Barnes & Noble Reports Third Quarter Earnings; Sales Update For November.Business Editors NEW YORK--(BUSINESS WIRE)--November 29, 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 Barnes & Noble "super" store sales for the third quarter ended November November: see month. 3, 2001 were $724.6 million, up 5.0 percent from last year and represented approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 91.0 percent of total bookstore sales. Comparable "super" store sales were up 0.2 percent, as previously reported. GameStop GameStop Corporation (NYSE: GME), headquartered in Grapevine, Texas, a suburb of Dallas, is the world's largest video game and entertainment software retailer. The company operates over 4,900 retail stores throughout Japan, U.S. (formerly Babbage's) sales were $199.0 million, up 8.6 percent from last year, while comparable store sales increased by 3.6 percent, as previously reported. Retail net earnings were $6.1 million or $0.09 per share for the quarter, at the high end of revised guidance. The company's share of pro-forma losses at Barnes & Noble.com improved to $(11.2) million from $(14.6) million for the prior year. 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: pro-forma 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. was a loss of $(0.08) per share for the third quarter, exceeding consensus estimates. SALES UPDATE: Through the first 24 days of November, comparable store sales at Barnes & Noble "super" stores were up 3.2 percent, including a 4.0 percent increase during the important Thanksgiving Thanksgiving annual U.S. holiday celebrating harvest and yearly blessings; originated with Pilgrims (1621). [Am. Culture: EB, IX: 922] See : America Thanksgiving national holiday with luxurious dinner as chief ritual. [Am. Pop. weekend. At GameStop, November has been an especially robust month, as expected, due to the launches of several new platforms and several hot selling video game titles. Comparable store sales for month-to-date were up 83.7 percent and for the Thanksgiving weekend were up 68.2 percent. The company will not issue a subsequent report on November sales, since the above release covers 24 days of the 28-day month. The next sales release will be on January January: see month. 10, 2002, covering the full holiday period. ABOUT BARNES & NOBLE, INC. Barnes & Noble, Inc. (NYSE: BKS) operates 582 Barnes & Noble and 328 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. bookstores, and GameStop (formerly Babbage's), which is the nation's largest operator of video game and entertainment software stores with 1,011 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 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.
Third Quarter Summary
($ in millions, except per share amounts)
13 weeks ended 39 weeks ended
--------------------------------------------
November October November October
3, 2001 28, 2000 3, 2001 28, 2000
--------------------------------------------
Barnes & Noble Booksellers
Sales $ 791.0 $ 768.7 $ 2,442.0 $ 2,339.9
EBITDA 41.0 60.2 144.8 171.2
Depreciation 27.8 29.6 84.3 86.5
Goodwill amortization 0.3 0.9 0.9 3.0
Operating profit 12.9 29.7 59.6 81.7
Interest expense 3.5 7.8 13.7 22.1
Pretax earnings 9.3 21.9 45.9 59.6
Net earnings 5.5 12.8 26.9 34.9
EPS 0.08 0.20 0.41 0.55
GameStop (formerly
Babbage's Etc.)
Sales 199.0 183.2 607.2 430.5
EBITDA 13.4 5.1 20.6 6.9
Depreciation 4.9 3.8 14.1 8.6
Goodwill amortization 2.8 2.7 8.3 6.5
Operating profit(loss) 5.7 (1.5) (1.8) (8.2)
Interest expense 0.1 0.4 0.1 0.7
Pretax earnings(loss) 5.6 (1.8) (1.9) (8.9)
Net earnings(loss) 3.3 (1.1) (1.1) (5.2)
EPS before acquisition
financing cost 0.05 (0.02) (0.02) (0.08)
Acquisition interest
expense 4.6 6.9 15.3 15.3
Acquisition interest
expense per share (0.04) (0.06) (0.14) (0.14)
EPS 0.01 (0.08) (0.16) (0.22)
Retail Net Earnings 6.1 7.7 16.8 20.7
Retail EPS 0.09 0.12 0.25 0.33
Investing Activities
Barnes & Noble.com (1) (11.2) (14.6) (34.7) (41.0)
Other investments (8.2) (3.1) (16.2) (11.7)
ABA legal and
settlement cost - - (4.5) -
EPS (0.17) (0.16) (0.49) (0.48)
Consolidated pro-forma
EPS (1) $ (0.08) $ (0.04) $ (0.24) $ (0.15)
Consolidated EPS,
as reported $ (0.10) $ (0.08) $ (0.30) $ (0.28)
Weighted average
shares outstanding 67,021,000 64,226,000 66,133,000 64,185,000
(1) 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 barnesandnoble.com inc., excluding stock based
compensation and equity in net loss of equity investments
including amortization of intangibles.
GameStop, Inc.
For Informational Purposes Only
($ in millions)
(unaudited)
13 weeks ended 39 weeks ended
---------------------------------------------
November 3, October 28, November 3, October 28,
2001 2000 2001 2000
---------------------------------------------
Sales $ 199.0 $ 183.2 $ 607.2 $ 430.5
Cost of sales 144.4 135.8 450.9 319.5
SG&A (includes
occupancy(a)) 41.2 42.4 135.8 104.1
Depreciation 4.9 3.8 14.0 8.6
-------- ---------- ----------- -----------
Operating profit (loss)
(before goodwill
amortization) 8.5 1.2 6.5 (1.7)
Goodwill amortization 2.8 2.7 8.3 6.5
Interest expense 4.7 7.3 15.4 16.0
-------- ---------- ----------- -----------
Income before taxes 1.0 (8.8) (17.2) (24.2)
Income taxes 0.4 (3.6) (7.2) (10.0)
-------- ---------- ----------- -----------
Net income (loss) 0.6 (5.2) (10.0) (14.2)
Cost of sales 72.5% 74.1% 74.2% 74.2%
SG&A 20.7% 23.1% 22.4% 24.2%
Depreciation 2.5% 2.1% 2.3% 2.0%
-------- ---------- ----------- -----------
Operating profit (loss)
(before goodwill
amortization) 4.3% 0.7% 1.1% (0.4)%
Comparable store sales 3.6% (16.7)% 15.6% (4.1)%
Reclassifications have been made to substantially conform to the
presentation in the recent S-1 Registration Statement.
(a) Occupancy expense was $15.8 million and $13.8 million for the
13-week periods ended November 3, 2001 and October 28, 2000,
respectively. Occupancy expense was $46.5 million and $35.4
million for the 39-week periods ended November 3, 2001 and
October 28, 2000, respectively.
BARNES & NOBLE, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(thousands of dollars, except per share data)
(unaudited)
13 weeks ended 39 weeks ended
-----------------------------------------------
November October November October
3, 2001 28, 2000 3, 2001 28, 2000
---------------------------------------------
Sales (1) $ 995,605 951,834 3,055,260 2,770,420
Cost of sales
and occupancy 733,811 692,963 2,259,093 2,023,393
------------ ---------- ----------- -----------
Gross profit 261,794 258,871 796,167 747,027
------------ ---------- ----------- -----------
Selling and
administrative
expenses 206,675 192,310 631,536 567,303
Depreciation and
amortization 36,477 37,032 109,760 104,599
Pre-opening
expenses 3,314 2,755 5,035 6,086
------------ ---------- ----------- -----------
Operating profit(2) 15,328 26,774 49,836 69,039
Interest expense, net (8,285) (15,008) (29,392) (38,064)
Equity in net loss of
Barnes & Noble.com (13,865) (18,901) (42,086) (54,439)
Other expense, net (4,812) (1,715) (12,525) (7,249)
------------ ---------- ----------- -----------
Loss before taxes (11,634) (8,850) (34,167) (30,713)
Income taxes (4,828) (3,673) (14,179) (12,746)
------------ ---------- ----------- -----------
Net loss $ (6,806) (5,177) (19,988) (17,967)
============ ========== =========== ===========
Loss per
common share:
Basic $ (0.10) (0.08) (0.30) (0.28)
Diluted $ (0.10) (0.08) (0.30) (0.28)
Weighted average
common shares
outstanding
Basic 67,021,000 64,226,000 66,133,000 64,185,000
Diluted 67,021,000 64,226,000 66,133,000 64,185,000
Percentage of sales:
Sales 100.0% 100.0% 100.0% 100.0%
Cost of sales
and occupancy 73.7% 72.8% 73.9% 73.0%
------------- ---------------------------------
Gross profit 26.3% 27.2% 26.1% 27.0%
------------- ---------------------------------
Selling and
administrative
expenses 20.8% 20.2% 20.7% 20.5%
Depreciation and
amortization 3.7% 3.9% 3.6% 3.8%
Pre-opening
expenses 0.3% 0.3% 0.2% 0.2%
------------- ---------- ----------- -----------
Operating profit 1.5% 2.8% 1.6% 2.5%
Interest expense, net -0.8% -1.6% -1.0% -1.4%
Equity in net loss
of Barnes & Noble.com -1.4% -2.0% -1.4% -2.0%
Other expense, net -0.5% -0.1% -0.4% -0.2%
------------- ---------- ----------- -----------
Loss before taxes -1.2% -0.9% -1.1% -1.1%
Income taxes -0.5% -0.4% -0.5% -0.5%
-----------------------------------------------
Net loss -0.7% -0.5% -0.7% -0.6%
===============================================
(1) Includes Calendar Club sales of $5,551 and $6,083 for the 13 and
39 weeks ended November 3, 2001, respectively.
(2) Includes Calendar Club operating losses of $3,217 and $7,956 for
the 13 and 39 weeks ended November 3, 2001, respectively. Includes
Calendar Club operating losses of $1,428 and $4,430 for the 13 and 39
weeks ended October 28, 2000, respectively.
BARNES & NOBLE, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(thousands of dollars, except per share data)
November 3, October 28, February 3,
2001 2000 2001
-----------------------------------------------
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 25,097 36,609 26,003
Receivables, net 119,022 88,294 84,505
Merchandise inventories 1,591,583 1,454,945 1,238,618
Prepaid expenses and
other current assets 106,473 72,575 106,127
----------------------------------------
Total current assets 1,842,175 1,652,423 1,455,253
----------------------------------------
Property and equipment:
Land and land improvements 3,247 3,247 3,247
Buildings and
leasehold improvements 452,895 438,114 436,289
Fixtures and equipment 762,552 658,887 682,444
----------------------------------------
1,218,694 1,100,248 1,121,980
Less accumulated
depreciation and
amortization 653,231 522,387 555,760
----------------------------------------
Net property and equipment 565,463 577,861 566,220
----------------------------------------
Intangible assets, net 346,042 420,136 359,192
Investment in
Barnes & Noble.com 94,509 186,092 136,595
Other noncurrent assets 38,550 63,322 40,216
----------------------------------------
Total assets $2,886,739 2,899,834 2,557,476
========================================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 894,955 865,203 582,075
Accrued liabilities 240,456 196,631 353,000
----------------------------------------
Total current liabilities 1,135,411 1,061,834 935,075
----------------------------------------
Long-term debt 775,100 820,300 666,900
Deferred income taxes 68,733 123,491 74,289
Other long-term liabilities 105,432 94,776 103,535
Shareholders' equity:
Common stock; $.001 par
value; 300,000,000 shares
authorized; 72,667,730,
69,814,985 and 70,549,176
shares issued, respectively 73 70 71
Additional paid-in capital 725,326 658,340 673,122
Accumulated other
comprehensive loss (13,706) (3,334) (5,874)
Retained earnings 207,747 261,734 227,735
Treasury stock, at cost,
5,504,700 shares (117,377) (117,377) (117,377)
----------------------------------------
Total shareholders' equity 802,063 799,433 777,677
----------------------------------------
Commitments and contingencies - - -
----------------------------------------
Total liabilities and
shareholders' equity $2,886,739 2,899,834 2,557,476
========================================
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