RadioShack Reports Financial Results for Second Quarter 2013 Including Second Quarter Comparable Store Sales Growth of 1.3%

RadioShack Reports Financial Results for Second Quarter 2013 Including Second
                Quarter Comparable Store Sales Growth of 1.3%

Holly F. Etlin Appointed Interim Chief Financial Officer

PR Newswire

FORT WORTH, Texas, July 23, 2013

FORT WORTH, Texas, July 23, 2013 /PRNewswire/ --RadioShack Corporation (NYSE:
RSH) today reported results for the second quarter ended June 30, 2013.


Joseph C. Magnacca, chief executive officer, said, "While the second quarter
presented a number of challenges, it is noteworthy that we generated
comparable store sales growth for the first time since 2010, and increased
sales for the sixth consecutive quarter in our high-margin signature platform
of products. In addition, we made progress on the initiatives we outlined last
quarter in repositioning our branding, opening a new concept store,
streamlining our product assortment, and entering new strategic partnerships.

"At the same time, our profitability was not where we would have liked. Our
strategy this quarter was designed to move through unproductive inventory and
test a variety of promotional vehicles, which we knew would have an impact on
gross margin rate, but would help us identify opportunities to better align
our promotional marketing going forward.

"Looking ahead, we expect the turnaround to take several quarters, and during
that time our results may vary from quarter to quarter as we make strategic
changes to improve our long-term financial performance. We will be guided by
the five pillars of our turnaround strategy – repositioning the brand,
revamping our product assortment, reinvigorating our stores, operational
efficiency and financial flexibility. To support and accelerate the
turnaround, we have decided to bring in AlixPartners, a global business
advisory firm with expertise in corporate turnarounds, and Peter J. Solomon
Company, an investment banking firm.

"We have a clear plan of action and our team is completely focused on driving
the business forward. I remain confident that we can build on our strengths,
improve our financial performance, and return this company to a position of
prominence in the lexicon of American retailers," Mr. Magnacca concluded.

The company also announced that Dorvin D. Lively has resigned to pursue a new
career opportunity and that Holly F. Etlin, a managing director at
AlixPartners, has been named interim Chief Financial Officer.


  oTotal net sales and operating revenues were $845 million, compared to $849
    million last year. The decline was driven by the impact from closed stores
    offset by comparable store sales growth of 1.3%. Our signature platform
    generated the sixth consecutive quarter of sales growth in our U.S.
    company-operated stores.
  oGross profit was $314 million, compared with $340 million last year. Gross
    profit performance was negatively impacted by a soft demand for postpaid
    units and consumer response to specific promotions during the quarter.
  oGross margin was 37.2% of net sales, compared to 40.1% last year. Gross
    margin performance was negatively impacted by our planned promotional
    strategy this quarter, which included testing different promotions and
    clearance events.
  oSelling, general and administrative (SG&A) expenses were $337 million, or
    39.9% of net sales, compared with $337 million last year.
  oOperating loss was $41 million, compared to $14 million last year.
  oNet loss was $53 million, or $0.53 per diluted share, compared to net loss
    of $21 million last year.
  oThe company continues to have a strong balance sheet and total liquidity
    of $818 million as of June 30, 2013.


The company ended the second quarter with total liquidity of $818 million,
including cash and cash equivalents of $432 million and $386 million of
available credit under the asset-based revolving credit facility that expires
in January 2016.

During the quarter, the company repurchased $2 million in principal value of
the 2013 Convertible Notes due August 1, 2013, for a total purchase price of
$2 million.

The company's total debt was $713 million at June 30, 2013. The 2013
Convertible Notes, which had a par value of $375 million when issued, had a
remaining aggregate principal amount of $214 million at June 30, 2013. As
previously stated, the company's intention is to pay the balance of the
Convertible Notes at maturity with cash. The balance of the company's debt
comes due between 2016 and 2019.

Capital spending totaled $6 million in the second quarter compared to $17
million last year.


Following Dorvin Lively's decision to pursue a new career opportunity with a
strategic equity-owned retail company, the company is undertaking a search for
a permanent chief financial officer.

Daniel R. Feehan, Non-Executive Chairman of RadioShack's Board, said, "On
behalf of our entire Board, I would like to thank Dorvin for his substantial
contribution and integral role in our transformation efforts, as well as his
steady leadership as our interim CEO. We understand and respect his desire to
move forward with a meaningful new professional opportunity, and we wish him

Joseph Magnacca, Chief Executive Officer, said, "Dorvin has been an important
partner to me personally over the past few months as I joined the team, and we
appreciate the range of his services to RadioShack. We are also very pleased
that Holly Etlin will be stepping in to serve as the interim CFO."

Mr. Lively said, "I am looking forward to the next step in my career, knowing
that I leave the Company in good hands as it continues on its turnaround path
with a revamped management team, a new strategic vision, and strong liquidity
and financial flexibility."

Note: All comparisons are versus the same period of the prior fiscal year
unless otherwise noted.


RadioShack will host a live webcast of its investor conference call at 9 a.m.
EDT today. The Internet broadcast may be accessed from the investor relations
home page of the RadioShack corporate website at

An archived replay of the conference call will be available in the investor
relations section of the corporate website, A
telephone replay will be available beginning at approximately 11 a.m. EDT
today and will remain available until midnight EDT on August 8, 2013. The
telephone replay can be accessed by calling toll-free at (888) 286-8010, or
via toll call at (617) 801-6888. The replay pass code is 73501828.

For more information about performance, refer to the RadioShack Corporation
Quarterly Report on Form 10-Q filed with the Securities and Exchange
Commission on July 23, 2013.


This press release contains forward-looking statements, as referenced in the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements reflect management's current views and projections regarding
economic conditions, the retail industry environment and company performance.
These statements can be identified by the fact that they include words like
"anticipate," "believe," "estimate," "expect," "intend," "project,"
"guidance," "plan," "outlook" and other words with similar meaning. We
specifically disclaim any duty to update any of the information set forth in
this press release, including any forward-looking statements. These
statements involve a number of risks and uncertainties that could cause our
actual results to differ materially from the results discussed in our
forward-looking statements. Factors that could cause our actual results to
differ materially from the results discussed in our forward-looking statements
include, but are not limited to, our ability to execute and the effectiveness
of our 2013 initiatives; the underperformance or loss of certain of our
important vendors, such as our wireless carrier providers, or breaches by them
of our agreements with them; difficulties associated with our transition to an
outsourced arrangement for the production of products we previously
manufactured at our Chinese manufacturing plant; an adverse impact on our
sales or profitability due to our transition to such an outsourced
arrangement; an adverse impact on our sales or profitability due to changes
wireless carrier providers make to their customer credit requirements,
frequency of upgrade eligibility, or other operational matters, and the
timing, completeness, and accuracy of information we receive about such
changes; a decline in our gross margin due to customer demand for lower
margin mobile devices, such as smartphones and tablets; overall sales
performance; economic conditions; product demand; expense levels; competitive
activity; interest rates; changes in the company's financial condition;
availability of products and services and other risks associated with the
company's vendors and service providers; the regulatory environment; and other
factors affecting the retail category in general. Additional information
regarding these and other factors is included in the company's filings with
the SEC, including its most recent Annual Report on Form 10-K for the year
ended Dec. 31, 2012.


RadioShack (NYSE: RSH) is a leading national retailer of innovative mobile
technology products and services, as well as products related to personal and
home technology and power supply needs. RadioShack^® offers consumers a
targeted assortment of wireless phones and other electronic products and
services from leading national brands, exclusive private brands and major
wireless carriers, all within a comfortable and convenient shopping
environment. RadioShack employs approximately 30,000 knowledgeable and
helpful sales experts globally. RadioShack's retail network includes more
than 4,300 company-operated stores in the United States, 270 company-operated
stores in Mexico, and approximately 1,000 dealer and other outlets worldwide.
For more information on RadioShack Corporation, please visit; to purchase items online, please RadioShack^® is a registered trademark licensed by
RadioShack Corporation.

Analyst and Investor Contact:   News Media Contact:
Bruce                                             Media Relations
(817)                                             (817) 415-3300


Condensed Consolidated Statements of Comprehensive Income (unaudited)
                                  Three Months Ended    Six Months Ended
                                  June 30,              June 30,
(In millions, except per share    2013       2012       2013        2012
Net sales and operating revenues  $ 844.5    $ 848.6    $ 1,693.5   $ 1,761.9
Cost of products sold               530.7      508.4      1,042.4     1,051.6
Gross profit                        313.8      340.2      651.1       710.3
Operating expenses:
Selling, general and                336.9      337.0      674.8       682.3
Depreciation and amortization       15.5       16.3       32.0        33.5
Impairment of long-lived assets     2.8        1.0        4.2         1.5
Total operating expenses            355.2      354.3      711.0       717.3
Operating loss                      (41.4)     (14.1)     (59.9)      (7.0)
Interest income                     0.3        0.3        0.7         0.8
Interest expense                    (14.1)     (12.9)     (29.1)      (26.0)
Other loss                          --         --         (0.3)       --
Loss from continuing operations     (55.2)     (26.7)     (88.6)      (32.2)
before income taxes
Income tax benefit                  (1.8)      (10.5)     (0.4)       (11.3)
Loss from continuing operations     (53.4)     (16.2)     (88.2)      (20.9)
Discontinued operations, net of     0.3        (4.8)      (8.2)       (8.1)
income taxes
Net loss                          $ (53.1)   $ (21.0)   $ (96.4)    $ (29.0)
Basic and diluted net loss per
Loss per share from continuing    $ (0.53)   $ (0.16)   $ (0.88)    $ (0.21)
Loss per share from discontinued    --         (0.05)     (0.08)      (0.08)
Net loss per share                $ (0.53)   $ (0.21)   $ (0.96)    $ (0.29)
Shares used in computing net
loss per share:
Basic and diluted                   100.7      100.1      100.7       100.0
Comprehensive loss                $ (56.7)   $ (23.9)   $ (95.7)    $ (26.3)


Consolidated Balance Sheets (unaudited)
                                          June 30,    December 31,  June 30,
(In millions)                             2013        2012          2012
Current assets:
Cash and cash equivalents                 $ 432.0     $  535.7      $ 517.7
Accounts and notes receivable, net          218.5        452.5        250.0
Inventories                                 825.8        908.3        828.7
Other current assets                        90.4         85.4         144.8
Total current assets                        1,566.7      1,981.9      1,741.2
Property, plant and equipment, net          208.8        239.0        256.5
Goodwill, net                               36.5         36.6         38.4
Other assets, net                           41.5         41.6         51.6
Total assets                              $ 1,853.5   $  2,299.1    $ 2,087.7
Liabilities and Stockholders' Equity
Current liabilities:
Current maturities of long-term debt      $ 213.5     $  278.7      $ 355.4
Accounts payable                            200.7        435.6        352.3
Accrued expenses and other current          213.4        263.9        241.7
Total current liabilities                   627.6        978.2        949.4
Long-term debt, excluding current           499.2        499.0        323.9
Other non-current liabilities               220.1        223.2        109.8
Total liabilities                           1,346.9      1,700.4      1,383.1
Total stockholders' equity                  506.6        598.7        704.6
Total liabilities and stockholders'       $ 1,853.5   $  2,299.1    $ 2,087.7


Consolidated Statements of Cash Flows (unaudited)
                                                     Six Months Ended
                                                     June 30,
(In millions)                                        2013        2012
Cash flows from operating activities:
Net loss                                             $ (96.4)    $ (29.0)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization                          37.7        41.0
Amortization of discounts on long-term debt            6.2         8.7
Impairment of long-lived assets                        4.2         1.5
Stock-based compensation                               4.8         3.7
Other non-cash items                                   1.9         3.1
Changes in assets and liabilities:
Accounts and notes receivable                          234.1       110.1
Inventories                                            82.5        (83.2)
Other current assets                                   1.1         (3.0)
Accounts payable                                       (155.7)     20.5
Accrued expenses and other                             (57.4)      (50.5)
Net cash provided by operating activities              63.0        22.9
Cash flows from investing activities:
Additions to property, plant and equipment             (11.7)      (27.7)
Proceeds from sale of property, plant and equipment    6.5         --
Changes in restricted cash                             (5.6)       (26.5)
Other investing activities                             (3.6)       0.1
Net cash used in investing activities                  (14.4)      (54.1)
Cash flows from financing activities:
Principal amount of long-term debt repayments          (72.5)      --
Payments of dividends                                  --          (24.9)
Changes in cash overdrafts                             (79.8)      (17.9)
Net cash used in financing activities                  (152.3)     (42.8)
Net decrease in cash and cash equivalents              (103.7)     (74.0)
Cash and cash equivalents, beginning of period         535.7       591.7
Cash and cash equivalents, end of period             $ 432.0     $ 517.7


Segment Reporting (unaudited)
                                  Three Months Ended    Six Months Ended
                                  June 30,              June 30,
(In millions)                     2013       2012       2013        2012
Net sales and operating
U.S. RadioShack company-operated  $ 768.7    $ 772.4    $ 1,538.8   $ 1,606.0
Other                               75.8       76.2       154.7       155.9
                                  $ 844.5    $ 848.6    $ 1,693.5   $ 1,761.9
Operating income (loss):
U.S. RadioShack company-operated  $ 39.4     $ 72.0     $ 100.6     $ 163.3
Other                               3.3        6.0        11.6        14.4
                                    42.7       78.0       112.2       177.7
Unallocated                         (84.1)     (92.1)     (172.1)     (184.7)
Operating loss                      (41.4)     (14.1)     (59.9)      (7.0)
Interest income                     0.3        0.3        0.7         0.8
Interest expense                    (14.1)     (12.9)     (29.1)      (26.0)
Other loss                          --         --         (0.3)       --
Loss from continuing operations   $ (55.2)   $ (26.7)   $ (88.6)    $ (32.2)
before income taxes

SOURCE RadioShack Corporation

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