Best Buy Fourth-Quarter Comparable Store Sales Increase 9.7 Percent.Business Editors MINNEAPOLIS--(BUSINESS WIRE)--March 4, 2004 Revenue increases 21% to $8.44 billion; Company expects Q4 earnings from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the at the high end of its range
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Fourth-Quarter Revenue Summary - Fiscal 2004
(U.S. dollars in billions)
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Comparable Store
Revenue Revenue Gain Sales Gain(1)
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Continuing Operations $8.44 21% 9.7%
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Domestic $7.60 19% 9.9%
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International $0.84 46%(2) 7.9%
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Fiscal 2004 Revenue Summary
(U.S. dollars in billions)
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Comparable Store
Revenue Revenue Gain Sales Gain(1)
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Continuing Operations $24.54 17% 7.1%
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Domestic $22.22 15% 7.4%
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International $2.32 41%(2) 4.7%
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Note: All periods presented reflect the classification of Musicland's
financial results as discontinued operations.
(1) Comprised of revenue at stores and Internet sites operating for at
least 14 full months, as well as remodeled and expanded locations.
Relocated stores are excluded from the comparable store sales
calculation until at least 14 full months after reopening.
Acquired stores are included in the comparable store sales
calculation beginning with the first full quarter following the
first anniversary of the date of acquisition. The calculation of
the comparable store sales gain excludes the impact of
fluctuations in foreign currency exchange rates.
(2) The effect of changes in foreign currency exchange rates accounted
for approximately half of the international segment's revenue
increase for both the fourth quarter and the fiscal year.
Best Buy Co., Inc. (NYSE NYSE See: New York Stock Exchange :BBY BBY Best Buy (stock symbol) BBY Before Battle of Yavin (Star Wars) BBY BeBeyond (Chinese online community) ) today reported a 21-percent increase in revenue from continuing operations to $8.44 billion for the Company's fiscal 2004 fourth quarter, which ended on Feb. 28, 2004. This total compares with revenue of $6.99 billion for the Company's fiscal 2003 fourth quarter, which ended on March 1, 2003. Drivers of the increase included a strong comparable store sales gain and the addition of 78 new stores in the past 12 months. Comparable store sales increased 9.7 percent for the fourth quarter of fiscal 2004, higher than the Company's guidance at the beginning of the quarter of a 6- to 8-percent gain. The Company previously reported a comparable store sales gain of 9.3 percent for the fiscal month of December. "Customer traffic accelerated in the second half of December and sustained that pace through the rest of the quarter," said Brad Anderson Anderson, river, Canada Anderson, river, c.465 mi (750 km) long, rising in several lakes in N central Northwest Territories, Canada. It meanders north and west before receiving the Carnwath River and flowing north to Liverpool Bay, an arm of the Arctic , vice chairman and chief executive officer. "Effective advertising and promotional campaigns attracted customers, and our employees followed through with great customer service. Redemption of gift cards and Reward Zone certificates brought customers back into the stores after the holiday season, and our stores were ready for them with superior assortments and improved in-stock levels compared with last year. These results complete a very strong year for the Company." U.S. Best Buy stores posted a fourth-quarter comparable store sales gain of 9.9 percent, reflecting increased customer traffic at existing stores and exceptional in-store execution. The nation's largest retailer of consumer electronics said it believes it gained market share, particularly in notebook and desktop computers, digital cameras and digital televisions. Magnolia Audio Video Magnolia Audio Video is a specialty consumer electronics retailer in the United States. It currently operates 13 standalone stores throughout Washington, Oregon, and California. , which operates high-end consumer electronics stores on the West Coast, reported a fourth-quarter comparable store sales gain of 3.4 percent. The Company's Canadian stores Grocery Stores
For the 2004 fiscal year, total revenue rose 17 percent to $24.54 billion, compared with $20.95 billion for fiscal 2003. Comparable store sales increased 7.1 percent for the fiscal year. In late February, the Company opened eight new U.S. Best Buy stores. At the end of the fiscal year, the Company operated 608 U.S. Best Buy stores, 108 Future Shop stores in Canada, 19 Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. Best Buy stores and 22 Magnolia Audio Video stores. (For square footage and store concept information, please refer to www.BestBuy.com and click on "For Our Investors.") Company Expects Fourth-Quarter Earnings Solidly At The High End Of Its Range Given the revenue results for the quarter, the Company said that it now expects fourth-quarter earnings from continuing operations to be solidly at the high end of its guidance of $1.34 to $1.39 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share. For the first three quarters, the Company had earnings from continuing operations of $1.01 per diluted share; accordingly, the Company now said it estimates fiscal 2004 earnings from continuing operations solidly at the high end of its prior range of $2.35 to $2.40 per diluted share. "We outperformed our expectations for revenue growth for the fourth quarter, driven by increased store traffic, particularly in computers," added Darren Jackson Darren Jackson (born 25 July 1966 in Edinburgh) is a former Scottish professional footballer. Career Jackson played for Meadowbank Thistle, Newcastle United, Dundee United, Hibernian, Celtic, Coventry City, Hearts, Livingston, St. Johnstone and Clydebank. , executive vice president - finance and chief financial officer. "Our effective promotional strategies, combined with efficiency initiatives, helped us gain market share while modestly improving our operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. rate." Largest Revenue Gain Comes From Home Office Product Category The Company's revenue mix from continuing operations, by major product category, is shown below.
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Fourth Quarter Ended Fiscal Year Ended
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Product Category Feb. 28, March 1, Feb. 28, March 1,
2004 2003 2004 2003
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Consumer Electronics 38% 38% 37% 37%
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Home Office 33% 32% 35% 34%
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Entertainment Software 25% 25% 22% 23%
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Appliances 4% 5% 6% 6%
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Total 100% 100% 100% 100%
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The consumer electronics category had a comparable store sales gain in the high single digits. It contributed the largest percentage of revenue for the fiscal fourth quarter, maintaining its relative position in the revenue mix. Consumers continue to increase their purchases of advanced televisions, including plasma, LCD (Liquid Crystal Display) A display technology that uses rod-shaped molecules (liquid crystals) that flow like liquid and bend light. Unenergized, the crystals direct light through two polarizing filters, allowing a natural background color to show. and digital televisions. Digital cameras and accessories and digital camcorders also demonstrated outstanding revenue growth as consumers continued to migrate to digital imaging. These products led the video subcategory sub·cat·e·go·ry n. pl. sub·cat·e·go·ries A subdivision that has common differentiating characteristics within a larger category. to a low-double-digit gain, partially offset by a slight decline in the audio subcategory. The home office category posted a comparable store sales gain in the mid-teens and increased in the revenue mix compared with the prior year's fourth quarter. Comparable store sales from computers increased by the strong double digits Double Digits was a pricing game on the American television game show, The Price Is Right. Played from April 20, 1973 through May 18, 1973's show, it was played for a car and used small prizes. . Consumers favored the portability of notebook computers A laptop computer that weighs in a range from five to seven pounds. The term originated when laptops were routinely more than 10 pounds, and those that became lighter were placed in a special "notebook" category. In practice, notebook computer and laptop computer are synonymous. , and they also appreciated the functionality of the desktop computer as a media server. Comparable store sales of MP3 devices showed triple-digit growth as more consumers grew to understand the convenience of those devices. The entertainment software category maintained its relative position in the revenue mix with a high-single-digit comparable store sales gain. Comparable store sales of both DVDs and CDs grew by the double digits, driven by compelling new releases and a deeper assortment assortment /as·sort·ment/ (ah-sort´ment) the random distribution of nonhomologous chromosomes to daughter cells in metaphase of the first meiotic division. as·sort·ment n. of older titles. Top-selling DVDs included Pirates of the Caribbean This article is about the franchise. For other, more specific uses, see Pirates of the Caribbean (disambiguation). For real pirates, see Piracy in the Caribbean. Pirates of the Caribbean , Finding Nemo, Bad Boys2 and Seabiscuit, while CDs from Outkast, Evanescence ev·a·nesce intr.v. ev·a·nesced, ev·a·nesc·ing, ev·a·nesc·es To dissipate or disappear like vapor. See Synonyms at disappear. [Latin and Linkin Park were among the most popular music titles. The Company's exclusive Rolling Stones Rolling Stones, English rock music group that rose to prominence in the mid-1960s and continues to exert great influence. Members have included singer Mick Jagger (Michael Phillip Jagger), 1943–; guitarists Brian Jones DVD DVD: see digital versatile disc. DVD in full digital video disc or digital versatile disc Type of optical disc. The DVD represents the second generation of compact-disc (CD) technology. set, Four Flicks Four Flicks is a 4 disc DVD released by The Rolling Stones. It was exclusively marketed to Best Buy stores only. The collection documents several of the Stones' shows from their 2002-2003 Licks World Tour. , also aided the increase in music revenue. The appliance category declined slightly in the revenue mix, reporting a comparable store sales gain in the mid-single digits. Revenue growth reflected an expanded assortment; strong new products, especially in front-load laundry Laundry can be:
Before industrialization ; and a successful promotional campaign. Best Buy is scheduled to release its fiscal fourth-quarter earnings before the stock market opens on Wednesday, March 31. Its earnings conference call is scheduled to begin at 10 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy on March 31 and is expected to be available on its Web site both live and after the call, at www.BestBuy.com. Investors may access the call by clicking on "For Our Investors." Statements made in this news release, other than those concerning historical financial information, should be considered forward-looking and subject to various risks and uncertainties. Such forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. are based on management's beliefs and assumptions regarding information currently available, and are made pursuant to the "safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " provisions of Section 27A of the Securities Act of 1933, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. , and Section 21E of the Securities Exchange Act of 1934, as amended. The Company's actual results could differ materially from those expressed in the forward-looking statements. Factors that could cause results to vary include, among others, those expressed in the Company's filings with the Securities and Exchange Commission. The Company has no obligation to publicly update or revise any of the forward-looking statements that may be in this news release. About Best Buy Co., Inc. Minneapolis-based Best Buy Co., Inc. (NYSE:BBY) is North America's leading specialty retailer of consumer electronics, personal computers, entertainment software and appliances. The Company's subsidiaries operate retail stores and/or Web sites under the names: Best Buy (BestBuy.com), Future Shop (FutureShop.ca), Geek Squad The Geek Squad is a subsidiary of the Best Buy Company and is based in Richfield, Minnesota [1]. Originally founded in 1994 by Robert Stephens, it offers various computer-related services and accessories for residential and commercial clients. (GeekSquad.com), and Magnolia Audio Video (Magnoliaav.com). The Company's subsidiaries reach consumers through approximately 750 stores in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and Canada. |
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