Barnes & Noble’s third quarter results, reported this morning, show the trickiness of navigating this transitional retailing (and etailing) climate. Following their best holiday period in years, sales rose 7 percent and profits were within the company’s own guidance. Both measures were below analysts’ expectations, though, with profits down from a year ago, and the company is suspending its quarterly dividend of twenty-five cents per share. The dividend reduction was expected long ago, since the company is investing in its digital strategy and has financing the dividend through borrowings rather than earnings. But the combination of lower earnings and no […]
Finance
Court Approves Borders’ Store Closure Plan In Time for President’s Day Sales; BAMM Eyes Some Locations?
After a brief postponement from Wednesday, the bankruptcy court approved Borders’ store reduction program and the chain has finalized agreements with liquidators. Going-out-of-business sales will begin on Saturday, February 19, which allows Borders to take advantage of President’s Day Weekend, and the company expects the 200 previously identified stores to close by the end of April. Hilco Merchant Resources, SB Capital Group, Tiger Capital Group and Gordon Brothers Group won the bidding to handle the liquidation sales, striking a deal that Bloomberg reports would guarantee almost 86 percent of the cost value of merchandise at the stores. Merchandise that Borders […]
Who Else Benefits – Or Suffers – From Borders’ Bankruptcy?
In addition to the bankruptcy’s effect on book sales and publishers’ respective bottom lines, Borders’ Chapter 11 filing will have a domino effect on a number of related players, among them: LandlordsPublicly-traded Michigan-based Agree Realty was often cited as being in the most precarious position, because Borders stores made up approximately 20% of their total real estate portfolio (and was as high as 27%). Yesterday Agree released a statement indicating that 5 of the 14 Borders properties it owns (which includes company headquarters in Ann Arbor, up for sale, and two buildings not currently occupied by Borders) are slated for […]
Australia/New Zealand’s Dominant Bookstore Group Also Files for Bankruptcy
Bankruptcy is spreading through the world English-publishing world as Australia and New Zealand’s leading bookselling organization RedGroup Retail has been placed into voluntary administration by private equity owners PEP. The group comprises Angus & Robertson in Australia (with over 160 stores), Whitcoulls in New Zealand (with 65 stores), Borders in Australia (26 stores), New Zealand and Singapore, and the Calendar Club in both Australia and New Zealand. The combined entities employ approximately 2,500 people. The Age reported today that REDgroup “was forced to call in administrators to the businesses this afternoon following a board meeting.” All stores are slated to […]
Profits on the Rebound at Simon & Schuster; Magazine Says Random House May Slide
Sales at Simon & Schuster rose in the fourth quarter, up 5 percent to $231.7 million, but even with that improvement sales for the full year fell just below last year’s weak total, at $790.8 million falling $2.7 million below 2009’s mark. But strong fourth quarter profits of $20.1 million in OIBDA (up from $15.2 million a year ago) lifted income for the full year to $71.8 million, a 33 percent improvement over 2009. Operating income showed similar improvement, at $17.9 million for the fourth quarter, and $64.6 million for the full year. The company did record an unspecified “increased […]
Ingram Isn’t Shipping to Borders for Now
Though Ingram had supplied Borders with books even after the bookseller stopped paying publishers, the wholesaler tells us via spokesperson Keel Hunt that “Ingram is currently not shipping to Borders as they are working through the bankruptcy process. We look forward to helping them through the restructuring as the process allows.” Separately, Ingram ceo Skip Prichard said in a general statement earlier on Wednesday, “This is regrettable news for the whole book industry, obviously, but I hope the filing can give Borders a chance to reorganize, re-define and re-emerge to be successful for a long time to come. Borders and […]