Car Mart Earnings Dip On Tax Refund Timing

America’s Car-Mart blamed the timing of tax refunds for a slip in third quarter earnings, but says it expects to rebound in the coming quarter.

The Bentonville-based "buy-here, pay here" used car dealer reported third quarter net income of $5.69 million compared to $6.28 million one year ago. Revenues for Car-Mart increased 10.5% to $92.6 million during the quarter that ended January 31, 2011 with same-store sales up a solid 5.3%.

"Our solid top line growth continues and would have been even stronger during the quarter absent the negative effects from the timing of income tax refund money in our markets," said Car-Mart CEO William "Hank" Henderson. "Had the timing of refunds been the same as prior years we feel that we would have seen much higher sales volumes during the third quarter. The delay is expected to push out some sales into our fourth quarter. Based on sales levels thus far in February this appears in fact to be the case."

The company’s credit losses have come back down and were described as "basically flat" compared to last year’s comparable quarter.

Car-Mart has been busy expanding during its current fiscal year. It has added 7 new locations and vowed to open "several more" before its fiscal year-end in April.

"The contributions of these new locations will be an important factor in keeping us on our projected growth targets. We are excited about our future and the tremendous opportunities in front of us to move into new markets and continue to serve existing markets the Car-Mart way," Henderson said.

The company also repurchased 205,884 shares, or 1.9%, of its common stock during the quarter.