Barnes & Noble widens loss in Q4; to open smaller format
The nation’s largest bookseller reported a wider loss in its fourth quarter over last year amid disappointing sales and charges related to turnaround initiatives.
Barnes & Noble’s net loss for the quarter ended April 28 was $21.1 million, or 29 cents per share, compared to a loss of $13.4 million, or 19 cents per share, in the year-ago period. The loss includes $7.7 million in non-recurring charges. Analysts had expected a loss of 20 centers per share.
Sales fell 3.4% to $786.1 million, which is better than analysts had expected. Same-store sales decreased 4.1%.
On the chain’s quarterly call, CEO Demos Parneros said to improve sales trends, the retailer is focused on enhancing the customer experience, better curation, increasing the value for its members and investing in marketing to drive traffic. It is also “innovating for the future” through newly designed stores.
“We're excited to open several new prototype stores this year, which will feature a completely new design,” Parneros said. “We see a lot of opportunity for the smaller and more flexible prototype.”
Barnes & Noble’s target size for the new stores is 14,000 sq. ft.
“We are excited to be launching early fall with the first one of these stores and we intend to get great learning and takeaways from these,” Parneros added.
For the full year, Barnes & Noble’s sales fell 6%, to $3.7 billion. Same-store sales were down 5.4%. The retailer sees better days ahead.
“In fiscal 2018 we developed a long-term strategic turnaround plan, which we continue to execute,” said Parneros in a statement. “Our plan, which includes sales improvements and cost reductions, is expected to yield immediate improvement in fiscal 2019, resulting in EBITDA of $175 million to $200 million, and further benefits in the following years.”