U.S. electronics retailer RadioShack Corp reported its ninth straight quarterly loss and is burning through cash as it struggles to sustain its turnaround efforts, which so far have failed to bear fruit.
RadioShack's shares fell as much as 14 percent amid doubts about the company's long-term prospects as a series of executive exits have added to the competitive pressure it faces from stores offering a wider selection at lower prices.
The company has been slashing prices to outdo retailers such as Best Buy Co Inc, Amazon.com Inc and Wal-Mart Stores Inc, yet its sales have been falling since 2010.
"The (RadioShack) brand is tired, and they don't have the capital to re-position the brand," Wedbush Securities analyst Michael Pachter said, adding that the company can turn things around only by drawing customers back into its stores.
The company's net sales fell a steeper-than-expected 13 percent and sales in stores open for at least a year fell 14 percent in the first quarter ended May 3.
RadioShack ended the quarter with liquidity of $423.7 million, lower than the $554.3 million as of Dec. 31. Its cash and cash equivalents plummeted by a third to $61.8 million in the same period. "... We increasingly believe time could be running out for the company," BB&T Capital Markets analyst Anthony Chukumba wrote in a note.
RadioShack has been trying to reposition itself to connect with tech-savvy young shoppers by signing up celebrities for promotions and opening "concept stores", which allow shoppers to try a product before making a purchase.
While these stores have been doing well, only 38 of its 4,250 stores in the United States are concept stores.
The company plans to close 200 stores per year over the next three years, Chief Financial Officer John Feray said on a conference call.
That is lower than the 1,100 closures it had announced in March as it failed to negotiate favorable terms with its lenders.
In a sign of growing investor frustration with the company, RadioShack's shareholders rejected its executive compensation plan for the second year in a row, a filing showed on Monday.
The company's first-quarter net loss widened to $98.3 million, or 97 cents per share, from $28.0 million, or 28 cents per share, a year earlier.
RadioShack's adjusted loss of 98 cents per share fell far short of the average analysts' expectation of a loss of 52 cents per share, according to Thomson Reuters I/B/E/S.
The company's shares were down 9.7 percent at $1.39 in late morning trading on the New York Stock Exchange. The stock has lost more than half its value in the year to Monday's close.
(This story corrects to fix typos in paragraph 1)
(Editing by Kirti Pandey, Maju Samuel and Savio D'Souza)