Hastings Cites Weak Release Slate, Economy for Loss17 Nov, 2008 By: Erik Gruenwedel
A dearth of major theatrical releases, competition from the Summer Olympics and the current economic meltdown contributed to Hastings Entertainment posting a third-quarter (ended Oct. 31) fiscal 2007 loss of $3.7 million, compared to income of $100,000 during the prior-year period.
The Amarillo, Texas-based retail chain with 153 locations said same-store (open at least 12 months) rental comps, which include new and used video games, fell 13.3%, compared to a 1.4% decline last year.
Rental revenue topped $18 million, compared to $20 million last year.
Rental comps for the first nine months of the fiscal year edged down 2.3% due to increases in video game and Blu-ray movie rentals offsetting declining DVD rentals, the retailer said.
DVD sales decreased 5%, compared to an increase of 7.6% last year. Video game comps fell nearly 15%, compared to an increase of 34% last year.
The retailer said the lack of comparable video game title releases to last year’s release of Halo 3 contributed to the decline.
Through the first nine months, movie comps are up 0.3%, compared to an increase of 7.5% during the same period last year.
Music CD comps fell 19.5% (versus 14.8%) as Hastings continues an industry-wide trend downsizing music shelf space.
Bright spots included electronics, which increased 12.7% (down from 30.8% last year), due to strong sales of digital converter boxes and third-party gift cards.
“In an effort to drive sales without the benefit of significant video releases, we were highly promotional during the month of October,” CEO John Marmaduke said in a statement. “Obviously we are concerned about the fourth quarter in light of the current economic climate.”
Overall revenue totaled $114 million, compared to $122 million last year. Total same-store comps declined 6.5%, compared to an increase of 2.8% last year.