For the fourth quarter, Aaron’s, Inc. posted a revenue increase of 37% to $759.7 million versus the 2013 period but comparable store revenues in the core, company-operated business decreased 2.8%, year over year. Net earnings came in at $22.1 million versus $22.7 million a year ago, and diluted earnings per share were 30 cents in both periods.
Analysts polled by Zacks expected diluted earnings per share of 36 cents.
For the 12 months ended December 31, 2014, revenues increased 22% to $2.73 billion compared to $2.24 billion for the year ended December 31, 2013. Net earnings were $78.2 million versus $120.7 million in the year earlier while diluted earnings per share were $1.08 for 2014 compared to $1.58 in 2013.
The company stated that the $205.9 million increase in the fourth quarter 2014 came from $220.8 million in revenue from Progressive Leasing, acquired in April 2014, partially offset by a decrease in revenue from Aaron’s core business.
John Robinson, Aaron’s CEO, stated, “As we look at Aaron’s today, we believe we have the right blend of assets to grow this company into a true omnichannel lease purchase provider. Aaron’s people, technology, brand, customer-base, retail relationships, store footprint, distribution network and manufacturing assets uniquely position us to execute this strategy. The growth of Progressive, driven by invoice volume growth at both new and existing retail doors, continues to exceed our expectations. We are continuing to invest in infrastructure to support our strong customer and retailer growth. We are also investing in our product to improve the efficiency of the process at the point of sale and to expand our offering to enable us to serve more customers.”
He acknowledged, “Aaron’s traditional store-based business has not performed at a level that is satisfactory over the past few years. I have a high sense of urgency about improving our top-line, correctly aligning our cost structure and managing the business for cash efficiency. While a number of initiatives are underway, including the realization of $50 million in annual cost savings, I am keenly focused on addressing each of these issues and will consider all options to improve our store-based operations.”
As of December 31, 2014, Aaron’s included 2,108 stores, including 1,243 company-operated Aaron’s Sales & Lease Ownership stores, 780 franchised Aaron’s Sales & Lease Ownership stores, 83 company-operated HomeSmart stores and two franchised HomeSmart stores.