Borders Group Reports Holiday Sales Results
ANN ARBOR, Mich., Jan. 18 /PRNewswire-FirstCall/ -- Borders Group, Inc. (NYSE: BGP) today reported results for the 11-week holiday period ended Jan. 16, 2010. Total consolidated sales were $846.8 million, a 13.7% decrease compared to the same period last year.
Within the Borders superstore segment, total sales for the period were $649.2 million, a 14.7% decrease from a year ago. Comparable store sales at Borders superstores declined 14.6%. Factoring out multimedia, comparable store sales at Borders superstores declined 10.9%. The company reduced promotional spending in December, and as a result, gross margins for the month improved 130 basis points compared to a year ago.
Within the Waldenbooks Specialty Retail segment, total sales for the holiday period were $153.2 million, a 14.6% decrease year over year. Comparable store sales for Waldenbooks stores that will remain open beyond the end of this month declined 9.4%.
Excluding currency impact, total International segment sales were $44.4 million for the period, an 8.7% increase. Comparable stores sales at Paperchase stores outside the U.S. increased by 10.1% for the period.
"We are disappointed with holiday results and must intensify our focus on creating and delivering a shopping experience that drives profitable sales," said Borders Group Chief Executive Officer Ron Marshall. "Given the sales challenge, we have continued to manage cash flow and have taken several important steps in line with our strategic priorities, including moving away from underperforming, low margin categories such as music and video in favor of better performing categories such as children's. The decision to exit multimedia is right long-term, but impacted comp store sales by 3.7%. In addition, as previously announced, we are right-sizing the mall business with the closure of 182 Waldenbooks Specialty Retail stores. We have continued to expand our Borders Rewards loyalty program and recently announced digital book partnerships with Kobo and Spring Design that position Borders to be a high quality content provider of eBooks. We will continue to focus on reducing expenses and improving working capital to drive improved cash flow and debt reduction as we address the clear priority to drive profitable sales."
About Borders Group
Headquartered in Ann Arbor, Mich., Borders Group, Inc. (NYSE: BGP) is a leading specialty retailer of books as well as other educational and entertainment items. The company employs approximately 25,000 throughout the U.S., primarily in its Borders(R) and Waldenbooks(R) stores. Online shopping is offered through borders.com. Find author interviews and vibrant discussions of the products we and our customers are passionate about online at facebook.com/borders, twitter.com/borders and youtube.com/bordersmedia. For more information about the company, visit borders.com/media.
Safe Harbor Statement
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. One can identify these forward-looking statements by the use of words such as "expect," "planning," "possibility," "opportunity," "goal," "will," "may," "intend," "anticipates" and other words of similar meaning. One can also identify them by the fact that they do not relate strictly to historical or current facts. These statements are likely to address matters such as the company's future financial condition and performance (including earnings per share, the profitability of Waldenbooks, liquidity, cash flows, debt levels, sales, inventory levels and capital expenditures), its cost reduction initiatives and plans for store closings and the expansion of product categories. These statements are subject to risks and uncertainties that could cause actual results and plans to differ materially from those included in the company's forward-looking statements.
These risks and uncertainties include, but are not limited to, consumer demand for the company's products, particularly during the holiday season, which is believed to be related to general economic and geopolitical conditions, competition and other factors; the availability of adequate capital--including vendor credit--to fund the company's operations and to carry out its strategic plans; adverse litigation results or other claims and the performance of the company's information technology systems.
The company's periodic reports filed from time to time with the Securities and Exchange Commission contain more detailed discussions of these and other risk factors that could cause actual results and plans to differ materially from those included in the forward-looking statements, and those discussions are incorporated herein by reference. The company does not undertake any obligation to update forward-looking statements.
SOURCE Borders Group