Hechinger Co. absorbed a third consecutive month of poor sales, the Landover-based home improvement chain reported yesterday, all but conceding that spring, its most important season, was wiped out.
Overall sales in June dropped 8 percent to $255 million, compared with the same month last year. June sales in stores open at least a year fell 7 percent, after declines of 8 percent in May and 10 percent in April.
"We've had a difficult spring," Vice President Richard S. Gross said. "Basically, spring did not happen for us."
Weak housing, poor weather and growing competition from Atlanta-based Home Depot Inc., among other home-improvement chains, have hurt Hechinger, according to analysts.
"What you have right now is a very competitive marketplace, and it's only going to get more competitive," said Kenneth Lucas of Johnston, Lemon & Co. in Washington, D.C. "Hechinger has done what it can to counteract that by going to the larger store formats . . . So what can Hechinger do? What they're doing." Yet in the short-term, Mr. Lucas said, he is not confident in the company's stock price and is considering lowering his already modest annual earnings estimate of 35 cents per share.
The company, which operates 66 Hechinger stores and 50 Home Quarters Warehouse stores in 21 states and Washington, suffered an 11 percent decline, from $124.3 million to $110.2 million, in sales at its Hechinger Store division. Same store sales dropped 5 percent.
Results were no better at the company's Home Quarters Warehouse stores, where sales dropped 6 percent, from $154.2 million to $144.8 million. Same store sales dropped 10 percent.
For the first quarter ended April 29, the company earned 3 cents per share, down 75 percent from what it earned in the same period last year.
Hechinger Class A shares yesterday closed at $7.31, unchanged.