Barnes & Noble Inc. Chairman and founder Leonard Riggio said the bookstore chain is suffering from the one of worst retail environments in decades after traffic in stores hit “close to a historic low point.”
The retail climate is “terrible,” he said on the company’s first-quarter earnings call Thursday. “Better put, is it is one of the worst I have ever experienced in the 50 years I have been in this industry.”
The remarks came after the New York-based company said revenue dropped 6.6 percent to $913.9 million last quarter. The average of two analysts’ estimates was $958.5 million.
The task of coping with that trend will largely fall to Riggio, 75, who’s taking back some day-to-day management duties after ousting Chief Executive Officer Ron Boire last month. Boire, who’d been CEO for less than a year, added more non-toy merchandise and announced plans for redesigned stores that include restaurants. Still, the measures failed to reverse Barnes & Noble’s long-term decline at the hands of Amazon.com Inc.
Riggio, who is serving as interim CEO, said he won’t “rush headlong” in the search for Boire’s replacement.
The net loss was $14.4 million, or 20 cents a share, in the quarter ended July 30, compared with a loss of $34.9 million, or 68 cents, a year earlier. Excluding some charges, the loss was 7 cents a share, less than the 18-cent loss estimated by analysts.
Same-store sales fell 6 percent in the quarter through July. Given that performance, the company cut its comparable sales forecast for the current fiscal year to a low-single-digit decline. Barnes & Noble had previously predicted the measure would range from little changed to up 1 percent.
“The current trend can be traced precisely to the current election cycle, which is unprecedented in terms of the fear, anger and frustration being experienced by the public,” Riggio said.
But the bookseller’s own missteps -- such as cutting too much inventory and reducing personnel on the sales floor -- also hurt results, he said.
The shares fell 1.8 percent to $12.13 at 12:25 p.m. in New York, paring an earlier decline of as much as 8.1 percent. Barnes & Noble, which operates 638 U.S. bookstores, had gained 42 percent this year through Wednesday.
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