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Conn's returns to a profit in its 3rd quarter

THE WOODLANDS, Texas (AP) -- Conn's returned to a profit in its third quarter as the retailer booked fewer charges and sales of furniture and mattresses strengthened. The results topped Wall Street's view, and the company raised its fiscal 2013 forecast and gave a fiscal 2014 earnings outlook above analyst estimates, but shares fell slightly on separate news of a new stock offering.

The company, which also sells home appliances, consumer electronics and other items, posted net income of $11.8 million, or 35 cents per share, for the three months ended Oct. 31. That compares with a net loss of $12.7 million, or 40 cents per share, a year ago.

Analysts, on average, forecast earnings of 27 cents per share, according to FactSet.

The recent quarter included about $1.4 million in charges related to extending and expanding its borrowing capabilities and moving its headquarters to The Woodlands, Texas. The prior-year period included about $19.2 million in charges.

Revenue increased 11 percent to $206.4 million from $186.6 million. Wall Street expected $198.9 million.

Furniture and mattress sales rose 31.7 percent in the quarter, while demand improved for home office equipment and appliances.

Revenue at stores open at least a year, a key gauge of a retailer's health, climbed 12.6 percent. This metric excludes results from stores recently opened or closed and provides a look at growth in ongoing locations.

Conn's said that revenue for its credit segment increased 22.6 percent to $38.7 million.

For the fiscal year ending in January, Conn's Inc. now anticipates adjusted earnings of $1.55 to $1.60 per share. Its prior outlook was for adjusted earnings in a range of $1.40 to $1.50 per share. The revised guidance assumes revenue at stores open at least a year will climb 13 percent to 16 percent.

Analysts expect earnings of $1.52 per share, with estimates ranging from $1.45 to $1.60.

The company foresees fiscal 2014 earnings of $2.05 to $2.15 per share, which assumes revenue at stores open at least a year will be flat to up 5 percent.

Wall Street predicts earnings of $1.90 per share, with estimates ranging from $1.80 to $2.02.

Conn's also said the president of its credit division, Rey de la Fuente, is leaving after 14 years with the company in order to pursue other opportunities. He will remain with Conn's through Jan. 31, to help with the completion of the transition process.

Separately, the retailer said that it is selling about 1.4 million, and certain shareholders are selling about 3.6 million shares in a public offering that started Monday.

Conn's said that it will give the underwriters a 30-day option to buy up to about 750,000 shares to cover any excess demand.

Conn's stock slipped 17 cents, to $28.10 in morning trading on Monday.