News You Can Use
PW NewsLine
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For Chain Stores, Comparisons Finally Favorable - Big Bird Wings
It To China
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The nation's two largest booksellers have something they haven't
had
in a long time -- good news to report. After several successive
quarters of slogging through a weak book market, Barnes & Noble
and
Borders Group today both reported significant sales gains in their
second quarters. They posted increases not only in total revenue,
but
also in same store sales, a more telling indication of how the
retailers are performing. The improved results echo those disclosed
by
Books-A-Million yesterday.
B&N's comparable store sales rose 5.1% in July -- primarily
on the
strength of Harry Potter -- and 5.6% for the quarter. Comparable
store
sales even edged up at B. Dalton, rising 0.8% in July and 0.7%
for the
quarter. Borders had less dramatic growth, with same store sales
rising 1.7% at the superstores and 3.7% at Waldenbooks.
While the June release of "Harry Potter and the Order of the
Phoenix"
drove much of the growth, bookselling executives stress that the
upswing wasn't just about a one-book wonder. "It's important
to note
that sales were strong throughout the entire second quarter," says
B&N
CEO Steve Riggio. "The uptick actually began with a strong
Memorial
Day, before Harry Potter."
Riggio credits media attention for turning several books into
blockbusters in the second quarter. They include Hillary Clinton's
"
Living History," John Steinbeck's "East of Eden" --
which became a
bestseller hours after Oprah made it her first classic book club
pick
-- and A. Scott Berg's "Kate Remembered."
Barnes & Noble's bookstore sales jumped to $977.6 million in
the
quarter ended Aug. 2, a 10.5% increase compared with the second
quarter of the prior year. That includes $912.6 million in superstore
sales and $51.3 million from B. Dalton.
The retailer is so encouraged by the trend it's raising its forecast
for same-store sales growth in the third quarter and full year,
projecting growth in the range of 2% to 4% for the third quarter
and
1% to 2% for the year.
Deep discounting of the Harry Potter book held down profits at
B&N,
but that was offset by higher margins in other areas. The bookselling
division had operating profits of $26 million for the quarter,
compared with $24 million during the comparable period the prior
year.
Borders Group had total sales of $826.9 million for the quarter
ended
July 27, an 8.3% increase compared with the second quarter of the
prior year. That included $570 million at the superstores and $168.7
million at the mall-based stores. Borders International sales continue
to grow rapidly, with sales up 34.2% to $88.2 million. Company-wide
operating income increased to $9.8 million, from $8.0 million.
Borders
is forecasting comparable store sales will be down or flat for
the
full fiscal year.
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