Hastings Entertainment reported net income of $660,000, or six cents per diluted share, on sales of $103.9 million, for the fiscal quarter ended July 31. The results are down from the $1.87 million in net income, or 17 cents per diluted share the company reported in the first quarter of 2007, when sales stood at $104.3 million.

Hastings attributed the profit downturn to a $300,000 tax benefit in its second fiscal quarters last year as opposed to paying $438,000 in the quarter just ended. Also, selling, general and administrative expenses increased by more than $1 million to $44.3 million, while gross profit increased by only about $250,000. That latter shortfall was due to the company lowering the prices of used product.

For the six month period ending July 31, Hastings reported $3.6 million in net income, or 35 cents per diluted share, on sales of $212.2 million. That compares with $4.4 million, or 40 cents per diluted share, on sales of $209.3 million.

During the fiscal second quarter comparable-store sales increased by 0.6%, and for the six month period that ratio showed a 2.3% increase. Within the quarter, music sales were down 11.7% and books were down 1.1% on a comparable store basis for the fiscal second quarter. All other product categories showed a healthy increase led by the 25.7% increase turned in from electronics down to the 2.6% comp-store increase generated by movies.

Hastings closed down 46 cents at $7.99 based on the news of its performance.