CompUSA 2009 Annual Report Download - page 80

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NET SALES
SEGMENTS:
The growth in Technology products sales in 2009 is attributable to increased retail and internet sales in the consumer channel, opening
5 retail stores and the two acquisitions completed during 2009. Sales attributable to Circuit City and WStore Europe SA and
subsidiaries (acquired in the second and third quarters of 2009, respectively) totaled approximately $131.1 million for the year. On a
constant currency basis, translating 2009 foreign results at 2008 exchange rates, sales would have grown 10.5%. or $120.9 million.
Adjusting for the impact of the number of weeks, Technology products sales increased 8.3% for the year.
North American technology products sales increased 14.3% in 2009 compared to 2008 benefiting from the opening of 5 retail stores
and the Circuit City acquisition which contributed $67.3 million in sales. On a constant currency basis, translating 2009 Other North
America results at 2008 exchange rates, North American technology products sales would have grown to 15.2%. The movement in the
exchange rates negatively impacted sales by approximately $17.3 million. Adjusting for the impact of the number of weeks, North
American technology products sales increased 16.7%.
European technology products sales declined 9.8% to $848.5 million as the result of slower business to business sales. The trend of
declining sales in Europe is expected to reverse as global economic conditions improve and as a result of the WStore acquisition. Sales
attributable to the WStore acquisition totaled approximately $63.8 million in 2009. On a constant currency basis, translating 2009
foreign results at 2008 exchange rates, European sales would have increased 1.2%. The movement in foreign exchange rates
accounted for $103.6 million of the revenue decline in Europe for the year. Adjusting for the impact of the number of weeks,
European sales would have declined 8.3%.
The decline in Industrial products sales is attributable to the slowdown in business to business economic activity which started in the
second half of 2008 and continued into 2009. Adjusting for the impact of the number of weeks, Industrial products sales decreased
15.9%. The Company has implemented strategies to improve sales growth such as expanding its product offerings and launching an
improved customer website.
The Company announced plans to exit its Software solutions segment during the second quarter of 2009. As of December 31, 2009
substantially all of the third party business activities of ProfitCenter Software had ended.
GEOGRAPHIES:
North American sales increased 10.8% to $2.3 billion compared to 2008. North American sales benefited from increased retail and
internet sales in the consumer channel, opening 5 retail stores and the Circuit City acquisition, which contributed $67.3 million of
sales offset by the declining sales in the Industrial products segment. On a constant currency basis, translating 2009 Other North
America results at 2008 exchange rates, North American sales would have grown to 11.6%. The movement in the exchange rates
negatively impacted sales by approximately $17.3 million. Adjusting for the impact of the number of weeks, North American sales
increased 13.1%.
European technology products sales declined 9.8% to $848.5 million. On a constant currency basis, European sales would have
increased 1.2%. Sales attributable to the WStore acquisition totaled approximately $63.8 million for the year. Movement in foreign
exchange rates accounted for $103.6 million of the sales decline in Europe for the year. The trend of declining sales in Europe is
expected to reverse as global economic conditions improve and as a result of the WStore acquisition.
Worldwide consumer-channel revenue, defined as revenues from retail stores, consumer websites, inbound call centers and, shopping
channels, were $1.8 billion compared to $1.6 billion in the same period in 2008, an increase of 12.2%. Growth was driven primarily
by volume increases in computers, including laptops and netbooks and consumer electronics, including televisions. Worldwide
business to business channel sales were $1.3 billion for 2009 compared to $1.4 billion in the prior year, a 4.9% decrease. Worldwide
business to business sales declined as the result of the global economic slowdown. The acquisition of WStore in September 2009
partially offset the decline.
2008 vs. 2007:
Sales increased in all reporting business segments and in both geographies during 2008 over 2007. The growth in Technology
Products sales increase was driven by increased internet and retail store sales as the result of the acquisition of the CompUSA. The
growth in Industrial Products sales resulted from the Company increasing its market share through aggressive acquisition of customers
via web and catalog advertising. Sales attributable to CompUSA web and retail were $226.3 million for the year. In Europe sales
increased .9% compared to 2007. Movements in foreign exchange rates positively impacted the European sales comparison by
approximately $13 million for the year. Excluding exchange rate benefits, European sales would have been flat year over year. Sales
in Canada (Other North America) increased by 13.9% compared to the prior year. Excluding exchange rate benefits, sales would have
increased 10.9% for the year. As in the United States, sales slowed in the second half of 2008 in Europe and Canada for both