Book category continues to suffer in downturn
New York City The country’s two major booksellers reported quarterly results on Tuesday, and the picture wasn’t rosy. Barnes & Noble reported a second-quarter loss of $24 million, widened from a loss of $18 million a year ago. Included in the net loss were one-time transaction expenses of $0.13 per share associated with the college acquisition.
Barnes & Noble lowered its guidance due to expected weak holiday sales and higher-than-expected costs to ramp up production of its electronic book reader, the Nook. The company also noted it is increasing future investments related to its digital strategy, including additional people, technology and in-store marketing support.
Total sales for the quarter ended Oct. 31 were $1.2 billion, a 4% increase over the year-ago period.
Meanwhile, competitor Borders Group lost money for the third straight quarter as sales at its bookstores continued to decline, but the loss was smaller than a year ago. For the fiscal third quarter ended Oct. 31, the company lost $39 million, improved from a loss of $172 million a year ago.
Total sales declined to $595.5 million, compared with $682.1 million in the prior year.
Comparable-store sales dipped 12.1% and 7.2% at Borders superstores and Waldenbooks stores, respectively.
Borders has been trying to turn around its business for some time. The bookseller continued its efforts during the quarter, trimming inventory by $99.1 million and lowering its selling, general and administrative expenses by $27.1 million. Total debt was $375 million at quarter’s end, a reduction of $112 million.
Borders names new SVP marketing
ANN ARBOR, Mich. Borders Group has appointed Bill Dandy SVP marketing.
According to the company, Dandy has more than 20 years of retail experience, serving in marketing and operations leadership roles for several multi-billion-dollar retail organizations. Most recently, he served for three years as EVP, marketing, for Mattress Firm. Prior to that, Dandy served as chief marketing officer for $2.3 billion retailer Dick’s Sporting Goods.
As Dandy assumes the SVP marketing role, Art Keeney–who has served in that post at Borders since June–will transition to the position of SVP store operations, where he will lead the national store operations team with a focus on customer service. Keeney is a 30-year retail veteran who has led operations as well as marketing for national retailers throughout his career.
To provide high-level strategic leadership within Borders’ core book category, the company also announced today that Larry Norton will move from his current role as SVP, merchandising and distribution, to the position of SVP, merchandising for adult trade and children’s books. Norton, who joined the company in August, is a 27-year publishing industry veteran who will now lead the book buying teams at Borders.
Best Buy, B&N get in on new e-reader launch
Best Buy will sell a new e-reader that links to the Barnes & Noble e-bookstore, beginning this October.
The DR800SG e-reader, manufactured by Irex Technologies, measure 8.1 inches, has a touch screen and offers multi-mode 3G wireless capabilities.
Through a partnership with Barnes & Noble, Irex can offer users of the e-reader access to more than 750,000 titles, including new releases and bestsellers at $9.99. In addition, Irex has partnered with Verizon Wireless to provide DR800SG users with wireless connectivity and fast downloads.
The e-reader, which will be available at select Best Buy stores, has an MSRP of $399.99. Wireless access to download content is included in the cost of the DR800SG and no contract is required.