Newspaper article THE JOURNAL RECORD

CD Warehouse Reports Net Loss for Quarter

Newspaper article THE JOURNAL RECORD

CD Warehouse Reports Net Loss for Quarter

Article excerpt

OKLAHOMA CITY (JR) -- CD Warehouse on Monday reported a net loss for the second quarter as new store openings and development of an e- commerce Web site inflated costs.

The second quarter also yielded record increases in systemwide sales, same-store sales, store count, total revenues and royalty revenues.

The net loss for the quarter totaled $144,000, or 4 cents per share, compared with net income of $75,000, or 3 cents per share, for the second quarter of 1998.

Revenues for the second quarter were $7.68 million, up 176 percent from $2.79 million a year earlier.

For the first six months of 1999, Oklahoma City-based CD Warehouse had a net loss of $75,000, or 2 cents per share, compared with net income of $236,000, or 10 cents per share, for the first six months of 1998.

Revenues for the six-month period were $14.1 million, up 133 percent from $6.05 million a year earlier.

Systemwide sales, which include sales from franchised stores, were $18.79 million for the second quarter, up 53 percent from $12.3 million for the second quarter of 1998. For the six months ended June 30, systemwide sales were $35.68 million, up 48 percent from a year earlier.

The increase in systemwide sales was attributable to the development of new stores, as well as increases in same-store sales, said Jerry W. Grizzle, CD Warehouse's chairman and CEO.

Same-store sales for the second quarter were $13.58 million, up 17 percent from the second quarter of 1998. The increase marked the 10th consecutive quarter of same-store sales increases, nine of which have been double-digit increases.

Same-store sales for the six-month period were $25.8 million, up 16 percent from a year earlier.

Royalty revenue for the second quarter was $936,000, up 96 percent from $479,000. For the six-month period ended June 30, royalty revenue was $1.86 million, up 95 percent from $957,000 for the same period in 1998. "It is difficult to report the tremendous accomplishments of our retail operations and then have to overshadow those accomplishments by reporting a loss for the quarter," Grizzle said. …

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