Blockbuster Q3 same-store sales rise

Company ‘expresses comfort’ with analysts’ estimates

By Danny King -- Video Business, 10/22/2008

OCT. 22 | Blockbuster said today that it “expressed comfort” with analysts’ fiscal third-quarter estimates, as both total U.S. same-store sales and U.S. same-store rental revenue increased from a year earlier.

U.S. same-store sales rose 5.1% for the quarter, while same-store rental revenue edged up 0.8%, the largest U.S. movie-rental chain said in a statement today.

Analysts in a Thomson Financial poll expect the company to lose about 16¢ a share on $1.28 billion in sales, which would represent a 2¢ a share loss narrowing and a 3.2% rise in sales from a year earlier.

Blockbuster will release its fiscal third-quarter report on Nov. 6.

The company appears to have bucked the U.S. trend of declining revenue stemming from DVD sales and rentals. For the first three quarters of the year, U.S. consumers spent $14.25 billion on sell-through and rentals, down 2.4% from a year earlier, according to data compiled by Video Business and Rentrak.

“As a result of the initiatives we have put in place, the company delivered its third sequential quarter of positive domestic same-store sales, an especially significant achievement in today's retail environment,” Blockbuster CEO Jim Keyes said in the statement.

Blockbuster has been trying to compete with companies such as Netflix and Amazon.com while augmenting its in-store sales with Internet-ordering services such as the Total Access program it launched in late 2006 and its Movielink video-download service. Movielink was integrated into Blockbuster's Web site in July, almost a year after Blockbuster bought the service from the five major studios for $6.6 million.

The company also said today that it declared a quarterly cash dividend of $18.75 a share on its convertible preferred stock, the same as a quarter earlier.