Rent-A-Center sales off 11.2% in Q1
In this year’s first three months, the company lost $6.7 million, compared with earnings of $25.1 million in first-quarter 2016.
Same-store sales were off 12.5% in Rent-A-Center’s core U.S. stores during the first quarter and down 6% in Mexico.
The company’s Acceptance Now lease-to-own operation first-quarter sales increased 1.8% to $234.5 million compared with the prior-year period. That increase was driven by a same-store sales increase of 2.9%.
Debt was reduced by $71.6 million in 2017’s first three months, and core U.S. store held-for-inventories were lowered 9.5% compared with first-quarter 2017.
“During the first quarter, Rent-A-Center delivered solid progress on our near-term strategies to strengthen the core U.S. business, as demonstrated by our sequential improvement in our key operating metrics and financial results,” said Mark Speese, chairman of the Rent-A-Center Board and CEO. “While we are encouraged by our recent efforts, we recognize there is still work to be done, and we remain focused on executing our comprehensive strategic plan to restore growth and improve profitability over the long-term. Given the portfolio nature of the business, it will take time for the actions we are implementing to be fully realized in our results. However, the Rent-A-Center Board and management are confident that we are taking the right steps to deliver enhanced value for all Rent-A-Center stockholders.”
Regarding the strengthening of core U.S. business, the company implemented a new competitive value proposition that is intended to increase demand and retention, and improve the customer experience. Rent-A-Center also identified and began to execute on a new assortment strategy aimed at shifting towards more higher-end aspirational products. There was also a continued heightened focus on improving the quality of the portfolio through best practices and better execution in account management. Lastly, the company developed and deployed a more focused approach to training and development enabling consistent execution, strengthening of customer relationships and reducing co-worker turnover.
Rent-A-Center operates around 2,600 stores in the United States, Mexico, Canada and Puerto Rico. Acceptance Now has around 1,500 kiosk locations in the United States and Puerto Rico.