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

Investor Contacts:
Joseph J. Lombardi
Chief Financial Officer
Barnes & Noble, Inc.
(212) 633-3215
jlombardi@bn.com

Andy Milevoj
Director of Investor Relations
Barnes & Noble, Inc.
(212) 633-3489
amilevoj@bn.com

02/23/2010

Barnes & Noble Reports Fiscal 2010 Third Quarter Financial Results

Barnes & Noble.com Sales Increase 32%; Declares Quarterly Dividend of $0.25

New York, NY (February 23, 2010)—Barnes & Noble, Inc. (NYSE: BKS), the world’s largest bookseller, today reported sales and earnings for its fiscal 2010 third quarter ended January 30, 2010.  The company also announced that its Board of Directors has declared a quarterly cash dividend of $0.25 per share payable on March 31, 2010, to stockholders of record on March 10, 2010.

Total sales for the third quarter were $2.2 billion, a 33% increase compared to the prior year.  Barnes & Noble store sales decreased 4.7% to $1.4 billion, with comparable store sales decreasing 5.5% for the quarter.  Total sales in the 2010 quarter include Barnes & Noble College Bookstore (“College”) sales of $566 million.  For the 2010 quarter, College’s comparable store sales decreased 1.3% but were down only 0.2% for the five week “back-to-school rush” period ending February 6, 2010. 

Barnes & Noble.com sales increased 32% to $210 million for the quarter, as compared to the prior year.  Most notably, Barnes & Noble.com’s sales accelerated throughout the quarter, increasing 67% year-over-year for the month of January.  

“nook(TM) began shipping only in the middle of the third quarter, and, as evident in our sales, we are thrilled with how customers have embraced our product and our digital eBook platform,” said Steve Riggio, chief executive officer of Barnes & Noble, Inc.  “In addition to the accelerating online sales trends, nook(TM) sales have been strong at our bookstores since the product became available earlier this month.”

For the third quarter, the company reported earnings before interest, taxes, depreciation and amortization (EBITDA) of $204 million.  The company’s third quarter earnings incorporate the first full quarter of College’s financial results since acquisition.  College contributed $49 million to EBITDA during the quarter.   Consolidated net earnings were $80.2 million, or $1.38 per share, at the high end of the guidance range of $1.20 to $1.40 per share. 

The company ended the third quarter with $40 million in cash and no debt outstanding under its revolving credit facility.

Bestselling titles during the quarter included John Grisham’s Ford Country, Greg Mortenson’s Stones into School, Elizabeth Gilbert’s Committed, Andre Agassi’s Open and Nicholas Sparks’ Last Song.

GUIDANCE
For the fiscal 2010 fourth quarter ending May 1, 2010, comparable store sales at Barnes & Noble stores are expected to decline 2% to 4%, and College’s comparable store sales are expected to be in a range of (1%) to 1%.  The company expects full-year comparable store sales at Barnes & Noble stores to decline 3% to 5% and continues to expect College’s comparable store sales to be in a range of (1%) to 1% from the acquisition date to the end of fiscal 2010.

The fourth quarter loss per share is expected to be in a range of $0.85 to $1.15.  Consistent with the update provided on January 7, 2010, fiscal year 2010 earnings per share is expected to be in a range of $0.23 to $0.53.
 
As of January 30, 2010, the company operated 719 Barnes & Noble stores and 639 Barnes & Noble College Bookstores.  During the third quarter, three Barnes & Noble stores were opened and nine were closed; three College stores were opened.  Additionally, the company closed 46 B. Dalton bookstores.

CONFERENCE CALL
A conference call with Barnes & Noble, Inc.’s senior management will be webcast beginning at 10:00 A.M. ET on Tuesday, February 23, 2010, and is accessible at www.barnesandnobleinc.com/webcasts

Barnes & Noble, Inc. will report full year earnings results for the 2010 fiscal year ending May 1, 2010, on or about June 24, 2010.

FINANCIAL TABLES
Download financial tables related to the sales and earnings for the third quarter ended January 30, 2010:

Consolidated Statements of Operations (14 KB)
Consolidated Balance Sheets (14 KB)

To read the tables, you will need Adobe Reader, available at no charge from Adobe. Click here to download Adobe Reader, and follow the step-by-step instructions.



About Barnes & Noble, Inc.

Barnes & Noble, Inc. (NYSE: BKS), the world's largest bookseller and a Fortune 500 company, operates 723 bookstores in 50 states.  Barnes & Noble College Booksellers, LLC, a wholly-owned subsidiary of Barnes & Noble, also operates 639 college bookstores serving nearly 4 million students and over 250,000 faculty members at colleges and universities across the United States.  Barnes & Noble is the nation's top bookseller brand for the seventh year in a row, as determined by a combination of the brand's performance on familiarity, quality, and purchase intent; the top bookseller in quality for the third year in a row and the number two retailer in trust for the second year in a row, according to the EquiTrend® Brand Study by Harris Interactive®. Barnes & Noble conducts its online business through Barnes & Noble.com (www.bn.com), one of the Web’s largest e-commerce sites, which also features hundreds of thousands of titles in its eBookstore (www.bn.com/ebooks).  Customers can buy and read eBooks on a wide range of platforms, including nook(TM) by Barnes & Noble, the iPhone and iPod touch, BlackBerry® smartphones, as well as most Windows® and Mac® laptops or full-sized desktop computers.
 
General information on Barnes & Noble, Inc. can be obtained via the Internet by visiting the company’s corporate website: www.barnesandnobleinc.com

nook(TM) is a trademark of Barnes & Noble, Inc.

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SAFE HARBOR

This press release contains “forward-looking statements.”  Barnes & Noble is including this statement for the express purpose of availing itself of the protections of the safe harbor provided by the Private Securities Litigation Reform Act of 1995 with respect to all such forward-looking statements. These forward-looking statements are based on currently available information and represent the beliefs of the management of the company.  These statements are subject to risks and uncertainties that could cause actual results to differ materially.  These risks include, but are not limited to, general economic and market conditions, decreased consumer demand for the company’s products, possible disruptions in the company’s computer systems, telephone systems or supply chain, possible risks associated with data privacy and information security, possible work stoppages or increases in labor costs, possible increases in shipping rates or interruptions in shipping service, effects of competition, possible disruptions or delays in the opening of new stores or the inability to obtain suitable sites for new stores, higher than anticipated store closing or relocation costs, higher interest rates, the performance of the company’s online, digital and other initiatives, the performance and successful integration of acquired businesses, the success of the company’s strategic investments, unanticipated increases in merchandise, component or occupancy costs, unanticipated adverse litigation results or effects, the results or effects of any governmental review of the company’s stock option practices, product and component shortages, and other factors which may be outside of the company’s control.   Please refer to the company’s annual, quarterly and periodic reports on file with the SEC for a more detailed discussion of these and other risks that could cause results to differ materially.  The company assumes no obligation to update or revise any forward-looking statements.