Total revenue rose 3% at Indigo Books & Music in the year ended March 28, 2015 over fiscal 2014, with sales hitting C$895.4 million. The higher sales helped the Canadian retailer cut is loss from $31 million last year to $3.5 million in fiscal 2015.
Solid increases in comparable store sales and good gains in online sales drove the revenue increase. Comp sales as its superstores increased 6.8%, while same store sales at Indigo’s smaller format stores rose 0.8%. Online sales increased 11.8%. The increases in comp sales offset a decline in the number of Indigo stores, which declined by eight stores in the year.
Indigo has been diversifying its inventory mix and noted that in the year its nonbook categories had double-digit growth while the core book business “returned to growth despite having no major hits during the year.” Sales through the American Girl boutique “far exceeded” expectations, the retailer said.
Commenting on results, CEO Heather Reisman said, "We're pleased with our full year results which confirm we are moving out of transformation and into growth mode."
According to Reisman, Indigo saw growth for the company’s core book business for the first time since the advent of e-reading, and also saw “meaningful growth” in its lifestyle and Indigo Kids businesses. “Employees are motivated and excited about the journey, and in total there’s just a good feeling that Indigo is poised for a very interesting stage in our development,” she said.
Indigo also saw almost $28 million more in revenue than the previous year, despite offering four fewer large-format superstores and four fewer small-format stores. Reisman announced plans to open a new store in Toronto’s Sherway Gardens shopping mall in early 2016, and said Indigo is “looking for opportunities” to open new stores. “We are actively back in the market, though we have nothing to announce right now, other than the Sherway store,” said Reisman.
She confirmed Indigo will open four additional American Girl boutiques later this year, in addition to the two existing boutiques. The new locations — in Vancouver, Toronto, Edmonton, and Calgary — will be approximately 2,000 square feet each, comparable to the existing locations, and there is the potential for several more boutiques in the future.