Circuit City Stores Inc. (Richmond, Va.) announced that chairman and ceo W. Alan McCollough has decided to retire as ceo effective Feb. 28, 2006, and as chairman of the board at the 2006 annual shareholders meeting. He has decided not to stand for reelection to the board at the end of his term that expires in June 2006.
Circuit City president Philip Schoonover was elected unanimously to the board, effective immediately, and named ceo effective March 1, 2006.
McCollough joined the company in 1987 as general manager of corporate operations. He was elected assistant vp in 1989; vp and central division president in 1991; senior vp, merchandising, in 1994; president and chief operating officer in 1997; ceo in June 2000; and chairman of the board in June 2002.
Schoonover joined Circuit City as executive vp and chief merchandising officer in October 2004 and was named president in February 2005. He has been responsible for the store operations, marketing, merchandising, supply chain, business development and strategy groups. Prior to joining Circuit City, he spent nine years with arch-rival Best Buy Co. Inc. (Richfield, Minn.), most recently as executive vp, customer segments, from April until September 2004. He has also held senior management positions with TOPS Appliance City (Edison, N.J.) and Sony Corp. of America (New York).
McCullough's announcement came as the frequently troubled consumer electronics retailer reported a 14.7 percent total sales increase for the third quarter ended Nov. 30, 2005. Same-store sales increased 13.1 percent.
"I want to thank our associates for their work in producing exceptional sales results this quarter as the company achieved third quarter profitability," McCollough said. "During the quarter, we continued to build upon the traction that began in the second quarter on our parallel efforts to upgrade, evolve and innovate our business. Our sales growth is largely attributed to increases in close rate and average ticket, since store traffic for the quarter was relatively flat. During the quarter we also made significant investments in innovation, a new point-of-sales system and our merchandising systems transformation.
"We saw strength in a broad number of categories, but particularly in flat panel televisions, portable digital audio products, notebook computers and digital imaging products. During the quarter, we increased advertising levels above last year in order to familiarize consumers with the new brand."
The company said it expects to open three new superstore and relocate one relocated during its fourth quarter. "Over the summer, we made substantial changes to our real estate organization, and we still need to improve our real estate portfolio," said McCollough. "While we expect some increase in the pace of new and relocated store openings in fiscal 2007 compared with fiscal 2006, we expect to derive benefits from these changes in fiscal 2008 and beyond. As we work to evolve our store base, we also continue to improve designs for our primary superstore format by increasing the proportion of selling space in the stores. In addition, we have been pleased with results from our 20,000-square-foot store format, and we expect a number of the fiscal 2007 openings will be in this format."