Guitar Center Earnings to Fall Below Forecasts

Musical instrument retailer Guitar Center Inc. said Wednesday that its third-quarter earnings will be well below Wall Street forecasts as the Sept. 11 terrorist attacks take a toll on sales.

The Westlake Village-based retailer said it expects to post third-quarter earnings of 4 cents to 6 cents a share, while net sales for the period are expected to be $219 million to $222 million.

Wall Street analysts polled by Thomson Financial/First Call are expecting the company to post earnings of 14 cents to 19 cents a share, with a mean estimate of 16 cents a share, while revenue was expected to be $225.6 million.

The company said retail sales for the period are expected to range from $186 million to $188 million, and sales at stores open at least one year are expected to rise 2% to 3% range for the quarter.

Guitar Center Chairman and Co-Chief Executive Larry Thomas said September sales are running about $6 million, or 10%, below plan. He said he is “cautiously optimistic” that sales will rebound, but it is difficult to forecast earnings and sales for the rest of the year.

Shares of the company fell 11 cents on Wednesday to $10.87 on Nasdaq.