UPDATE 1-Rent-A-Center sees weak demand, cuts forecast
July 21 (Reuters) - Rent-to-own home furniture retailer Rent-A-Center Inc cut its full-year forecast for revenue and profit, saying it expected demand to remain weak, sending its shares down as much as 2 percent in extended trade.
The company also reported a 58 percent drop in second-quarter profit due partly to a rise in operating and restructuring costs.
The company had earlier this month said its results for the latest quarter would be hurt by weaker demand in the United States as macro-economic pressures weigh.
Stagnant wage growth and rising taxes are forcing consumers to keep a lid on discretionary spending. Rival Pier 1 Imports Inc reported lower-than-expected profit for the quarter ended May 31 and cut its full-year profit outlook last month.
Other specialty retailers such as Elfa shelving systems maker Container Store Group Inc also reported weak second-quarter results this month and reduced its full-year forecast.
Rent-A-Center said it now expects earnings of $2-$2.15 per share on revenue growth of 2.5-4 percent for 2014.
It had previously forecast earnings of $2.30-$2.50 per share on revenue growth of 3-6 percent.
Shares of the company were trading at $23.50. They closed at $23.98 on the Nasdaq on Monday. (Reporting by Sruthi Ramakrishnan in Bangalore; Editing by Joyjeet Das and Anil D'Silva)