Barnes & Noble Q3 Profit Misses View, But Sales Top

(RTTNews) - Barnes & Noble Inc. (BKS) reported that its third quarter net earnings declined to $70.3 million, or $0.96 per share, from $80.3 million, or $1.04 per share last year. For the quarter, Analysts polled by Thomson Reuters expected the company to report earnings of $1.13 per share for the quarter. Analysts' estimates typically exclude special items.

Retail generated operating income of $135.0 million, while NOOK incurred an operating loss of $6.2 million, for a total operating income of $128.8 million.

Total sales for the third quarter were $1.30 billion, declining 8.0% as compared to the prior year. Analysts expected revenue of $1.28 billion for the quarter.

Retail sales, which include Barnes & Noble stores and BN.com, declined 7.5% to $1.3 billion for the quarter. Comparable store sales declined 8.3% for the quarter largely due to lower traffic, as well as the decline in coloring books, artist supplies and last year's best-selling album by Adele, which collectively accounted for nearly one third of the sales decline. Online sales increased 2.2% for the period. NOOK sales, which include digital content, devices and accessories, declined 25.7% to $38.4 million for the quarter.

Despite sales improvements post-holiday, trends softened in late January and into the fourth quarter. As a result, the Company now expects full year fiscal 2017 comparable store sales to decline approximately 7%, and consolidated EBITDA to be in a range of $180 million to $190 million, excluding the impact of any charges related to its cost reduction initiatives and costs associated with the CEO departure. Fiscal 2017 Retail EBITDA is now expected to be in a range of $200 million to $210 million, while NOOK's EBITDA loss has improved and is now expected to be approximately $20 million, which includes previously announced transitional costs.

Barnes & Noble noted that it will report fiscal 2017 fourth quarter results on or about June 22, 2017.