Indigo Books & Music, Canada's leading book retailer, reported strong results for its third quarter ended January 1, 2022. Revenue was $C430.7 million, a 17.9% hike over the same period in 2020, when revenue was $C365.4. With the increase in revenue, Indigo reported net earnings in the period of C$45.1 million, compared with C$30.7 million a year ago.
Retail revenue for the period, which is inclusive of orders fulfilled through omnichannel store pick-up, increased by C$67.7 million or 29.4% to C$298 million, compared with $230.4 million in 2021 – representing a 29.6% increase. The company cited strong sales of non-book lifestyle items, including toys, as well as sales to a “re-engaged core customer and a younger demographic influenced by the strength of the #BookTok community on TikTok” as reasons for the increase sales at retail.
Online sales, which surged during the pandemic, decreased by C$3.5 million or 2.8% in the quarter, to C$122.0 million compared with C$125.5 million in the same period last year.
In the quarter, the general merchandise segment accounted for 49.2% of all revenue compared to 48.3% for print merchandise, which includes books and magazines. The company also noted that December sales were impacted by the emergence of the Omicron variant of Covid-19, which restricted foot traffic in stores, particularly in Ontario where stores were limited to welcoming customers at half-capacity.
The company continues to operate 88 superstores, under the Indigo and Chatpers brands, and 85 smaller format stores, under the Coles and Indigospirit names, the same number as mid-2021. What is new was the move of employees at several more Indigo locations to vote to unionize, bringing the total number of unionized stores to six.
For the first nine months of fiscal 2022, revenue rose 19%, to C$841.5 million and the retailer had earnings of C$26.7 million compared to a loss of C$18.5 million in the first nine months of fiscal 2021.