Consumer credit increases for third straight month
Washington, D.C. — A report released Tuesday by the Federal Reserve said that U.S. consumer borrowing rose in December for a third consecutive month, led by the first increase in credit-card charges in more than two years as holiday sales improved.
Credit rose by $6.1 billion to $2.41 trillion after increasing a revised $2.02 billion in November, according to Federal Reserve data. Economists projected a $2.4 billion increase, according to the median forecast in a Bloomberg News survey. Borrowing remains below the peak of $2.58 trillion in July 2008. For all of 2010, credit contracted.
A thawing of credit makes it more likely that consumer spending, which accounts for about 70% of the economy, will keep increasing after climbing last quarter at the fastest pace in four years, according to Bloomberg.
For all of 2010, credit decreased 1.6% after falling 4.4% in 2009, which was the biggest decline since records began in 1942.
Revolving debt, which includes credit cards, rose $2.32 billion in December, the first gain since August 2008, according to the Federal Reserve data.
Performance Bicycle announces six new store openings
Chapel Hill, N.C. — Performance Bicycle, the nation’s largest specialty bike retailer, announced that in April it will open six new stores in four states nationwide.
The expansion includes stores in Sacramento and Berkeley, Calif.; Dallas/Fort Worth and Austin, Texas; Atlanta, and the company’s first ever store in Idaho, in Boise.
These six locations join Performance Bicycle’s 94 existing stores.
Hhgregg Q3 net income surges
Indianapolis — Appliance and electronics retailer Hhgregg reported Tuesday that net income for the quarter ended Dec. 31 rose 18.4% to $26.9 million, compared with $22.7 million in the year-ago period.
Net sales increased 30.6% to $653.7 million. Same-stores dropped 6.2%.
For fiscal year 2011, Hhgregg updated its annual net income per diluted share guidance to a range of $1.10 to $1.15; the previous range was for net income per diluted share of $1.15 to $1.23. For the full year, the company expects a net sales increase of 36% to 37%, updated from a previous assumption of a net sales increase of 38% to 40%. The company expects a comparable-store sales decline of negative 5% to negative 4%, updated from a previous assumption of comparable-stores sales decline of negative 3% to negative 1%.
Hhgregg is one retailer that has reaped the benefits of Circuit City’s demise. The company continues to expand — opening four new stores in the third quarter and planning to open a total of 43 stores in fiscal 2011 — while other retailers have curbed store growth.
“We remain confident in our ability to continue to gain market share as we enter new markets and move closer to becoming a national retail chain,” said Dennis May, president and CEO.
And Hhgregg seems to be well on its way to achieving that goal. The company currently operates174 stores in Alabama, Delaware, Florida, Georgia, Indiana, Kentucky, Maryland, Mississippi, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee and Virginia.