Guitar Center Reports Modest Income Growth

Calling the retail environment “challenging,” Guitar Center Inc. reported net income increased 4 percent to $13.4 million or $0.47 per diluted share on revenues of $458 million for the second quarter ended June 30. That compares with earnings of $12.9 million or $0.46 per share on revenues of $402.3 million for the second quarter of 2005. The Westlake Village-based music products retailer said same store sales increased 5.1 percent for the second quarter in its Guitar Center division. “We achieved a 5.1 percent comparable store sales increase in our Guitar Center division despite experiencing a more challenging retail environment throughout the quarter,” said Erick Mason, Guitar Center’s CFO. The company said it expected its net income for the third quarter to be in the range of $0.40 to $0.46 per share, somewhat lower than original guidance issued in February because it includes stock option expenses in the range of $0.02 to $0.03 per share. Guitar Center said its third quarter revenues are expected to be at the low end of the $489 million to $501 million range the company provided in February.