In one of the worst retailer environments for books in 30 years, Hastings Entertainment managed to post a 2.8% increase in book sales in the fiscal year ended January 31, the multimedia retailer said in its 10-k filing with the Securities and Exchange Commission. Book sales were $123.7 million last year and represented 23% of Hastings's total revenue, up from 22% in the previous year, putting books just ahead of video as Hastings's biggest product segment. Music share of sales fell from 17% in 2007 to 15% last year; in 2006 music accounted for 20% of revenue.
The increase in book sales came from gains in both new and used titles, and comp sales increased 1.3%. Hastings's stores now carry between 3,000 and 26,000 used books, and sales of all used and budget items represented 15.6% of total revenue last year compared to 11.2% in 2007. Earlier this year, Hastings reported that total revenue fell 1.6%, to $538 million, and earnings fell 60%, to $4.1 million. To help reduce expenses last year, Hastings eliminated about 9% of the workforce in its corporate office, which now has 236 employees. The retailer has also instituted a wage freeze for all employees and is cutting capital expenditures by $10 million in 2009.
While Hastings said it expects a decline in same-store sales in this year, it will go ahead and open two new stores and relocate three outlets while closing two locations. With retail weak and many stores closing, Hastings said it has been able to renegotiate with landlords to reduce future rents and, as of March 31, had secured $1.3 million in reductions that will be realized over the life of the leases.
A redesign of its Web site (gohastings.com) is also in the works. The new site will have updated branding, expanded product availability (2.8 million items) and improved searching and browsing features as well as more interactivity.