FORT WORTH, Texas (AP) — RadioShack Corp. reported third-quarter profit Tuesday that fell far short of expectations but announced a major share buyback program and plans to double its dividend payments.
The electronics and wireless retailer earned $300,000 for the quarter that ended Sept. 30; it broke even on a per-share basis. It earned $46 million, or 37 cents per share, in the same quarter last year.
After adjusting for several one-time items including a plant closure, the company earned $14.9 million, or 15 cents per share, in the most recent quarter.
RadioShack's total revenue rose 3 percent to $1.03 billion.
Analysts had anticipated the company report adjusted earnings of 36 cents per share on revenue of $1.03 billion, according to data from FactSet. Analyst estimates typically exclude one-time items.
RadioShack said that the quarter was a transition period during which it phased out its offering of T-Mobile products and services in its company-owned stores and prepared to launch Verizon Wireless in September. The company got a boost from new mobile service and sales centers in Target stores, which was partially offset by softer sales in its company-operated stores. The company also struggled with a decline in sales to independent dealers and sales growth in company-operated stores in Mexico.
The company said revenue at its stores and Target Mobile centers open at least a year decreased 4 percent during the quarter due to the shift away from T-Mobile, fewer sales of digital-to-analog television converter boxes and related television antennas and GPS devices, as compared to last year. Revenue at stores open at least a year is considered a key indicator of a retailer's financial health as it strips away the impact of recently opened or closed stores.
RadioShack also said that it would double its annual dividend payment to 50 cents per share, with payments beginning in the first quarter of 2012. The first payment will be made Dec. 15 to shareholders of record as of Nov. 25.
RadioShack had $667.7 million in cash as of the end of the quarter.
The retailer said it will repurchase up $200 million of its common stock over the next 12 months. The company has an estimated 99.8 million shares outstanding
RadioShack, based in Fort Worth has 4,670 company-operated stores in the United States and Mexico, 1,490 wireless phone centers in the United States and approximately 1,100 dealer outlets worldwide.
Its shares fell 58 cents, or 4.4 percent, to $12.73 in after-hours trading following the release of the earnings report.