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Media Contact:
Mary Ellen Keating
Senior Vice President,
Corporate Communications
Barnes & Noble, Inc.
(212) 633-3323
mkeating@bn.com

Investor Contact:
Andy Milevoj
Vice President,
Investor Relations
Barnes & Noble, Inc.
(212) 633-3489
amilevoj@bn.com

12/03/2015

Barnes & Noble Reports Fiscal 2016 Second Quarter Financial Results

New York, NY (December 3, 2015)—Barnes & Noble, Inc. (NYSE: BKS) today reported sales and earnings for its fiscal 2016 second quarter ended October 31, 2015.
 
Sales for the second quarter were $895 million, decreasing 4.5% as compared to a year ago.  The second quarter EBITDA loss was $20.5 million, which included a $10.5 million executive severance charge related to the Barnes & Noble College spin-off.  Excluding this charge, the EBITDA loss was $10.0 million, a $2.2 million improvement over the prior year.
 
The second quarter net loss from continuing operations was $27.2 million or $0.36 per share, compared to net loss from continuing operations of $5.1 million, or $0.16 per share, in the prior year.  The after-tax impact of the severance charge was $0.08 per share for the quarter.
 
Retail
Retail sales, which include Barnes & Noble stores and BN.com, were $861 million, decreasing 3.1% due to lower online sales, store closures and a 1% comparable store sales decrease.  Excluding NOOK products, comparable store sales decreased 0.5% for the quarter.
 
Retail EBITDA was $0.8 million, decreasing $23.4 million as compared to the prior year.  $10.5 million of the decrease was attributable to the severance charge, while the balance of the decrease was due to lower bookstore and online sales as well as bookstore wage increases.
 
NOOK
NOOK sales of $43.5 million decreased 31.9% due primarily to lower content sales.  NOOK EBITDA losses of $21.3 million declined $15.1 million versus the prior year as the company continues to reduce expenses.
 
Holiday Season Update 
Through Black Friday weekend, third quarter comparable store sales excluding NOOK products increased 1.1%.
 
“This holiday season, Barnes & Noble executed large-scale, nationwide events to create excitement and drive traffic to our stores,” said Ron Boire, chief executive officer of Barnes & Noble, Inc.  “Barnes & Noble’s buyers and merchants have curated an outstanding selection of books, toys and games and gifts, and our booksellers are prepared to help customers find the perfect gift for everyone on their holiday shopping list.”
 
Outlook
For fiscal year 2016, the Company continues to expect comparable store sales to be approximately flat with the prior year. Excluding NOOK products, comparable store sales are expected to increase approximately 1%.  The Company also expects full fiscal year EBITDA losses in the NOOK segment to decline versus the prior year.
 
Discontinued Operations
As a result of the College spin-off, historical College results have been adjusted to include separation related costs, including investment banking fees of $7 million, and exclude corporate allocations with Retail and have been classified as discontinued operations.  Quarterly information is provided at the end of this release.
 
Conference Call
A conference call with Barnes & Noble, Inc.’s senior management will be webcast beginning at 5:00 P.M. ET on Thursday, December 3, 2015, and is accessible at www.barnesandnobleinc.com/webcasts.
 
Barnes & Noble, Inc. will report holiday sales on or about January 7, 2016.

Financial Tables
Download financial tables related to the sales and earnings for the fiscal 2016 second quarter ended October 31, 2015:



About Barnes & Noble, Inc.
Barnes & Noble, Inc. (NYSE: BKS) is a Fortune 500 company, the nation’s largest retail bookseller, and a leading retailer of content, digital media and educational products. The Company operates 647 Barnes & Noble bookstores in 50 states, and one of the Web’s premier e-commerce sites, BN.com (www.bn.com). The NOOK Digital business offers a lineup of popular NOOK (www.nook.com) and UK ® tablets and eReaders and an expansive collection of digital reading and entertainment content through the NOOK Store®. The NOOK Store features more than 4 million digital books in the US (www.nook.co.uk), plus periodicals, comics, apps, movies and TV shows, and offers the ability to enjoy content across a wide array of popular devices through Free NOOK Reading Apps™ available for Android™, iOS® and Windows®.
 
General information on Barnes & Noble, Inc. can be obtained by visiting the Company's corporate website at www.barnesandnobleinc.com.
 
Forward-Looking Statements
This press release contains certain forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended) and information relating to Barnes & Noble that are based on the beliefs of the management of Barnes & Noble as well as assumptions made by and information currently available to the management of Barnes & Noble. When used in this communication, the words "anticipate," "believe," "estimate," "expect," "intend," "plan," "will,” “forecasts,” “projections,” and similar expressions, as they relate to Barnes & Noble or the management of Barnes & Noble, identify forward-looking statements.
 
Such statements reflect the current views of Barnes & Noble with respect to future events, the outcome of which is subject to certain risks, including, among others, the general economic environment and consumer spending patterns, decreased consumer demand for Barnes & Noble’s products, low growth or declining sales and net income due to various factors, including store closings, higher-than-anticipated or increasing costs, including with respect to store closings, relocation, occupancy (including in connection with lease renewals) and labor costs, the effects of competition, the risk of insufficient access to financing to implement future business initiatives, risks associated with data privacy and information security, risks associated with Barnes & Noble’s supply chain, including possible delays and disruptions and increases in shipping rates, various risks associated with the digital business, including the possible loss of customers, declines in digital content sales, risks and costs associated with ongoing efforts to rationalize the digital business and the digital business not being able to perform its obligations under the Samsung commercial agreement and the consequences thereof, the risk that financial and operational forecasts and projections are not achieved, the performance of Barnes & Noble’s online and other initiatives, effects on Barnes & Noble and its remaining businesses resulting from the separation of Barnes & Noble Education, unanticipated adverse litigation results or effects, potential infringement of Barnes & Noble’s intellectual property by third parties or by Barnes & Noble of the intellectual property of third parties, risks associated with the SEC investigation disclosed in the quarterly report on Form 10-Q for the fiscal quarter ended October 26, 2013, and other factors, including those factors discussed in detail in Item 1A, “Risk Factors,” in Barnes & Noble’s Annual Report on Form 10-K for the fiscal year ended May 2, 2015, and in Barnes & Noble’s other filings made hereafter from time to time with the SEC.
 
Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results or outcomes may vary materially from those described as anticipated, believed, estimated, expected, intended or planned. Subsequent written and oral forward-looking statements attributable to Barnes & Noble or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements in this paragraph. Barnes & Noble undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this communication.