Barnes & Noble posts loss, cuts sales forecast
Barnes & Noble Inc reported a wider quarterly loss, hurt by a charge, and the bookseller cut its forecast for full-year sales at existing stores, citing the difficult retail environment.
Borders said in March that it might sell itself as it has struggled with liquidity and the soft economy, and Barnes & Noble has said it is studying a potential acquisition of the company.
Barnes & Noble reported a loss of $2.2 million, or 4 cents per share, for its fiscal first quarter ended May 3, compared with a loss of $1.67 million, or 3 cents per share, a year earlier.
The latest results included a pre-tax charge of $8.3 million for the settlement of a dispute regarding the collection of taxes on sales made by its online unit.
Excluding the charge, earnings from operations were 5 cents per share - at the low end of its forecast for 5 cents to 10 cents per share, but in line with the average Wall Street forecast, according to Reuters Estimates.
Quarterly sales rose to $1.16 billion from $1.15 billion. Sales at Barnes & Noble stores open at least a year, a key retail gauge known as same-store sales, fell 1.5%.
Booksellers, like many retailers, have come under pressure as rising gasoline and food prices eat up more of consumers' income and curb discretionary spending.During the quarter, Barnes & Noble said same-store sales were weakest in April, but May had improved a bit due to recent book releases like Barbara Walters' "Audition: A Memoir." It said customer traffic in the quarter declined.
Best-selling titles included John Grisham's “The Appeal,” Randy Pausch's “The Last Lecture,” Michael Pollan's “In Defense of Food,” Sophie Kinsella's “Remember Me?” and Jodi Picoult's “Change of Heart.”
Barnes & Noble now expects full-year same-store sales to be down slightly, compared with its earlier view for a slight rise.
Second-quarter same-store sales are expected to decrease in the low to mid-single digits compared with a year earlier, it said. Year-ago results were boosted by sales of “Harry Potter and the Deathly Hallows.”
The retailer still expects full-year earnings per share of $1.70 to $1.90, saying it will have fewer shares outstanding due to a stock buyback program. Second-quarter earnings per share are expected to be 8 cents to 13 cents, it said.
Barnes & Noble shares fell 9 cents to $29.86 in morning New York Stock Exchange trading. (Reuters)
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