At Hastings Entertainment, total revenue in the fourth quarter ended January 31 fell 1.5% to $171.5 million and net income rose 13.7% to $5.8 million. For the full year, total revenue fell 0.1% to $547.7 million and net income rose 104.1% to $10.2 million.
Fourth-quarter sales at stores open at least a year dropped 1%. Comp-store sales of books rose 0.9% in the quarter, mainly because of increased sales of used and value books, "partially offset by lower sales of new hardbacks." Movies and music comp-store sales were down; all other categories, led by video games, cafe business and electronics, had gains.
For the year, comp-store book sales rose 2.1%, mainly because of Harry Potter and the Deathly Hallows and "strong sales of used books."
In a statement, CEO John Marmaduke said that he was pleased with results considering that "the retail industry faced its weakest holiday sales period since 2002, followed by a sluggish January. In spite of a challenging retail environment, our sales remained relatively flat." Pre-tax profits rose because of the company's "continued focus on margin management and cost controls."
Marmaduke predicted that the year will be "difficult" for retailing but that the company expects to increase pre-tax profits by 16%. Hastings is responding to the "challenging" state of music sales by reformatting 35 of its 153 stores so that the music departments will be reduced 15%-20% and adding "new products" and expanded "inventory in other departments, including Trends and Children's products."
During the fourth quarter, Hastings opened a 24,612-sq.-ft. store in Cordova, Tenn., its first in the Memphis area. Hastings plans to open three new stores during the fiscal year and expand or relocate six stores. Hastings expects comp-store sales to rise in the "low single digits" during the year.