Mark Riddix

Retail Bright Spots This Holiday Season

The past quarter the company had a 2 million dollar profit compared to a 4 million dollar loss previously. The company would have been profitable if not for the losses from Texas. The higher gross margins are encouraging because it demonstrates that management is becoming increasingly efficient. The company is getting a better handle on operating expenses. Distribution and transportation costs have remained flat.
I can't speak for the reasons that the company's strategy failed to work in Texas. Management has to be held accountable for that. I do take solace in the fact that 90 percent of their revenue is generated outside of Texas.


On Dec 03 10:07 AM brombonz wrote:

> I'm aware of the Texas situation. It has not been the only problem.
> I've followed the company since its IPO. It would be correct to say
> it is positioned properly to benefit from economic bad times. It
> is another thing to say management can turn that into profit, and
> increasing profit at that. I don't know that they have overcome their
> warehouse/distribution problems. I lived in L.A. for 35 years and
> am quite familiar with the stores. I last shopped there in the summer
> of 2006 while vacationing from my current home in Florida. I've been
> a shareowner at various times, as recently as earlier this year.
> Since I liked the stores (all the locations I've been familiar with,
> have been jammed with shoppers), the great appeal to me had been
> the exceedingly small store base compared with DLTR, FDO and the
> former DG, and the potential for national expansion. The failure
> in TX has lessened, if not eliminated, that appeal. It remains to
> be seen if management can transcend its previous shortcomings and
> turn steady, possibly growing, revenues into profit.