Hastings: Movie, TV Disc Revenue Up Slightly Since 201121 Apr, 2014 By: Erik Gruenwedel
Packaged-media sellthrough offsets rental declines
While Hastings Entertainment has seen rentals of movies and TV shows decline due to growth in subscription streaming and Redbox kiosks, it continues to generate revenue from the sale of packaged media.
Indeed, the Amarillo, Texas-based operator of 126 stores throughout the Southwest saw revenue from new Blu-ray Disc and DVD increase 2% to 23% ($100 million) of total sales in 2013 from the same period two years ago, according to an April 21 regulatory filing.
At the same time, rental revenue declined 2% to 12.9% ($59.8 million) of the $435.9 million in 2013 revenue. Same-store movie sales increased primarily due to enhanced sales of Blu-ray titles, traditional and boxed set DVDs — partially offset by declines in sales new, previously viewed and used mid-priced DVDs.
Meanwhile, rental comps decreased due to fewer turns of DVDs and video games, partially offset by increased rentals of Blu-ray movies. Rental movie comps decreased 10.6%, as sales were negatively impacted by rental kiosks and subscription streaming such as Netflix, Hulu Plus and Amazon Prime Instant Video, while rental video game comps, which were impacted by the longevity of the current console cycle, decreased 28.4%.
Pending shareholder approval, CEO John Marmaduke will sell Hastings for $21.4 million to investor Joel Weinshanker, owner of National Entertainment Collectibles Association, with shareholders receiving $3 in cash per share of common stock.
Upon completion of the sale, Marmaduke and CFO Dan Crow will resign their respective positions, with Crow staying on as a consultant.