BORDERS GROUP PRE-ANNOUNCES Q1 RESULTS
ANN ARBOR, Mich., May 4 /PRNewswire/ -- Borders Group, Inc. (NYSE: BGP)
pre-announced first quarter earnings today at a meeting with investors
and provided an update on Borders.com, Borders e-commerce site.
For the first quarter of 1998, Borders Group, Inc. expects to report
diluted earnings per share of $0.05 compared to break-even diluted
earnings per share of $0.00 in the first quarter of 1997. This marks
the Company's sixth consecutive quarterly profit and highlights the
increasing earnings momentum of the core business and in particular
Borders' superstores. Management attributed the improvement over last
year's performance to continued gross margin improvement and expense
control which was offset by strategic spending on Borders.com,
international operations and other strategic initiatives.
Consolidated sales for the quarter were $545.4 million, a 17.6%
increase over the prior year sales of $463.6 million. Borders sales
increased to $335.0, a 27.1% increase over last year sales of $263.5
million. The sales increase at Borders reflects an increase in the
number of stores during the preceding 12 months from 163 to 206. On a
comparable store basis, Borders sales increased 4.5% compared to last
year's very strong comparable store increase of 9.5% for a two year
total comparable sales increase of 14.0%. Sales for the first two
months of the quarter were slightly above expectations with a softening
in April which was attributable to unseasonably warm weather in the
northeast and midwest regions of the country. Waldenbooks reported
sales of $191.7 million, a 2.8% decline from prior year sales of $197.3
million. Sales results at Waldenbooks reflects a comparable store
sales decrease of 0.9% and a reduction in stores from 930 to 903 over
the prior 12 months.
Detail regarding first quarter earnings will be released and discussed
on the May 13th conference call.
The Company also announced that it will launch Borders.com during the
week of May 4th. Details regarding the site will be covered in a
separate press release at launch.
Safe Harbor Statement
Certain of the statements set forth above, including expected 1998
first quarter earnings per share, are forward looking statements within
the meaning of the Securities Exchange Act of 1934. Such statements
are based upon management's estimates, assumptions and projections and
are subject to risks and uncertainties that could cause actual results
to differ materially from those set forth in the forward looking
statements. Factors that could cause actual results to differ
materially from those in the forward looking statements include, among
other things, consumer demand for the Company's products, which is
believed to be related to overall consumer spending patterns and, with
respect to the mall business, overall mall traffic; an unexpected
increase in competition; higher than anticipated interest, occupancy,
labor, distribution and inventory shrinkage costs; unanticipated work
stoppages; higher than anticipated costs associated with the closing of
underperforming stores; unanticipated increases in the cost of the
merchandise sold by the Company; the performance of the Company's new
strategic initiatives, including the Internet and international
expansion; the stability and capacity of the Company's information
systems; unanticipated costs or problems relating to the Company's Year
2000 compliance; changes in foreign currency exchange rates; and the
continued ability of the Company to locate and develop suitable sites
for its superstore expansion program.
Borders Group, Inc. is the world's second largest retailer of books,
music, and other informational, educational, and entertainment
products. Borders Group, Inc. includes Borders, Inc., over 200
superstores offering what is widely regarded as the broadest books and
media assortment in the industry; Waldenbooks, the United States'
leading mall book retailer, which operates over 900 stores serving all
50 states; and, Books etc., a leading retailer of books in the United
Kingdom operating 23 stores. Borders Group, Inc. operates in the
United States, the United Kingdom, and Singapore, and trades on the New
York Stock Exchange under the symbol of "BGP".
SOURCE Borders Group, Inc.
-0- 05/04/98 /NOTE TO EDITORS:
Information: For general information, including copies of this or other
reports, please fax or mail your request to the attention of the
Investor Relations Dept.; Fax 734-973-4538; 100 Phoenix Drive; Ann
Arbor, MI 48108-2202. Information can also be obtained via the
Internet by visiting the Borders web sites at borders.com or
via fax by calling Company News On-Call at 800-758-5804, ext. 106169./
/CONTACT: Ken Scheve, Senior Vice President and CFO of Borders,
734-973-4065/
/Company News On-Call: prnewswire.com or fax, 800-758-5804,
ext. 106169/
/Web site: borders.com (BGP)
CO: Borders Group, Inc. ST: Michigan IN: REA SU: ERP |
