Barnes & Noble, Inc. Reports: Fiscal 2000 Retail EPS of $1.69 Per Share in Line With Consensus Estimates.Business Editors NEW YORK--(BUSINESS WIRE)--March 22, 2001 Barnes Barnes, former municipal borough, SE England. See Richmond upon Thames. & Noble, Inc. (NYSE NYSE See: New York Stock Exchange :BKS BKS Barracks BKS Best Kept Secret (gaming) BKS Bildung, Kultur Und Sport (German) BKS Brookside (city) BKS Bergen Kirurgiske Sykehus (Bergen, Norway) ), the nation's largest bookseller, today reported fiscal 2000 retail earnings of $109.5 million or $1.69 per share. Consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: net earnings on a pro-forma basis for the year, before a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. , non-cash impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charge, were $68.1 million or $1.06 per share. The one-time charge of $92.4 million, net of tax (or $1.44 per share), was primarily due to the impairment of goodwill and selected assets of B. Dalton Dalton, city (1990 pop. 21,761), seat of Whitfield co., extreme NW Ga., in the Appalachian valley; inc. 1847. It is a highly industrialized city in a farm area. . These results were in line with consensus estimates. As previously announced, bookstore sales for fiscal year ended 2000 were $3.6 billion, an increase of 8.9 percent over the same period last year. Barnes & Noble "super" store sales rose 12.3 percent to $3.2 billion and comparable store sales increased 4.9 percent. Barnes & Noble Booksellers reported full-year retail net earnings of $1.85 per share. At the same time, Barnes & Noble.com reported a 65 percent increase in sales to $320 million in fiscal 2000. Babbage's reported fiscal 2000 sales of $757.6 million, an increase of 37 percent on a pro-forma basis. Comparable store sales decreased 6.7 percent. Babbage's reported a full-year net loss of $10.2 million or a loss of $0.16 per share. For the year, retail EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become rose 11.9 percent to $385 million. The strong cash flows enabled the company to fund new store openings, systems enhancements and other initiatives, including the purchase of Funco. On March 14, 2001, the company announced the successful completion of the sale of $275 million in 5.25 percent convertible subordinated Subordinated A claim ranked lower in priority than other claims. Common stock claims are always subordinated to debt. notes due March 15, 2009, further strengthening its balance sheet. The notes are convertible into the company's common stock at a conversion price of $32.51 per share. "Overall, we are pleased with the performance of our core Barnes & Noble 'super' store business," said Leonard Leon·ard , Ray Charles Known as "Sugar Ray." Born 1956. American boxer who won the 1976 Olympic light welterweight title. He held five world titles as both a welterweight and middleweight between 1979 and 1987. Noun 1. Riggio, chairman and chief executive officer of Barnes & Noble, Inc. "The company achieved industry-leading comparable sales increases despite a somewhat weak holiday season." Mr. Riggio continued, "Babbage's is poised to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the explosive explosive, substance that undergoes decomposition or combustion with great rapidity, evolving much heat and producing a large volume of gas. The reaction products fill a much greater volume than that occupied by the original material and exert an enormous pressure, growth in the video game market in 2001 due to the launch of three new platforms and the increased availability of PlayStation A video game console from Sony that was introduced in the U.S. in 1995. CD-ROM based and using a 32-bit MIPS CPU, the original PlayStation was the first of a family of desktop and handheld units. 2." As of February February: see month. 3, 2001, the company operated 569 "super" stores, 339 B. Dalton stores and 978 video game and entertainment stores. The company projects consolidated earnings per share growth for 2001 of over 50 percent to $1.61 per share, consisting of $1.98 for Barnes & Noble Booksellers, $0.09 for Babbage's, a pro-forma loss of $0.40 for our share of Barnes & Noble.com and a loss of $0.06 for our share of other equity investments. This is on a share basis of 74.5 million shares, which includes the dilutive effect Dilutive effect Result of a transaction that decreases earnings per common share (EPS). of the convertible notes. For our core "super" store business, the company expects a comparable store sales increase of 4 to 5 percent for 2001. The company expects to report operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. and EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. improvement for our "super" store business in each quarter of 2001 as we achieve occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy and gross margin leverage. Retail sales are expected to be somewhat weaker the first half of 2001 compared to 2000. Comparable bookstore sales benefited from the unprecedented success of Harry Potter A potter is someone who makes pottery. Potter may also refer to: People
About Barnes & Noble, Inc. Barnes & Noble, Inc. (NYSE: BKS) operates 569 Barnes & Noble and 339 B. Dalton bookstores, and, with its acquisition of Babbage's Etc. and Funco, Inc., is the nation's largest operator of video game and entertainment software stores. Barnes & Noble stores stock an authoritative selection of book titles and provide access to more than one million titles. They offer books from more than 50,000 publisher imprints with an emphasis on small, independent publishers and university presses. Barnes & Noble is one of the world's largest booksellers on the World Wide Web (http://www.bn.com), and the premiere bookseller on America America [for Amerigo Vespucci], the lands of the Western Hemisphere—North America, Central (or Middle) America, and South America. The world map published in 1507 by Martin Waldseemüller is the first known cartographic use of the name. Online's (Keyword (1) A word used in a text search. (2) A word in a text document that is used in an index to best describe the contents of the document. (3) A reserved word in a programming or command language. 1. : bn) proprietary network. Barnes & Noble.com has the largest standing inventory of any online bookseller. Barnes & Noble also publishes books under its own imprint im·print tr.v. im·print·ed, im·print·ing, im·prints 1. To produce (a mark or pattern) on a surface by pressure. 2. To produce a mark on (a surface) by pressure. 3. for exclusive sale through its retail stores and Web site. General financial information on Barnes & Noble, Inc. can be obtained via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the by visiting the company's corporate Web site: http://www.barnesandnobleinc.com/financials. SAFE HARBOR Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. This press release (including the attached schedule) contains "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. ." Barnes & Noble is including this statement for the express purpose of availing itself of the protections of the safe harbor provided by the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 with respect to all such forward-looking statements. These forward-looking statements are based on currently available information and represent the beliefs of the management of the company. These statements are subject to risks and uncertainties that could cause actual results to differ materially. These risks include, but are not limited to, general economic and market conditions, decreased consumer demand for the company's products, possible disruptions in the company's computer or telephone systems, possible work stoppages or increases in labor costs, possible increases in shipping rates or interruptions in shipping service, effects of competition, possible disruptions or delays in the opening of new stores or the inability to obtain suitable sites for new stores, higher than anticipated store closing or relocation RELOCATION, Scotch law, contracts. To let again to renew a lease, is called a relocation. 2. When a tenant holds over after the expiration of his lease, with the consent of his landlord, this will amount to a relocation. costs, higher interest rates, the performance of the company's online and other initiatives, the successful integration of acquired businesses, unanticipated increases in merchandise MERCHANDISE. By this term is understood all those things which merchants sell either wholesale or retail, as dry goods, hardware, groceries, drugs, &c. It is usually applied to personal chattels only, and to those which are not required for food or immediate support, but such as remain or occupancy costs Occupancy costs are the whole life costs of buildings and their associated land from occupancy until disposal. These costs may be incurred on a regular or irregular basis. Occupancy costs are those costs related to occupying a space including; rent, real estate taxes, personal , unanticipated adverse litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. results or effects, product shortages, and other factors which may be outside of the company's control. Please refer to the company's annual, quarterly and periodic reports on file with the SEC for a more detailed discussion of these and other risks that could cause results to differ materially.
Barnes & Noble, Inc.
Fiscal 2000 Summary
($ in millions, except per share amounts)
Fourth Quarter Full Year
-------------------- --------------------
2000 1999 2000 1999
-------- -------- -------- --------
BARNES & NOBLE
RETAIL OPERATIONS
BARNES & NOBLE
BOOKSELLERS
(Retail Bookstores)
Sales (1) $ 1,212 1,101 3,552 3,262
EBITDA 186 188 357 325
EPS 1.31 1.30 1.85 1.62
BABBAGE'S
(Video Game & Entertainment
Software Stores)
Sales 327 224 758 224
EBITDA 21 19 28 19
EPS 0.06 0.10 (0.16) 0.10
RETAIL EPS 1.37 1.40 1.69 1.72
INVESTING ACTIVITIES
Gain on Barnes &
Noble.com - - - 0.21
Chapters gain - - - 0.09
Share of pro forma net
losses of Barnes &
Noble.com (2) (0.18) (0.13) (0.55) (0.35)
Share of net earnings
(losses) from other
investments 0.02 0.02 (0.08) (0.01)
NuvoMedia gain - 0.19 - 0.19
CONSOLIDATED EPS BEFORE
IMPAIRMENT CHARGE 1.21 1.48 1.06 1.85
OTHER ADJUSTMENTS
Impairment charge (1.43) - (1.44) -
Ingram write-off - - - (0.04)
Change in accounting
for pre-opening - - - (0.06)
-------- -------- -------- --------
CONSOLIDATED PRO
FORMA EPS $ (0.22) 1.48 (0.38) 1.75
======== ======== ======== ========
CONSOLIDATED EPS,
AS REPORTED $ (0.52) 1.48 (0.81) 1.75
======== ======== ======== ========
Weighted average
shares outstanding 64,777,000 70,098,000 64,341,000 71,354,000
(1) Fiscal 2000 results exclude sales of $65.7 million from Calendar
Club LLC, a majority owned subsidiary. Calendar Club LLC was
accounted for under the equity method in 1999.
(2) Pro forma results are presented for informational purposes only
and are not prepared in accordance with generally accepted
accounting principles. Such results present the net loss of
Barnes & Noble.com, excluding charges related to impairment and
special charges, stock-based compensation, and acquisition and
investment-related costs, including amortization of intangibles
and equity in net loss of equity investments.
Barnes & Noble, Inc. Consolidated
Fiscal 2001 Projection
Fiscal Year Ending February 2, 2002
------------------------------------
Total
Q1 Q2 Q3 Q4 (1) Year (1)
------ ------ ------ ------ -------
BARNES & NOBLE
RETAIL OPERATIONS
Retail Bookstores $ 0.18 0.21 0.23 1.35 $ 1.98
Video Game &
Entertainment
Software Stores (0.13) (0.16) (0.02) 0.35 0.09
------ ------ ------ ------ ------
RETAIL EPS $ 0.05 0.05 0.21 1.70 $ 2.07
====== ====== ====== ====== ======
INVESTING ACTIVITIES
Share of pro forma
net losses of
Barnes &
Noble.com (2)(3) $(0.40)
Share of net
earnings (losses)
from other
investments (4) $(0.06)
------
CONSOLIDATED PRO
FORMA EPS $ 1.61
======
Weighted average
shares
outstanding 64,500,000 64,600,000 64,700,000 75,000,000 74,500,000
(1) EPS amounts for the fourth quarter and total year include the
dilutive effect of the 5.25% convertible subordinated notes due
March 15, 2009, issued on March 14, 2001.
(2) Barnes & Noble.com previously reported an expected pro forma net
loss for the first quarter of ($0.19) to ($0.22) per share and
($0.75) to ($0.85) for the full year. Our estimated share of
those losses are expected to be ($0.10) to ($0.12) for the first
quarter and ($0.35) to ($0.40) for the full year. Additional
quarterly guidance will be provided at a future date.
(3) Pro forma results are presented for informational purposes only
and are not prepared in accordance with generally accepted
accounting principles. Such results present the net loss of
Barnes & Noble.com, excluding charges related to impairment and
special charges, stock-based compensation, and acquisition and
investment-related costs, including amortization of intangibles
and equity in net loss of equity investments.
(4) Results from other investments are expected to be ($0.07),
($0.07), ($0.07) and $0.12 per share for the first, second, third
and fourth quarters of fiscal 2001, respectively.
BARNES & NOBLE, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(thousands of dollars, except per share data)
----------------------------------------------------------------------
14 weeks 13 weeks 53 weeks 52 weeks
ended ended ended ended
February 3, January 29, February 3, January 29,
2001 2000 2001 2000
----------- ----------- ----------- -----------
Sales $1,605,384 1,324,639 4,375,804 3,486,043
Cost of sales and
occupancy 1,146,331 914,461 3,169,724 2,483,729
---------- ---------- ---------- ----------
Gross profit 459,053 410,178 1,206,080 1,002,314
---------- ---------- ---------- ----------
Selling and
administrative
expenses 250,119 201,119 812,992 651,099
Depreciation and
amortization 40,161 32,160 144,760 112,304
Pre-opening expenses 1,583 2,338 7,669 6,801
Impairment charge 106,833 - 106,833 -
---------- ---------- ---------- ----------
Operating profit 60,357 174,561 133,826 232,110
Interest expense, net (15,477) (8,413) (53,541) (23,765)
Equity in net loss of
Barnes & Noble.com (49,497) (15,235) (103,936) (42,047)
Gain on formation of
Barnes & Noble.com - - - 25,000
Other income
(expense), net 2,333 24,531 (9,346) 27,337
---------- ---------- ---------- ----------
Earnings (loss)
before taxes and
cumulative effect
of a change in
accounting principle (2,284) 175,444 (32,997) 218,635
Income taxes 31,715 71,932 18,969 89,637
---------- ---------- ---------- ----------
Earnings (loss)
before cumulative
effect of a change
in accounting
principle (33,999) 103,512 (51,966) 128,998
Cumulative effect of a
change in accounting
principle, net of tax
benefit of $3,125 - - - (4,500)
---------- ---------- ---------- ----------
Net earnings(loss) $ (33,999) 103,512 (51,966) 124,498
========== ========== ========== ==========
Earnings (loss) per
common share:
Basic
Earnings (loss)
before cumulative
effect of a
change in
accounting
principle $ (0.52) 1.52 (0.81) 1.87
Cumulative effect
of a change in
accounting
principle,
net of tax $ - - - (0.07)
Net earnings(loss)$ (0.52) 1.52 (0.81) 1.80
Diluted
Earnings (loss)
before cumulative
effect of a change
in accounting
principle $ (0.52) 1.48 (0.81) 1.81
Cumulative effect
of a change in
accounting
principle,
net of tax $ - - - (0.06)
Net earnings(loss)$ (0.52) 1.48 (0.81) 1.75
Weighted average common
shares outstanding
Basic 64,777,000 68,316,000 64,341,000 69,005,000
Diluted 64,777,000 70,098,000 64,341,000 71,354,000
Percentage of sales:
Sales 100.0% 100.0% 100.0% 100.0%
Cost of sales and
occupancy 71.4% 69.0% 72.4% 71.2%
---------- ---------- ---------- ----------
Gross profit 28.6% 31.0% 27.6% 28.8%
---------- ---------- ---------- ----------
Selling and
administrative expenses 15.6% 15.2% 18.6% 18.7%
Depreciation and
amortization 2.5% 2.4% 3.3% 3.2%
Pre-opening expenses 0.1% 0.2% 0.2% 0.2%
Impairment charge 6.6% 0.0% 2.4% 0.0%
---------- ---------- ---------- ----------
Operating profit 3.8% 13.2% 3.1% 6.7%
Interest expense, net -1.0% -0.6% -1.2% -0.7%
Equity in net loss of
Barnes & Noble.com -3.1% -1.2% -2.4% -1.2%
Gain on formation of
Barnes & Noble.com 0.0% 0.0% 0.0% 0.7%
Other income
(expense), net 0.1% 1.8% -0.2% 0.8%
---------- ---------- ---------- ----------
Earnings (loss)
before taxes and
cumulative effect
of a change in
accounting principle -0.2% 13.2% -0.7% 6.3%
Income taxes -1.9% 5.4% 0.4% 2.6%
---------- ---------- ---------- ----------
Earnings (loss)
before cumulative
effect of a change
in accounting
principle -2.1% 7.8% -1.1% 3.7%
Cumulative effect of a
change in accounting
principle, net of tax
benefit of $3,125 0.0% 0.0% 0.0% -0.1%
---------- ---------- ---------- ----------
Net earnings(loss) -2.1% 7.8% -1.1% 3.6%
========== ========== ========== ==========
BARNES & NOBLE, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(thousands of dollars, except per share data)
----------------------------------------------------------------------
February 3, January 29,
2001 2000
---------- ----------
ASSETS
Current assets:
Cash and cash equivalents $ 26,003 24,247
Receivables, net 84,505 58,240
Merchandise inventories 1,238,618 1,102,453
Prepaid expenses and other
current assets 106,127 56,579
---------- ----------
Total current assets 1,455,253 1,241,519
---------- ----------
Property and equipment:
Land and land improvements 3,247 3,247
Buildings and leasehold improvements 436,289 417,535
Fixtures and equipment 682,444 565,345
---------- ----------
1,121,980 986,127
Less accumulated
depreciation and amortization 555,760 418,078
---------- ----------
Net property and equipment 566,220 568,049
---------- ----------
Intangible assets, net 359,192 298,011
Investment in Barnes & Noble.com 136,595 240,531
Other noncurrent assets 40,216 65,681
---------- ----------
Total assets $2,557,476 2,413,791
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 582,075 599,376
Accrued liabilities 353,000 323,475
---------- ----------
Total current liabilities 935,075 922,851
---------- ----------
Long-term debt 666,900 431,600
Deferred income taxes 74,289 125,006
Other long-term liabilities 103,535 87,974
Shareholders' equity:
Common stock; $.001 par value;
300,000,000 shares authorized;
70,549,176 and 69,553,839 shares
issued, respectively 71 70
Additional paid-in capital 673,122 654,584
Accumulated other comprehensive loss (5,874) (1,198)
Retained earnings 227,735 279,701
Treasury stock, at cost, 5,504,700
and 4,025,900 shares,
respectively (117,377) (86,797)
---------- ----------
Total shareholders' equity 777,677 846,360
---------- ----------
Commitments and contingencies - -
---------- ----------
Total liabilities and
shareholders' equity $2,557,476 2,413,791
========== ==========
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