Hollywood Entertainment Posts First-Quarter Profit Despite Flat Same-Store Sales7 May, 2001 By: Hive News
Hollywood Entertainment Corp. posted a profit versus a loss for the year-ago period despite flat same-store sales in the first quarter endedMarch 31.
The retailer has also extended a loan payment deadline by one month toJune 5. Lenders agreed to the extension in order to give Hollywood more time to finalize a new credit facility with its 20-member bank group. As part of the deferral, the chain made a $1 million payment on May 5, thecompany reported.
Hollywood’s revenue for the quarter increased 7% to $342.2million, excluding Internet site Reel.com. While comparable overall revenue for stores open longer than one year was flat, the chain says same-store rental revenue alone climbed 2%.
First-quarter net income was $3.5 million, or 7 cents a share, compared with a year-earlier loss of $12.2 million, or 26 cents a share.
Like other public rental chains, Hollywood predicts a tough year-over-year comparison in the second quarter, due to last year’sstrong release slate that included titles such as The Sixth Sense, StarWars: The Phantom Menace and American Beauty. As a result, the Portland,Ore.-based retailer is expecting same-store sales to decline 4% to 5% in the second quarter, compared to a 7% increase in the year-ago period.
Same-store revenues are expected to turn positive in the second half, with expectations of a 1% increase in the third quarter and a 2% boost by the end of the year.
As of March 31, Hollywood operated 1,816 stores in 47 states, after opening four locations and closing six in the first quarter.