Best Buy trims forecast for ’09

Best Buy Co. narrowed its fiscal 2009 earnings forecast Friday and said it would take an approximately $60-million fourth-quarter charge related to some employee buyouts.

The nation’s No. 1 electronics retailer is trying to control costs and inventory as consumer anxiety grows amid the worsening recession and job losses.

The pullback by shoppers, which has hurt a wide swath of retailers, has been so sharp that Best Buy hasn’t been able to take advantage of its largest rival’s bankruptcy woes.

Circuit City Stores Inc. filed for Chapter 11 bankruptcy protection in November because of slowing sales and mounting debt. The No. 2 electronics retailer, based in Richmond, Va., said Friday that it was in talks with two “interested parties” that could buy the company or provide additional financing so it could stay in business.

Best Buy said it now expected profit of $2.50 to $2.70 a share for its fiscal year that ends in February. It previously projected earnings of $2.30 to $2.90 a share.

The updated outlook reflects a probable 2% to 3% decline in same-store sales, an important retail industry metric that compares sales figures for stores open at least a year. Best Buy’s outlook excludes a $111-million third-quarter charge for expenses related to buyouts and other restructuring charges.

Analysts polled by Thomson Reuters predict net income of $2.61 a share. Analyst estimates typically exclude one-time items.

Aside from its revised guidance, Best Buy reported that December same-store sales fell 6.5%. A decline in foot traffic was partially offset by higher average sales. The company said it managed inventory “aggressively” during the month and was looking to end its fiscal year with domestic inventory essentially flat compared with a year earlier.

Best Buy shares fell $1.57, or 5.3%, to $28.08.