From Flat to Worse at Chains

The three big box retailers show sales drops in Q2

by Staff -- Publishers Weekly, 8/28/2006

Borders was the last of the three bookselling chains to weigh in with its second quarter results, and its numbers managed to deepen the malaise already established. While sales at Barnes & Noble dipped 1.2% in the quarter, and Books-A-Million had a slight 0.7% decrease, Borders saw a full 4% drop, with sales checking in at $856 million.

Borders posted a loss for the quarter of $18.4 million, or 29 cents a share, as opposed to a narrow $1.3 million profit in last year's second quarter. While freshly minted CEO George Jones blamed the drop in sales on a poor performance in the music sector—where there was an 18% drop, compared to 3% in books—he was hopeful that book sales would pick up significantly this fall. Despite expectations of a further drop in share price of 60–75 cents in the third quarter, Jones looks forward to upbeat sales in the fourth quarter, with new titles due from bestselling stalwarts like Mitch Albom and John Grisham.

At Barnes & Noble, a poor performance from hardcovers was partly blamed for the lack of growth; specifically, the lack of a Harry Potter–like hit this summer hurt. B&N's six-month sales for 2006, at $2.27 billion, were virtually the same as last year. CEO Steve Riggio also expressed enthusiasm about the possibility of a strong fall season.

Books-A-Million chief Sandra Cochran mentioned the hoped-for traffic that the forthcoming final installment of the Lemony Snicket series might bring. BAM, which saw a slight sales decline but posted an earnings increase (up 44%, to $2.4 million), was helped out by hits in the Bible market and Christian fiction. Cochran also cited strong paperback sales of The Da Vinci Codeand graphic novels as bright spots for the period.