With sales at Barnes & Noble in the fiscal year ended April 28 dropping 6% compared to fiscal 2017 and a host of one-time charges contributing to a net loss of $125.5 million compared to net income of $22.0 million in 2017, CEO Demos Parneros acknowledged that fiscal 2018 was a “challenging year.” He said that some of the changes the company has made led to modest improvements in certain areas but told analysts during a conference call discussing the recent results that turnarounds take time. Parneros announced B&N’s latest strategic plan in March.

One of the most immediate effects of the new plan was that B&N cut expenses by $52 million in fiscal 2018, with about $40 million of that coming from eliminating 3,000 full-time retail positions as it created a new store labor model. According to B&N’s 10-K filing with the SEC, the company had 8,000 full-time retail employees as of April 28, down from 11,000 a year ago. The number of part-time employees remained at 15,000. ($16.2 million in severance payments were among B&N’s one-time charges.)

Continued cost cuts in the Nook unit, which included shrinking the workforce from 92 in April 2017 to 57 this year, also resulted in that unit posting its first-ever positive EBITDA (earnings before interest, taxes, depreciation, and amortization) in fiscal 2018, despite a 24% decline in sales compared to the previous year. Sales of digital content dropped 20.1% in the year, and device sales fell 34%. CFO Allen Lindstrom was reluctant to predict that Nook will be profitable again in fiscal 2019, noting that more cost cuts will be made but that the unit’s top line will continue to come under pressure.

Similarly, though B&N execs are confident that ongoing expense reductions will lift overall EBITDA in fiscal 2019 above that of fiscal 2018 (which, excluding one-time charges, was $145.5 million), they are not certain about when comparable store sales might start to grow. Parneros said that some sections are showing improvement but that “we can’t specifically state when the entire business will turn just yet.” Total comp store sales dropped 5.4% in fiscal 2018 compared to the previous year, with comp book sales falling 4%. Though the changes B&N made to its book offerings have led to some improvement (fourth-quarter book comps were down only 3.4%), Parneros is also unsure of when that segment of the business will turn comp positive.

B&N has seen an uptick in sales in its toys and games department and, with the closing of Toys R Us, will expand the section (it had talked about shrinking the section last fall to focus on books). B&N will also continue to tweak its café offerings, where comp sales were up in the second part of the year. The worst-performing categories—music and DVDs—will continue to have their space cut, and Parneros said that when B&N starts opening its new smaller stores, those sections could be eliminated entirely. Another weak 2018 performer was B&N’s online business, where sales fell 9.6% in the year because of a lower conversion rate among visitors to the site.

A new area that B&N will enter soon is back to school, with the company planning to carry such items as backpacks and water bottles, which it sees as a good fit with its summer reading programs. A revamped gifts section, which had a double-digit comp sales decline last year, should also be ready this fall.

The first of B&N’s five prototype stores—which will average about 14,000 sq. ft. each—will open this fall, Parneros said, adding that B&N’s store count in fiscal 2019 will increase beyond the 630 outlets the chain had at the end of fiscal 2018. During fiscal 2018, B&N closed six stores and opened three. Parneros noted that with B&N having about 100 leases coming up for renewal annually over the next several years, the company has a pipeline of new real estate options ready to go, and he emphasized that B&N will maintain a presence in its key markets.