ATLANTA — Pressured categories led lease-to-own retailer The Aaron’s Company Inc. to lower revenues in the fourth quarter of FY2023, although it did come out slightly ahead for the full year.
The Atlanta-based company, which owns Aaron’s and BrandsMart, reported net revenues of $529.5 million in the three months ended Dec. 31, 2023, down 10.2% compared with year-ago revenues of $598.6 million.
It posted a net loss of $12.4 million, or 41 cents per diluted share in the quarter vs. a loss of $5.9 million, or 19 cents per share in Q4 2022.
The company noted that the 10.2% decrease in consolidated revenues was primarily due to lower lease revenues and fees at the Aaron’s business and lower retail sales at BrandsMart, while the net loss included restructuring charges of $2.8 million, intangible amortization expense of $2.5 million, stock compensation expense of $3 million, and BrandsMart acquisition-related costs of $0.6 million.
“In response to ongoing pressure in our key product categories at Aaron’s and BrandsMart during 2023, we took strong actions to drive demand and reduce costs,” said CEO Douglas Lindsay. “In Q4, we launched a new omnichannel lease decisioning and customer acquisition program, which led to robust e-commerce growth that has continued into 2024. Also, I’m pleased that we exceeded our cost savings target in 2023, and we remain focused on driving further efficiencies.”
For the full fiscal year, Aaron’s reported revenues of $2.139 billion, a 4.9% decrease against $2.249 billion in 2022. It posted net earnings of $2.8 million, or 9 cents per diluted share, reversing a loss of $5.3 million, or 17 cents per diluted share in 2022.
As 2024 continues, The Aaron’s Company’s guidance includes $2.055 billion to $2.155 billion in revenues for the year, with an earnings range of break-even to a $12 million loss.
“While the lower lease portfolio size to start the year will impact adjusted earnings in 2024, we expect our actions will generate lease portfolio growth,” Lindsay said. “Given the investments we’ve made to innovate our business and the strength of our balance sheet, we are better positioned than ever to drive long-term profitable growth. Our management team and board are highly engaged and committed to taking actions that will deliver additional value for our shareholders.”
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