BGP has broken out the results of its Internet site. Borders.com had third quarter sales of $4.1 MM and lost $3.9 MM. BNBN had third quarter sales of $49.1 MM and lost $21.9 MM.
news.cnet.com
Borders' Net losses wipe out retail gain
By Bloomberg News
Special to CNET News.com
November 18, 1999, 7:05 p.m. PT
ANN ARBOR, Michigan--Borders Group, the second-largest U.S. bookseller, said its third-quarter loss widened slightly as increased spending for its online sales effort wiped out profit from higher store revenue.
The Ann Arbor, Michigan, company's loss grew to $1.5 million, or 2 cents a share, in the quarter ended Oct. 24, from $800,000, or 1 cent, a year earlier. It was expected to lose 5 cents, the average earnings estimate of analysts polled by First Call. Sales rose 18 percent to $656.3 million from $558.3 million.
Borders has been spending to boost its Borders.com e-commerce site as it meets the challenges of Amazon.com and other online booksellers. Its third-quarter revenue rose on higher sales of children's books, including the popular Harry Potter series and those featuring Pokemon cartoon characters.
Borders is "spending on the Internet and that part of the business is losing money," said Jason Klein, a Blackford Securities analyst, who has a "hold" rating on the shares. "I don't think anyone is getting 'bang for the buck' on their Internet businesses."
Borders.com lost $3.9 million, or 5 cents a share, on sales of $4.1 million. That offset a $2.4 million, or 3 cents a share, profit from its "brick and mortar" stores.
Borders' shares fell .13 to 13.94 on the New York Stock Exchange. The results were released after the close of regular U.S. trading.
The company's stock has fallen 44 percent this year on investor worries about slower sales growth and competition from online booksellers. The Standard & Poor's Mid-cap Index has risen 10 percent during the same period.
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