Trans World Entertainment posted $18 million in net income, or 57 cents per diluted share, on sales of $458.6 million, in its fiscal fourth quarter that ended Jan. 28. These results were down from $34

Trans World Entertainment posted $18 million in net income, or 57 cents per diluted share, on sales of $458.6 million, in its fiscal fourth quarter that ended Jan. 28. These results were down from $34.7 million, or 98 cents per diluted share that the Albany, N.Y.-based company generated in the corresponding period of the prior fiscal year, when sales were $513.5 million.

Trans World blamed the downturn on general weakness in music and DVD. Also, the company said sales dropped 11% due to an 8% decline in comparable stores and due to the fact that the company’s quarterly average store count of 791 was 40 fewer outlets than the average number of stores in operation during the prior corresponding period.

In a conference call with Wall Street analysts, Trans World chairman and CEO said that on a comparable-store basis video games were down 3%; video down 2%; and music sales declined 14%.

Additionally, the chain’s Top 50 CDs, which represent 16% of the company’s music sales, were down 35% for the quarter.

The company produced a gross margin of 33% for the quarter, down from 34.8% same quarter last year, while selling, general, and administrative expenses comprised 23.3% of sales, up from 22% same quarter last year. Trans World executive VP/CFO John Sullivan said that while the expense rate was up, absolute expenditures were actually down $6.4 million.

The weak fourth quarter results pushed Trans World into the red for the year, with the company showing a net loss of $1.4 million, or 4 cents per diluted share, on sales of $1.24 billion. That compares with the $41.8 million, or $1.15 per diluted share, the company generated in its prior fiscal year when sales totaled $1.34 billion.

The losses in both the quarterly and full year results included a 7 cents per share charge for a change in account principle.

For the year, the company said comparable-store sales declined 5.7%. By store sector, mall stores were down 5.4% while freestanding store sales decreased 6.3%.
Looking ahead, the company said it expects a net loss of 25 cents to 30 cents a share this quarter, and a 6%-7% decline of comparable stores sales.

The earnings were announced before the start of trading, and the company finished the day down 3 cents at $5.83 per share.