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Best Buy (BBY) 3Q Adj Earnings Drop 94.2 Pct, Miss Estimates; Shares Fall

 November 20, 2012 09:09 AM

(By Balaseshan) Best Buy Co. Inc. (NYSE: BBY) slipped to a quarterly loss due to a restructuring charges primarily related to store closures. Despite revenue beating consensus, adjusted earnings missed Street's expectations, sending its shares down 3.85% in premarket.

Loss from continuing operations for the third quarter were $13 million or $0.04 per share, compared to a profit of $173 million or $0.47 per share last year. Adjusted earnings per share (EPS) from continuing operations plunged 94% to $0.03 from $0.47.

Revenue declined to $10.75 billion from $11.15 billion. Comparable store sales decreased 4.3% for the latest quarter.

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Analysts, on average, polled by Thomson Reuters had expected a profit of $0.12 per share on revenue of $10.73 billion for the third quarter.

The Domestic segment comparable store sales declined 4.0%, while International segment comparable store sales decreased 5.2%. Revenue from Domestic segment fell 4.7% to $7.7 billion, while International segment revenue declined 1% to $3.1 billion.

Return on assets for the 12 months ended November 3, 2012 showed a negative 2.7% compared to a positive 6.2% last year. Adjusted Return on invested capital (ROIC) fell to 10.1% from 10.7%.

Looking ahead into the fiscal 2013, the company currently expects to generate free cash flow in the range of $850 million to $1.05 billion, lower than previously communicated range of $1.25 to $1.5 billion that had been provided on August 21, 2012.

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BBY closed Monday's regular session at $13.75. The stock has been trading between $13.52and $28.52 for the past 52 weeks.

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