Conn's, Stung by Pandemic, Focuses Online; Stock Down

Not all retailers got a quarterly sales assist from the pandemic, even as they shift online where shoppers are spending more money. Conn’s reported sales fell 8.6% to $279.7 million from the year-ago period. Same-store sales dropped 13.2% for the quarter ended July 31. Chief Operating Officer Lee Wright on a Thursday investor call said sales could be affected through the fiscal year. CEO Norm Miller said there are opportunities geographically and with different customer segments to “take appropriate risk for the back half of the year,” but the company is being “quite cautious as we go forward, with unemployment still at double digits and unknown what’s going to happen, having obviously never been through a pandemic.” There wasn't Q3 guidance. Shares closed down 16% to $11.52. Conn’s had a deceleration after stimulus from the Coronavirus Aid, Relief and Economic Security Act waned at the end of July, said Wright. Consumer electronics sales fell 11.7%. In response to what it sees as lasting changes in buying habits, Conn’s is accelerating digital investment. It launched an e-commerce platform last year and upgraded its website, resulting in 72% e-commerce growth in the quarter. Online was 2%-3% of the balance of sale in Conn’s credit portfolio in Q2, up 70%. It can ultimately be 10%, said Miller.