Trans World CEO Eying Disc Sales Uptick in Second Half22 Aug, 2013 By: Erik Gruenwedel
Parent of f.y.e. said Best Buy’s reduced shelf space for packaged media portends growth opportunity for the entertainment retail chain
Trans World Entertainment CEO Bob Higgins said it is too early to say whether Best Buy’s shrinking shelf space for packaged media, including movies and TV shows, has resulted in increased sales at its 355 f.y.e. (For Your Entertainment) stores.
Speaking Aug. 22 during the company’s second-quarter results, Higgins said f.y.e. is readying for an aggressive retail push in the second half of the year by targeting packaged media sales recently shunned by Best Buy.
“We feel we picked up a minor amount [disc sales] from Best Buy, but it is too hard to tell [definitively],” Higgins said. “I think we’ll know better in the next six months.”
Indeed, same-store video comps declined 3% in the quarter, due primarily to a lack of new releases. DVD and Blu-ray Disc represented 44% of TWEC’s $80.5 million revenue during the quarter, compared with 43% of $91 million during the previous-year period.
Trans World reported a net loss of $2.5 million in the quarter, compared with a net loss of $1.9 million for the same period last year.
Music comps declined 7%, but was a notable improvement from a 16% decline in the first quarter. Management attributed the uptick to new releases and improved catalog sales.
The lone bright spot was the trend category, which improved 19% year-over-year and included entertainment-related merchandise. Electronics declined 13%, which management attributed to increased competition in headphones and overall softness in the CE industry. Video games were down 11% in the quarter and represented 3% of total sales, compared with 4% last year.
“The trend category highlights our unique ability to sell entertainment-related merchandise from non-media categories,” Higgins said.
Trans World opened seven stores in the quarter and closed five. It ended the period with $95 million cash, compared with $58 million last year. The surplus prompted management to authorize a $22 million share repurchase program.