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Aaron's earnings up 7.1% as revenues rise 7.3%

Larry Thomas -- Furniture Today, October 25, 2011

ATLANTA — Rent-to-own powerhouse Aaron's Inc. said third-quarter earnings were 7.1% above the same quarter in 2010.

The company, which operates more than 1,900 corporate and franchised stores, said the improved results were recorded despite high unemployment and continued economic pressure among its targeted customer base.

Revenues for the quarter ended Sept. 30 rose 7.3% to $485.2 million.

Net income totaled $28 million or 36 cents per share. That's up from $26.2 million or 32 cents per share in last year's third quarter.

"We once again are seeing strong revenue gains with same-store revenues up 5.3% and same-store customer counts up 6.3% over the third quarter of last year," said Robin Loudermilk, president and CEO. "Even though these gains are outstanding considering the current economic conditions ... there is no doubt that our customers are struggling as a result of high unemployment and overall economic pressures.

"However, we believe we are successfully meeting these challenges and that business will remain good in the upcoming quarters," he added.

For the nine months ended Sept. 30, revenues rose 7.8% to $1.5 billion. Nine-month net income totaled $83.2 million or $1.05 per share. That's down from $87.6 million or $1.07 per share in last year's third quarter. This year's nine months included a one-time charge of $36.5 million for expenses related to a lawsuit.

Aaron's also revised its revenue and earnings estimates for the year. Revenues are now projected at $2.02 billion, up from its previous forecast of $2 billion, while earnings are projected at $1.73 to $1.77 per share.

The earnings projection, which doesn't include the lawsuit write-off, is roughly the same as its earlier forecast of $1.73 to $1.81 per share.

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