Lower than expected response to holiday catalog mailings and direct response advertising; slower Internet sales and lighter retail store traffic have led Sharper Image Corp. to lower projected sales figures for its fourth quarter, which ends Jan. 31.
“Overall sales this holiday were disappointing,” said company chairman and CEO Richard Thaleimer, in a prepared statement.
Higher in-bound freight costs and a slight change in the merchandising mix towards lower margin products had an adverse impact on sales in December, according to the company.
Sharper Image reported that its December sales, through the 24th, were 4% above last year’s level. The slip in sales puts a crimp in the San Francisco-based retailer’s fourth-quarter projections, which had been initially set at 15%-18% above fourth quarter 2003.
Thalheimer said that retail sales during the 10 days leading up to Christmas were lighter than anticipated, and that Internet sales were soft, and response to the company’s holiday catalogs and direct mail solicitations were “lower than expected.”
The Sharper Image cut its earning guidance for fourth-quarter 2004 to between 94 and 99 cents per share, down from $1.40 per share in fourth-quarter 2003. The company’s full-year earnings guidance was put at between 95 and 99 cents per share, compared with $1.65 per share last year.
On Monday, Sharper Image’s stock price fell $4.18, to $18.96 per share, after the company’s announcement.
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