CONN's, Inc. Conference Call Highlights: Results Were 'Not Satisfactory'

CONN's, Inc. CONN reported its second-quarter earnings on Tuesday. Shares of the company are down 30 percent since opening the week.

Below are some key highlights from its conference call:

• The Retail segment had another outstanding quarter with higher gross margins, expanded operating margins and the 12 consecutive quarter of increasing same-store sales.
• Strategies to grow sales of our most profitable products lines improving, enduringly successful.
• Over the last five months, we've successfully opened an additional 14 stores in 11 markets without disrupting our retail operations.
• We are reaching customers that were underserved before, giving low-income consumers the opportunity to purchase quality, durable branded products for their homes in affordable monthly payments.
• Overall, results were not satisfactory.
• We remain confident in the business model.
• The midpoint of our revised guidance for the full year since EPS growth of 12 percent and a 17 percent return on equity.
• Same-store sales excluding air conditioning and discontinued lawn and garden category would have been 18 percent.
• Total retail gross margin percentage for the quarter was 40.8 percent, an increase of 250 basis points over the prior year.
• With each passing quarter, our retail sales shift to higher-margin categories with defensible positions against direct-to-consumer Internet retail.
• Gross margin percentage was 41 percent
• This is above our our long-term goal of 40 percent and full-year expectations of 40 percent to 41 percent.
• August same-store sales were up 3 percent.
• Last year, August same-store sales have increased 29 percent.