .. .. .. ..Symbol .. .. .. .. .. .. Cls.. .. .. .. Chg

.. .. .. .. ..HECHA .. .. .. .. .. .. ..10.. .. .. .. ..- .. .. .. .. ..HECHB .. .. .. .. .. .. ..9 3/4 .. .. .. .. ..- 1/4

Period ended

Oct. 30 .. .. .. ..3rd qtr.. .. .. ..Year ago.. .. .. Chg.

Revenue .. .. .. ..$529,372.. .. .. .$467,140 .. .. ..+13.3%

Net Income .. .. ..$2,395 .. .. .. .. $6,532 .. .. .. -63.3%

Primary EPS .. .. .$0.06 .. .. .. .. $0.16 .. .. .. ..-62.5%

.. .. .. .. .. .. 39 wks.. .. .. .. .. Year ago.. .. ..Chg.

Revenue.. .. .. ..$1,623,497.. .. .. ..$1,462,600 .. ..+11.0%

Net Income .. .. .$23,517.. .. .. .. ..$(29,052)*.. .. . --

Primary EPS .. .. ..$0.56 .. .. .. .. .. $(0.70)*. .. .. --

Figures in thousands (except per share data)

*Includes a charge of $57.3 million, or $1.37 a share, related to conversions to Home Project Center format.

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