UPDATE: Conn's Posts Downbeat Q2 Earnings, Cuts Full-Year Forecast

Shares of Conn's

tumbled more than 23% in pre-market trading after the company reported weaker-than-expected second-quarter earnings and cut its full-year forecast. Conn's posted its quarterly profit of $17.7 million, or $0.48 per share, versus a year-ago profit of $19.2 million, or $0.52 per share. Excluding one-time items, the company earned $0.50 per share. Its total revenue jumped 30% to $353 million. However, analysts were expecting earnings of $0.75 per share on revenue of $353.65 million. Total retail revenue climbed 28.8% to $288.6 million in the quarter, while credit revenue rose 37.8% to $64.3 million. Conn's same store sales rose 11.7% in the quarter, versus an 18.4% rise in the year-earlier period. During the second quarter, Conn's opened a total of 8 HomePlus® stores in several new markets and closed 1store in Louisiana and remodeled or relocated 3 other stores. Theodore M. Wright, Conn's chairman and chief executive officer said, “Overall results were not satisfactory. Our credit operations ran into unexpected headwinds, resulting in portfolio performance deterioration. Despite tighter underwriting, lower early-stage delinquency and improved collections staffing and execution, delinquency unexpectedly deteriorated across all credit quality levels, customer groups, product categories, geographic regions and years of origination. Tighter underwriting and better collections execution did not offset deterioration in our customer's ability to resolve delinquency.” For the full-year, Conn's now expects adjusted profit of $2.80 to $3 per share, versus its earlier outlook of $3.40 to $3.70 per share. Conn's shares dipped 23.02% to $34.51 in pre-market trading.