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Online Unit Costs Barnes & Noble Profit

November 20, 1998|From Times Wire Services

Barnes & Noble Inc. reported a wider-than-expected loss for its fiscal third quarter as expenses at its fledgling Internet unit offset higher sales at its chain of large bookstores.

The largest U.S. bookseller lost $4.59 million, or 7 cents a share, compared with net income of $65,000, or break-even on a per-share basis, a year ago. Analysts were expecting, on average, a loss of 3 cents.

Total revenue rose 9.6% to $674.1 million. Sales from Barnes & Noble's superstores, which account for more than 82% of revenue, rose 11% to $554 million. Sales at Barnes & Noble stores open at least a year rose 4.5% and fell 1% at B. Dalton stores.

Sales at the Internet site more than quadrupled to $17.2 million, but the costs of marketing and developing the site have exceeded sales, resulting in a loss at the unit. The site competes with bigger Internet rival, which is also losing money.

Profit at the New York-based company's traditional stores more than doubled to $7.5 million, or 11 cents a share, beating expectations of 8 cents.

At a Glance

Other earnings, excluding one-time gains and charges unless noted:

* Brown Group Inc., which owns Famous Footwear and Naturalizer stores and licensed brands such as Dr. Scholl's, said its earnings jumped 67% in the fiscal third quarter to $12.9 million, or 72 cents a diluted share, topping forecasts of 69 cents. Sales slipped 5% to $412 million.

* Neiman Marcus Group Inc. said its fiscal first-quarter profit fell 23% to $25 million, or 50 cents a share, but it beat estimates of 42 cents and said cost-cutting and other measures should enhance performance throughout the fiscal year. Revenue rose 1% to $587.1 million. Same-store sales fell 2.3%.

* Sunglass Hut International Inc., said it is closing about 10% of its stores as it reported a loss on disappointing sales. The world's largest sunglasses retailer said its loss in the fiscal third quarter narrowed to $4 million, or 8 cents a share, from $5.1 million, or 9 cents, a year ago. Sales rose slightly to $122.8 million from $122.4 million, and same-store sales edged down 0.5%. Sunglass Hut said it has closed 149 stores that were underperforming or unprofitable and will close up to 76 more, including some Watch Station outlets, by the end of January.

* Venator Group Inc. said price cuts and continued slow demand for athletic apparel led to a wider-than-expected fiscal third-quarter loss and will cut next quarter's profit below forecasts. Venator, whose stores include Foot Locker and Champs Sports, posted a loss from continuing operations of $40 million, or 29 cents a share, compared with profit from continuing operations of $50 million, or 37 cents, a year ago. Analysts were expecting a loss of 24 cents. Revenue rose 1.4% to $1.12 billion. Same-store sales dropped 5.3%.

* Wet Seal Inc. reported better-than-expected earnings for the fiscal third quarter of $5.42 million, or 41 cents, down 1% from a year ago, as sales at its stores jumped 16% to $121.6 million. The company had warned in September that weak demand for back-to-school clothes would push earnings below estimates that were then 48 cents a share. The warning prompted analysts to adjust their forecasts to an average 38 cents.

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