Conn’s, Inc. (NASDAQ: CONN) (“Conn’s” or the
“Company”), announced today that President and Chief
Executive Officer Chandra Holt has stepped down from her position
and from the Company’s Board effective immediately.
“It has been an honor to lead Conn’s and our employees since
August 2021, through several challenges in the retail sector and
the broader economy. I am proud of the work this dedicated team of
over 3,500 strong employees continues to deliver towards growing
and serving the Conn’s customers with excellence and thank them for
their support during my tenure,” said Ms. Holt.
“On behalf of the Board, I want to thank Chandra for her
leadership and her contributions to the Company,” said Bob Martin,
Conn’s lead independent director on behalf of the Board of
Directors.
Effective immediately, Norman L. Miller will serve as Interim
President and Chief Executive Officer. Mr. Miller was the Company’s
former President and Chief Executive Officer from September 2015 to
August 2021 and Executive Chairman from August 2021 until April
2022, and has been a member of the Board of Directors since
September 2015. Mr. Miller is a retail and consumer finance
industry veteran and executive with over 30 years of experience at
corporations including Sears, DFC Global Corp, Aramark, Nestle and
Kraft. Mr. Miller will continue to serve as a member of the Board
of Directors.
“The Board is pleased to welcome Norm back as Interim President
and Chief Executive Officer. Norm’s deep familiarity with Conn’s
business model and past successes ensures a seamless transition.
During his previous tenure, Norm stabilized the Company’s retail
and credit operations, grew its store footprint, and guided the
Company profitably through several unprecedented challenges
including the global pandemic in 2020 and 2021. Norm produced
several record setting years of profitable growth, while serving as
President and Chief Executive Officer,” said Mr. Martin.
Mr. Miller stated, “I am excited to return to Conn’s and help
the Company reestablish its core customer value proposition. Our
differentiated credit offerings power a compelling model that we
believe is needed now more than ever as consumers across the
country are impacted by record inflation and growing economic
uncertainty. On behalf of Conn’s Board of Directors and leadership
team, we are focused on turning around our financial and operating
performance to create lasting value for our customers, communities,
team members, and shareholders.”
“Under Mr. Miller’s previous tenure as President and Chief
Executive Officer, the Company’s operating margins increased from
7% to 12% helping drive a 40% increase in the Company’s book value.
Additionally, annual credit segment income before taxes improved
from negative $100 million to a positive $65 million, and eCommerce
sales increased from less than 1% of total retail sales to over 5%
of retail sales during his previous tenure. On behalf of the Board,
we look forward to supporting Norm and Conn’s leadership team, as
we work together to execute on the Company’s growth initiatives,”
concluded Mr. Martin.
Update on Fiscal Year 2023 Third Quarter
Performance
Conn’s remains challenged by macroeconomic headwinds, which is
impacting consumer spending and disproportionately affecting
year-over-year sales to the Company’s financial access customer
segment and sales of discretionary product categories. As a result,
the Company currently expects total revenue for the fiscal year
2023 third quarter to be down 21% to 23%. In addition, Conn’s
expects operating margin for the fiscal year 2023 third quarter to
be negative mid-single digits.
The Company is focusing on improving margins and reducing or
eliminating unnecessary costs. Conn’s will provide complete third
quarter results in early December. Final third quarter results may
differ from the descriptions above once the quarter is fully
closed.
Outlook
As part of the leadership change, and continued macroeconomic
and retail uncertainty, Conn’s has withdrawn its previous fiscal
year 2023 financial guidance. Management expects to update
investors further when the Company reports third quarter results in
early December.
About Conn’s, Inc.
Conn's HomePlus (NASDAQ: CONN) is a specialty retailer of home
goods, including furniture, appliances and consumer electronics,
with a mission to elevate home life to home love. With over 160
stores across 15 states and online at Conns.com, our over 3,500
employees strive to help all customers create a home they love
through access to high-quality products, next-day delivery and
personalized payment options, including our flexible, in-house
credit program. Additional information can be found by visiting our
investor relations website at https://ir.conns.com and social
channels (@connshomeplus on Twitter, Instagram, Facebook and
LinkedIn).
This press release contains forward-looking
statements within the meaning of the federal securities laws,
including but not limited to, the Private Securities Litigation
Reform Act of 1995, that involve risks and uncertainties. Such
forward-looking statements include information concerning our
future financial performance, business strategy, plans, goals and
objectives. Statements containing the words “anticipate,”
“believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,”
“project,” “should,” “predict,” “will,” “potential,” or the
negative of such terms or other similar expressions are generally
forward-looking in nature and not historical facts. Such
forward-looking statements are based on our current expectations.
We can give no assurance that such statements will prove to be
correct, and actual results may differ materially. A wide variety
of potential risks, uncertainties, and other factors could
materially affect our ability to achieve the results either
expressed or implied by our forward-looking statements, including,
but not limited to: general economic conditions impacting our
customers or potential customers; our ability to execute periodic
securitizations of future originated customer loans on favorable
terms; our ability to continue existing customer financing programs
or to offer new customer financing programs; changes in the
delinquency status of our credit portfolio; unfavorable
developments in ongoing litigation; increased regulatory oversight;
higher than anticipated net charge-offs in the credit portfolio;
the success of our planned opening of new stores; expansion of our
e-commerce business; technological and market developments and
sales trends for our major product offerings; our ability to manage
effectively the selection of our major product offerings; our
ability to protect against cyber-attacks or data security breaches
and to protect the integrity and security of individually
identifiable data of our customers and employees; our ability to
fund our operations, capital expenditures, debt repayment and
expansion from cash flows from operations, borrowings from our
Revolving Credit Facility, and proceeds from accessing debt or
equity markets; the effects of epidemics or pandemics, including
the COVID-19 pandemic; and other risks detailed in Part I, Item 1A,
Risk Factors, in our Annual Report on Form 10-K for the fiscal year
ended January 31, 2022 and other reports filed with the Securities
and Exchange Commission. If one or more of these or other risks or
uncertainties materialize (or the consequences of such a
development changes), or should our underlying assumptions prove
incorrect, actual outcomes may vary materially from those reflected
in our forward-looking statements. You are cautioned not to place
undue reliance on these forward-looking statements, which speak
only as of the date of this press release. We disclaim any
intention or obligation to update publicly or revise such
statements, whether as a result of new information, future events
or otherwise, or to provide periodic updates or guidance. All
forward-looking statements attributable to us, or to persons acting
on our behalf, are expressly qualified in their entirety by these
cautionary statements.
CONN-G
S.M. Berger & Company
Andrew Berger (216) 464-6400
Conns (NASDAQ:CONN)
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