Hastings Entertainment posted net income of $1.9 million, or 17 cents per diluted share, on sales of $125.9 million in the company’s second fiscal quarter ended July 31.
The profit total represents slightly more than a 10-fold increase from the $179,000 in net income reported in the corresponding period in the prior year.
The 153-store company said that it increased gross profit to 36.2% up from 35.3% in the same period last year, while reducing expenses to 34.4% from 34.8%. “Our merchandising and buying teams have produced greater margin rates for the second consecutive quarter,” Hastings Entertainment chairman and CEO John Marmaduke said.
Hastings also reported a 2.2% comparable-store gain for the second quarter. In looking at comparable store gains by product line, music was down 14.2% but all other product categories enjoyed gains, including movies, up 10.6%, books, up 6.9%, video games, up 14%, electronics, up 23.3%, trend merchandise, up 18.9%, consumables, up 5.5%, and cafe, up 9.4%.
For the six-month period, the company produced $4.4 million, or 39 cents per diluted share, on revenues of $209.4 million.
“We are confident in our ability to grow earnings for the remainder of the year, said Hastings Entertainment VP and CFO Dan Crow. “However, we continue to be concerned about general economic conditions, which could have negative measurable impact on retail sales.”
The Amarillo, Texas-based company also increased its earning guidance to 68 cents per diluted share from 63 cents to reflect the favorable impact of the settlement of a prior year’s state tax liability.
