Retail giant Aaron’s travails with coaxing customers into stores continued in the second quarter, months after the company avoided a $2.3 billion unsolicited takeover by its second-largest shareholder.
Same-store foot traffic dropped 2.8 percent, even with a promotion giving away furnishings on daytime TV personality Wendy Williams’ show late in the quarter. The campaign was meant to boost the brand’s visibility and create buzz.
Overall profit slumped by more than 67 percent to $8.5 million.
“While we are excited about our future prospects, we are not pleased with the performance of our core business,” Chief Executive Officer Ron Allen said.
SunTrust analyst David Magee, in research notes released earlier in the month, said he didn’t know why Aaron’s foot-traffic problems are intensifying.
“While traffic is obviously an issue, it is less clear as to why the softness seems to be getting worse at (Aaron’s),” Magee wrote.
The company, which has more than 13,000 employees, reiterated on Friday a plan unveiled in April to reshape its business. Those plans include closing as many as 44 stores in the third quarter, cutting $10 million in operating expenses and improving Aaron’s online presence.
The company’s remake of its leadership, which began earlier in the year, continued. Chief Operations Officer Dave Buck, who has been with the company for 25 years, announced Thursday he plans to retire. The company said his position would be eliminated.
The bright spot in the quarter was revenue, which climbed 22 percent, the company reported. That uptick, however, largely came from about $139 million infusion from online lender Progressive Finance, which Aaron’s bought for $700 million in April.
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