Barnes and Noble e-book and ereader sales are on the rise and earlier this week I talked about the bookseller is starting to cut costs and turn their business around. B&N has just issued their financial results for the past three months today and the news is quite good. They have reported that Nook sales generated $600,000 in profit, an $8.6 million improvement over the prior year on expense reductions. NOOK sales decreased 28% on lower content volume as well as lower average device selling prices. Both digital content and online sales benefitted in the prior year from the eBook settlement.
Is it possible that the days of announcing $3 million or $7 million or $20 million dollar in losses each quarter in the NOOK division are in the past?
B&N today reported sales and earnings for its fiscal 2018 first quarter ended July 29, 2017.
Total sales for the first quarter were $853 million, declining 6.6% as compared to the prior year. Comparable store sales decreased 4.9%, as declines in non-book categories outpaced improved book trends during the quarter. The Company also experienced lower online and NOOK® sales during the quarter, which were impacted by the prior year eBook settlement and lower promotional activity.
The consolidated first quarter net loss improved to $10.8 million, or $0.15 per share, compared to a loss of $14.4 million, or $0.20 per share, in the prior year.
The consolidated first quarter operating loss of $15.2 million improved $6.2 million versus the prior year. Retail incurred an operating loss of $12.5 million, while NOOK incurred an operating loss of $2.7 million.
Consolidated first quarter EBITDA was $11.2 million, as compared to $9.6 million a year ago. NOOK generated EBITDA of $0.6 million, an $8.6 million improvement over the prior year on expense reductions. Retail EBITDA of $10.6 million decreased $7.0 million primarily due to the comparable store sales decline, somewhat mitigated by expense reductions.
“Our first quarter earnings results improved over the prior year, as we were able to mitigate the sales decline through expense reductions,” said Demos Parneros, Chief Executive Officer of Barnes & Noble, Inc. “We expect to improve our performance in the back-half of the year, which coupled with our focus on expense reduction, will enable us to achieve EBITDA of $180 million.”
For fiscal year 2018, the Company continues to expect comparable bookstore sales to decline in the low single digits and full year consolidated EBITDA to be approximately $180 million.
Michael Kozlowski is the Editor in Chief of Good e-Reader. He has been writing about audiobooks and e-readers for the past ten years. His articles have been picked up by major and local news sources and websites such as the CBC, CNET, Engadget, Huffington Post and the New York Times.