Boston, MA 04\/21\/2014 (wallstreetpr) \u2013\u00a0RadioShack Corporation (NYSE:RSH) <\/b>plans to close some of the stores without the approval of its lenders. In last month, the retailer announced to close nearly 1,100 stores and now targeting only 200. But, some lenders believe that the number may increase by 2,000. The uncertainties are revolving around the number of store to close, and the disagreement between lenders and RadioShack had a bad impact on the stock performance. Therefore, the stock was down by 17% and closed at lowest price of $1.41 since 1980.<\/p>\n
Why to close the stores<\/b><\/p>\n
RadioShack\u2019s sales are decreasing on a regular basis since 2010. The prime reason was due to the departure of top executives, high competition in the electronic market and loss of brand image due to change in logo.<\/p>\n
In recent quarter (4Q2013), RadioShack Corporation (NYSE:RSH) reported weak earnings with a net loss of $191.4 million, or $1.90 a share, compared to the net loss of $63.3 million, or $0.63 in 4Q2012. Sales were down by 20.1% to $935.4 million compared to prior year sales of $1.17 billion. Despite the holiday season, the retailer failed to create demand among customers.<\/p>\n
The disappointing results with a huge loss and drop in sales become a big concern for the retailer over its long term visibility in the U.S.<\/p>\n
Factors that further set the retailer down<\/b><\/p>\n
Overall, the consumer electronic market witness slow growth that creates more pressure among retailers. RadioShack\u2019s peers also posted weak sales despite a holiday season. Factors like intense competition from private labels, heavy discounting, moderate demand for mobile phones and poor shopping habit over electronic gadgets put the market on a slow pace. Moreover, RadioShack is unsuccessful to attract more customers through the retailer has a solid presence across the U.S.<\/p>\n
RadioShack also failed to generate cash from its operation due to huge net loss and declining sales trend. So, it becomes doubtful for the Company to manage its liquidity if the trends continue. As of December 31, 2013, RadioShack Corporation (NYSE:RSH) has total liquidity of $554.3 million. It includes a cash balance of $179.8 million and available credit of $374.5 million. Overall, total debt to the Company was $614 million and expects to mature by 2018 and 2019.<\/p>\n","protected":false},"excerpt":{"rendered":"
Boston, MA 04\/21\/2014 (wallstreetpr) \u2013\u00a0RadioShack Corporation (NYSE:RSH) plans to close some of the stores without the approval of its lenders. In last month, the retailer […]<\/p>\n","protected":false},"author":15,"featured_media":16567,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":{"twitter_2902945987_2902945987":""},"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[263],"tags":[1253,4857],"stock_ticker":[],"class_list":["post-19881","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-technology","tag-nysersh","tag-radioshack-corporation-nysersh","entry"],"acf":[],"yoast_head":"\n