Business

Radio Shack to close 1,100 stores

A Radio Shack store in the US Image copyright Getty Images
Image caption Radio Shack has been trying to restructure its business amid widening losses

US electronics retailer Radio Shack has said it plans to close 1,100 stores - nearly 20% of its total - in an attempt to turn around its fortunes.

The move comes as the firm reported a net loss of $400.2m (£240m) for 2013, up from $139.4m a year ago.

Radio Shack has been hurt by growing competition, not least from online stores, which has dented its sales.

The firm's sales fell 10% last year, with revenue during the crucial holiday season fourth quarter down by 20%.

"Our fourth quarter financial results were driven by a holiday season characterized by lower store traffic, intense promotional activity particularly in consumer electronics, a very soft mobility marketplace and a few operational issues," Joseph Magnacca, chief executive of Radio Shack, said in a statement.

Its shares fell as much as 19% in early trading in New York on Tuesday.

The firm's stock has fallen by nearly 80% over the past two years.

Restructuring business

Hurt by slowing sales, the firm has been taking some steps to restructure its business.

These include revamping the assortment of products its carries and improving the efficiency of its operations.

The company said that as part of its plans it looked into the performance and sustainability of its stores over the past few months.

"We have undertaken a comprehensive review of our portfolio from many angles - location, area demographics, lease life and financial performance," it said.

The firm added that it was looking to consolidate its store base "into fewer locations while maintaining a strong presence in each market".

However, it did not disclose if the closure of stores would result in job losses.

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