Fourth Quarter Boosts Chain Sales

A solid fourth quarter, in which revenue rose 5.6%, helped give the nation's three largest bookstore chains a 4.4% sales increase for the year ended January 31, 2006. Total sales for the year hit $9.69 billion. All of the major retailers—Barnes & Noble, Borders Group and Books-A-Million—reported stronger increases for the final period than they did for the entire year. This was especially true at Borders and BAM.

BAM had the largest sales increase among the chains for 2005, with revenue up 6.3%, to $503.8 million, and net income ahead 28%, to $13.1 million. The 8.1% sales increase in the fourth quarter was driven by solid gains in BAM's core book business, said president Sandy Cochran. Although BAM, like B&N and Borders, reported no breakout hit in the fourth quarter, Cochran said titles related to the Chronicles of Narnia and Harry Potter and the Goblet of Fire film releases drove sales in the children's segment, while Eragon, Eldest and the Travelling Pants series led teen fiction sales. Food Network personalities, most notably Rachael Ray and Paula Deen, led good gains in cooking, while Bibles, Your Best Life Now and ThePurpose-Driven Life led the religion category. Nine of the 10 bestsellers in the games category were sudoku books.

Cochran said that while BAM had maintained some "positive momentum" from the holidays, the lack of a new John Grisham novel could curtail growth in the first period. BAM (and its larger competitors) is looking forward to the paperback release of The Da Vinci Code, Game of Shadows and new cookbooks from Ray and Deen.

Bookstore Chains Sales, 2004—2005
($ in millions)