B&N does better than expected Q2

NEW YORK, N.Y. Barnes & Noble reported better than expected sales and earnings for the second quarter ended Aug. 1.

Total sales for the second quarter were $1.2 billion, a 5% decrease compared with the prior year. Barnes & Noble store sales decreased 5% to $1 billion, with same-store sales decreasing 6.9% for the quarter, within the company’s guidance for a decrease of 5% to 7%. Barnes & Noble.com sales were $102 million for the quarter, a 2% increase compared to the prior year.

Second quarter net earnings were $12.3 million, or 21 cents per share. Included in net earnings was an after-tax cash benefit of $4 million, or 7 cents per share, resulting from an insurance settlement. Excluding this benefit, second quarter net earnings would have been 14 cents per share, compared with guidance of 5 cents to 15 cents per share.

“Due to strong expense management and improved gross margins we achieved earnings per share near the high-end of guidance. While the decline in retail traffic continues to be the principal impediment to our top line, we do offer our customers the ability to shop with us online, where sales were slightly above last year," said Steve Riggio, chief executive officer of Barnes & Noble. “We remain focused on working capital management, which resulted in solid free cash flow and no borrowings on our credit facility for the second quarter.”

For the third quarter, the company expects same-store sales at Barnes & Noble stores to decline 1% to 3%. The company continues to expect full-year comparable-store sales to decline 3% to 5%.