Hastings Q1 Looking Up21 May, 2007 By: Billy Gil
Strong boxed set and previously viewed video sales at Hastings Entertainment contributed to a 4.9% increase in same-store (open at least a year) DVD revenue in the first quarter.
The company posted first quarter (ended April 30) profit of $2.5 million, up nearly $0.6 million from the same quarter of 2006.
Total quarterly revenues for the Amarillo, Texas-based retailer fell 2.6% to $128 million, from $131.4 million for the first quarter of fiscal 2006. Total comp-store revenue fell 3.9%.
“I am very encouraged with our results for the first quarter,” said Hastings CEO John Marmaduke. “We were able to increase net earnings by 29% over a strong first quarter of fiscal 2006 in spite of an extremely difficult retail environment, particularly in the in-store rental and music categories.”
Indeed, the company suffered a loss of 13% in same-store sales of music compared to the first quarter of 2006, and posted a same-store loss of 5.8% in video game sales attributed to reduced sales of new Xbox and Sony PlayStation games. However, electronics sales were up 17.5%, partially reflecting a reclassification within reporting categories, effective Feb. 1.
First-quarter rental video comps fell 6.9% from the same period last year, due to weaker industrywide in-store rental, lower-performing titles and a strategic reduction in late fees.
Total first-quarter gross profit increased 2.4%, to $47.7 million, from $46.6 million for the same period last year. The increase can primarily be attributed to improved margins in merchandise and rental, as well as lower markdowns and freight costs, partially offset by inventory shrinkage.
Hastings operates 154 stores throughout the United States, as well as the e-commerce Web site www.gohastings.com.