Egghead Losses Continue To Narrow

Egghead Inc. Thursday reported a second quarter loss of $4.9 million, or 24 cents per share, on sales of $63.3 million. That compares to an after-tax loss of $4.7 million, or 27 cents per share, on sales of $80 million during last year’s second quarter.

Those comparisons, though, reflect one-time charges of about $1.5 million associated with Egghead’s acquisition of Surplus Direct Inc. The fiscal 1998 second-quarter sales figures also represent Surplus Direct sales for the six weeks of the quarter that followed the acquisition.

When comparing Egghead’s second-quarter 1997 operations to its non-Surplus Direct operations during that period of the current year, Egghead cut its losses from $7.3 million to $2.6 million. Under this comparison, Egghead’s sales declined to $55 million during the second quarter of fiscal 1998 from $80 million the previous year. But those figures reflect closing 70 retail outlets during the intervening period.

“Egghead’s year-over-year pre-tax operating losses have decreased by $12 million in the first two fiscal quarters, indicating management’s ongoing commitment to repositioning the company and turning it around,” George Orban, Egghead’s chairman and chief executive officer, said in a news release.

Egghead officials say they are optimistic about the critical holiday season, but expressed concern that the company’s advertising expenses could be higher this year.

Egghead is a computer hardware and software reseller headquartered in Spokane. It currently operates 85 retail stores, two Internet catalog site and an Internet auction site.

, DataTimes