In its first year operating as a standalone company, Barnes & Noble Education reported a 1.7% increase in revenue for the year ended April 30, 2016, over fiscal 2015. Revenue rose to $1.80 billion from $1.77 billion. B&N Education was spun off from Barnes & Noble, Inc. last August.
A number of one-time charges, however, led to a drop in net income, from $19.1 million in fiscal 2015, to $84,000 in fiscal 2016. The extraordinary charges reflected strategic shifts made by B&N Education during the year, most importantly moving its digital education platform from its in-house built Yuzu eTextbook site to Ingram's VitalSource. The switch led B&N Education to shut the Yuzu offices in Mountain View, Calif. and Redmond, Wash. which resulted in the elimination of jobs in those places.
To account for the closures and staff reductions, B&N Education recorded restructuring costs of $8.3 million last year and a $12.0 million impairment charge related to its digital businesses. B&N Education (when it was part of B&N) invested more than $30 million to develop Yuzu. To complement the move to VitalSource, in March B&N Education paid $17.9 million to buy LoudCloud, a digital platform and analytics provider.
B&N Education said that the revenue gain in the year was due to the opening of 39 new college stores with estimated annual sales of $64 million. The company operated 751 locations as of April 30, 2016. Comparable store sales fell 1.9% in the year due almost entirely to a decline in sales in its stores at community colleges. Textbook rental income held even at about $228 million.
Looking ahead to the current fiscal year, B&N Education expects total sales to increase 2.0% to 4.0% due to the addition of 32 new stores. Comparable store sales are expected to be approximately flat to a decline of 2.0% compared to fiscal 2016.