Conn’s, Inc. Reports Record Retail Gross Margin in Quarter Ended October 31, 2012

  Conn’s, Inc. Reports Record Retail Gross Margin in Quarter Ended October 31,

                  Same store sales up 12.6% over prior year

              Retail gross margin approximately 35% for quarter

Business Wire

THE WOODLANDS, Texas -- November 08, 2012

Conn’s, Inc. (NASDAQ: CONN), a specialty retailer of home appliances,
furniture, mattresses and consumer electronics and provider of consumer
credit, today announced its net sales for the three months ended October 31,

Net sales for the three months ended October 31, 2012, were $167.3 million, an
increase of $12.4 million, or 8.0%, over the prior-year period. Net sales
include total product sales, repair service agreement commissions and service
revenues. Same store sales (sales recorded in stores operated for the entirety
of both periods) for the quarter ended October31, 2012 grew 12.6% over the
prior period, on top of same store growth of 18.9% a year ago. The Company had
65 and 70 stores open at October 31, 2012 and 2011, respectively.

“We delivered our fifth straight quarter of double-digit, year-over-year same
store sales growth,” commented Theodore M. Wright, the Company’s Chairman and
CEO. “The expansion of our furniture and mattress business and improved sales
mix across all categories increased our retail gross margin. Consumer
electronic same store sales were down only 3% despite continued industry
headwinds in this category.”

The retail gross margin, which includes gross profit from both product and
repair service agreement sales, was approximately 35% for the three months
ended October 31, 2012, an approximate 970 basis point increase over the same
period last year. During the three months ended October 31, 2011, the Company
adjusted its inventory valuation reserve – reducing retail gross margin for
the prior-year period and benefiting the reported margin expansion in the
current-year period by 300basis points.

The following table presents net sales by category and changes in net sales
for the quarter:

              Quarter ended October 31,                                        Same
                2012       % of     2011       % of      Change       % Change   %
                            Total                 Total                             change
                (dollars in thousands)
Home            $ 48,499    29.0  %   $ 46,993    30.3  %   $ 1,506      3.2   %    6.4  %
and               32,346    19.3  %     24,567    15.9  %     7,779      31.7  %    34.0 %
Consumer          47,082    28.1  %     50,073    32.3  %     (2,991 )   (6.0  )%   (3.2 )%
Home office       16,169    9.7   %     13,242    8.6   %     2,927      22.1  %    27.5 %
Other            7,567     4.5   %    5,529     3.6   %    2,038     36.9  %    59.8 %
product           151,663   90.6  %     140,404   90.7  %     11,259     8.0   %    11.5 %
agreement         12,183    7.3   %     10,601    6.8   %     1,582      14.9  %    23.1 %
Service          3,477     2.1   %    3,950     2.5   %    (473   )   (12.0 )%
Total net       $ 167,323   100.0 %   $ 154,955   100.0 %   $ 12,368    8.0   %    12.6 %

The following provides a summary of items influencing the Company’s major
product categories during the quarter, compared to the same quarter last
fiscal year:

  *Home appliance average selling price rose 24.4%, partially offset by a
    17.4% decline in unit volume. Previous store closures caused approximately
    one-quarter of the decrease in unit sales. On a same store basis, laundry
    sales rose 14.9%, refrigeration sales increased 3.6% and cooking sales
    increased 24.7%. Milder temperatures drove a 26.0% decline in room air
    conditioner sales;
  *Enhanced presentation and product selection together with increased
    promotional activity drove continued growth in furniture and mattress
    sales. Previous store closures tempered the reported increase.

       *Furniture same store unit sales increased 16.4% and there was a 15.2%
         increase in the average sales price.
       *On a same store basis, the average mattress selling price increased
         41.6% with a 5.4% decline in unit volume – driven by a shift to a
         higher price-point product offering;

  *Consumer electronic sales declined due primarily to the emphasis of higher
    price-point televisions and previous store closures. Same store sales of
    televisions with a screen size of over 50 inches rose on both a unit and
    dollar basis; and
  *Higher tablet sales and a 28.0% increase in the average selling price of
    computers guided the growth in home office sales. The reported growth was
    partially offset by the impact of store closures, a reduction in computer
    unit volume and lower sales of accessory items.

All of the above amounts are preliminary estimates and are subject to change
upon completion of the Company’s quarterly financial statement closing
process. Actual results may differ significantly from the preliminary

The Company will host a conference call and audio webcast on Monday, December
3, 2012, at 10:00 A.M. CT, to discuss its earnings and operating performance
for the quarter. The webcast will be available live at and will
be archived for one year. Participants can join the call by dialing
877-754-5302 or 678-894-3020.

About Conn’s, Inc.

Conn’s is a specialty retailer and operated 65 retail locations at October 31,
2012, with 57 in Texas, six in Louisiana and two in Oklahoma. The Company’s
primary product categories include:

  *Home appliance, including refrigerators, freezers, washers, dryers,
    dishwashers, ranges and room air conditioners;
  *Furniture and mattress, including furniture for the living room, dining
    room, bedroom and related accessories and mattresses;
  *Consumer electronic, including LCD, LED, 3-D, plasma and DLP televisions,
    camcorders, digital cameras, Blu-ray players, video game equipment,
    portable audio and home theater products; and
  *Home office, including desktop and notebook computers, tablets, printers
    and computer accessories.

Additionally, the Company offers a variety of products on a seasonal basis,
including lawn and garden equipment, and continues to introduce additional
product categories for the home to help respond to its customers' product
needs and to increase same store sales. Unlike many of its competitors, the
Company provides flexible in-house credit options for its customers, in
addition to third-party financing programs and third-party rent-to-own payment
plans. In the last three years, the Company financed, on average,
approximately 61%, including down payments, of its retail sales under its
in-house financing plan.

This press release contains forward-looking statements that involve risks and
uncertainties. Such forward-looking statements include information concerning
our financial performance, business strategy, plans, goals and objectives.
Statements containing the words “anticipate,” “believe,” “could,” “estimate,”
“expect,” “intend,” “may,” “plan,” “project,” “should,” or the negative of
such terms or other similar expressions are generally forward-looking in
nature and not historical facts. Although we believe that the expectations,
opinions, projections, and comments reflected in these forward-looking
statements are reasonable, we can give no assurance that such statements will
prove to be correct. You are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this press
release. Except as required by law, we are not obligated to publicly release
any revisions to these forward-looking statements to reflect events or
circumstances after the date of this press release or to reflect the
occurrence of unanticipated events.



Conn’s, Inc.
Chief Financial Officer
Brian Taylor, 936-230-5899
S.M. Berger & Company
Andrew Berger, 216-464-6400
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