CORRECT: UPDATE: Borders 2Q Loss Widens Sharply On Charges
25 Agosto 2009 - 4:03PM
Dow Jones News
Borders Group Inc.'s (BGP) fiscal second-quarter loss widened
sharply on restructuring charges as the bookseller made operational
changes that hurt short-term sales, although the company's
turnaround appears to be making progress.
The most recent period was one of transition as the company made
big changes in reducing space and inventory, said Chief Executive
Ron Marshall in a statement.
Marshall acknowledged the recession is not the only cause of the
company's woes, saying he has "a laundry list" of changes to make,
like more promotions and crisper in-store operations to improve
sales.
Investors appear to be responding, with shares recently up 7.8%
to $3.99 in premarket trading.
The second-largest bookstore chain in the U.S. behind Barnes
& Noble Inc. (BKS) has cut its inventory and capital
expenditures because of weak consumer spending.
For the quarter ended Aug. 1, Borders posted a loss of $45.6
million, or 76 a share, compared with a loss of $9.2 million, or 15
cents a share, a year earlier. The latest results included 55 cents
a share in restructuring and other charges.
Revenue decreased 18% to $624.7 million. Same-store sales at
U.S. Borders superstores decreased 18%, while the figure fell 11%
at the mall-based Waldenbooks segment, which the company has been
shrinking. International sales rose 10% excluding currency
changes.
Gross margin fell to 22.9% from 24%.
Borders shares have soared from their Christmas Eve low of 34
cents but remain 30% below prior-year levels.
-By Karen Talley, Dow Jones Newswires; 212-416-2196
(Joan E. Solsman contributed to this article.)