Borders widens fiscal Q1 loss

By Susanne Ault -- Video Business, 5/30/2007

MAY 30 | Although generating flat sales compared to last year, Borders’ DVD category was among its better performing product areas during its fiscal 2007 first quarter.

The book chain reported a $35.9 million net loss for the three-month period ended May 5. That is widened from the $20.2 million Borders posted in the comparable 2006 period.

Revenue rose 2% to $876.8 million.

Borders officials noted that some softness can be attributed to slightly negative fall-offs in book sales and ongoing declines in music. DVD sales remained unchanged from the fiscal 2006 first quarter.

Gifts and stationary showed improvement on a comparable store basis.

Going forward, Borders CEO George Jones hopes the chain will soon begin to benefit from recent structural changes, which have included closing about a dozen Waldenbooks stores.

“Previously, we have reported that 2007 would be a year of transition as we execute our long-term strategic plan for the turnaround of the company,” said Jones. “Our first-quarter results were generally in-line with our internal expectations, although the current sales environment was more challenging than we anticipated, and that trend has continued.”

Borders adheres to accounting figures on a Generally Accepted Accounting Practices (GAAP) basis.