Hastings Q4 Income Up, Comps Down27 Mar, 2006 By: Jessica Wolf
Hastings Entertainment reported modest income growth even in the face of comp-store declines for the final fiscal quarter of 2005 (ended Jan. 31, 2006). The company also announced a new stock repurchase program.
Net income for fourth-quarter 2005 was approximately $7 million, compared to approximately $4.8 million for the fourth quarter of fiscal 2004. Net income was approximately $5.7 million in fiscal 2005, compared to approximately $5.8 million for fiscal 2004.
Comp-store sales were off 1.4% for the year and 0.6% for the fourth quarter. Rentals were off even more on a comp-store basis, down 4.2% for the quarter and 7.5% for the year.
For the year, both music and book sales dropped on a comp-store basis, down 1.8% and 0.2%, respectively. Video sales comps rose 1.9% due to increased sales of DVD and DVD boxed sets, which were partially offset by declining VHS sales. Video game comps rose 5.2% on increased sales of new and used hardware.
“We're pleased with our operating results in the fourth quarter,” said John Marmaduke, chairman and CEO of Hastings. “In spite of the continued weakness in the music and in store video rental industries, we were able to increase our pretax earnings buy $4.1 million or 50%.”
Total revenue for the fourth quarter decreased $1.6 million, or 0.9%, to $171.5 million.
Total revenue for 2005 decreased $4.1 million, or 0.8%, to $537.9 million.
Hastings' board of directors March 15 authorized a stock repurchase program in the amount of $5 million, which will approximate 8.5% of the company's outstanding stock.
“We believe our current stock price does not reflect our long-term value, and that this repurchase program is in the best interest of our shareholders,” Marmaduke said.