RadioShack to close up to 1,100 stores

Fort Worth, Texas -- RadioShack Corp. said it plans to close up to 1,100 stores, approximately one-fifth of its total, and also announced a disappointing holiday season and a wider quarterly loss. The shutterings will leave the chain, whose turnaround appears to be still far off, with over 4,000 locations, including more than 900 dealer franchise locations.

“Over the past few months, we have undertaken a comprehensive review of our portfolio from many angles – location, area demographics, lease life and financial performance – in order to consolidate our store base into fewer locations while maintaining a strong presence in each market,” said Joseph C. Magnacca, CEO. “The result of that review is our plan to close up to 1,100 underperforming stores.”

Joe Magnacca, a former Walgreens executive, took the helm of RadioShack in February 2013 and launched an ambitious turnaround plan to reinvigorate and reposition the struggling brand. He has said he expects the turnaround to take several quarters.

"Our brand equity remains strong, reflected in the sales growth we're seeing in our new Concept Stores, which redefine the RadioShack store experience," Magnacca said. "We have also been encouraged by the positive response to our new brand positioning around "Do It Together," which we kicked off with our award winning Super Bowl commercial. Importantly, our key hires during the fourth quarter in merchandising, global sourcing, planning and allocation and, more recently, our new chief financial officer, round out our new leadership team as we continue to re-build the business."

RadioShack attributed its poor performance in the quarter to a decline in shopper traffic, deep promotions by competitors, and weak sales in phone-and-tablets.

The chain reported a net of $191.4 million in the fourth quarter, ended Dec. 31, from $63.3 million in the year-ago period.

Sales dropped to $935.4 million in the quarter, from $1.17 billion last year. Wall Street expected revenue of $1.12 billion. Same-store sales plunged 19%.

RadioShack reported a full-year loss of $400.2 million, versus a loss of $139.4 million for the year-ago period.

Annual revenue fell 10% to $3.43 billion, from $3.83 billion.

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