Hastings Doubles Quarterly Profit21 May, 2012 By: Erik Gruenwedel
Hastings Entertainment May 21 reported first-quarter (ended April 30) net income of $833,000, up more than twice the net income of $413,000 during the previous-year period.
Amarillo, Texas-based Hastings operates 138 stores in the southwest selling (and renting) movies, music CDs, consumer electronics and trends.
Revenue dropped 7% to $115.5 million, compared with $124.1 million last year. The sales decline underscored ongoing challenges in physical media retail, including sales of movies, music and books, according to CEO John Marmaduke.
Same-store sales of movies narrowed to a 3.7% decline in the quarter compared to a drop of 6.5% during the same period last year.
Packaged media movie sales fell due to lower sales of new and used DVDs, along with DVD boxed sets, partially offset by an increase in sales of new and used Blu-ray Disc movies.
Movie rental revenue dropped 16.5% to $15.8 million from $19.5 million last year. Same-store rental comps decreased 15.4% for the quarter and were negatively impacted by a continued lower quality of new releases and by competitor rental kiosks and subscription-based rental services.
“Movies continue to be impacted by the increasing growth of rental kiosks [Redbox] and subscription-based services [Netflix, Amazon Prime and Hulu Plus] in movie rentals,” Marmaduke said in a statement.