Barnes & Noble Education(US:BNED)2026-01-20 13:17Financial Performance - Barnes & Noble Education, Inc. reported total BNC First Day sales of $114.4 million for the 13 weeks ended August 2, 2025, representing a 40.5% increase compared to $81.4 million for the same period in the previous year[162]. - Total sales for the 13 weeks ended August 2, 2025, increased by 9.4% to $288.2 million, driven by growth in BNC First Day programs[185]. - Gross Comparable Store Sales rose by $34.6 million, or 13.0%, during the quarter, primarily due to a $33.0 million increase in revenues from BNC First Day programs, which grew by 40.5%[185]. - Product sales and other for the quarter were $274.2 million, up 9.3% from $250.9 million in the same period last year[186]. - Course material product sales increased by $26.2 million, or 19.9%, to $157.6 million during the 13 weeks ended August 2, 2025, driven by higher comparable store sales and new store sales[190]. - The cost of sales for the quarter was $232.8 million, resulting in a gross profit of $55.4 million, compared to $45.0 million in the prior year[184]. - Gross margin increased by $10.4 million, or 23.1%, to $55.4 million, representing 19.2% of sales during the 13 weeks ended August 2, 2025, compared to 17.1% in the prior year[195]. - The net loss for the quarter improved by $85.6 million, or 82.4%, to $(18.3) million compared to $(103.9) million in the prior year[185]. - Adjusted EBITDA improved by $11.4 million, or 49.8%, to $(11.5) million from $(22.9) million last year, mainly due to increased sales from BNC First Day programs[185]. - Total operating loss decreased to $23.2 million during the 13 weeks ended August 2, 2025, from an operating loss of $38.7 million in the prior year[203]. - Adjusted Net Income (Loss) was $(15.8) million during the 13 weeks ended August 2, 2025, compared to $(101.2) million in the prior year[208]. - Adjusted Free Cash Flow for the 13 weeks ended August 2, 2025, was $(74,451) thousand, compared to $(152,398) thousand for the same period in 2024, indicating better cash management[216]. - Net cash flows used in operating activities decreased to $(67,603) thousand for the 13 weeks ended August 2, 2025, from $(143,502) thousand in the prior year, a reduction of $75,899 thousand[222]. Financing and Liquidity - The company completed various financing transactions on June 10, 2024, raising gross proceeds of $95.0 million, which included a $50.0 million private investment and a $45.0 million rights offering[165]. - The refinancing of the credit facility provided access to a $325.0 million facility maturing in 2028, enhancing financial flexibility and reducing annual interest expenses[166]. - The company raised $95.0 million in gross equity proceeds through a private investment and a fully backstopped rights offering, enhancing liquidity[229]. - The company's revolving credit facility had a maximum borrowing capacity of $325 million, with $170 million outstanding as of August 2, 2025[228]. - Interest expense decreased by $3.9 million to $3.7 million during the 13 weeks ended August 2, 2025, primarily due to lower borrowing and interest rates[205]. - Cash flows provided by financing activities were $65.0 million for the 13 weeks ended August 2, 2025, down from $139.9 million in the prior year, primarily due to higher equity financing in 2025[226]. Operational Strategy - The company is focusing on expanding its BNC First Day affordable access course material programs, which have reversed historical revenue declines in course materials at participating institutions[161]. - The company streamlined its operations into a single operating segment following a realignment to better reflect organizational management, combining previous Retail and Wholesale segments[170]. - The business is highly seasonal, with the majority of textbook sales occurring in the second and third fiscal quarters, impacting overall revenue and operating profit[171]. - The company aims to improve cash flow timing by aligning cash outflows to vendors with cash inflows from schools adopting BNC First Day programs[173]. - The company has implemented cost-saving initiatives, including workforce reductions and closing under-performing stores, to maximize productivity and profitability[169]. - The company continues to focus on expanding its BNC First Day programs to enhance market share and improve profitability[177]. - The company is focused on aligning cash outflows to course material vendors with cash inflows from collections from schools as sales shift to BNC First Day affordable access course material offerings[217]. Store Operations - The number of physical stores at the end of the period was 657, with 39 stores opened and 42 closed during the 13 weeks ended August 2, 2025[189]. - No common stock was repurchased under the stock repurchase program during the 13 weeks ended August 2, 2025[236]. - Approximately $26.7 million remains available under the stock repurchase program as of August 2, 2025[236]. - A total of 429 shares were repurchased outside of the stock repurchase program for employee tax withholding obligations[236]. - Selling and administrative expenses were $67.9 million, slightly up from $67.0 million in the previous year[184]. - Selling and administrative expenses increased by $0.9 million, or 1.3%, to $67.9 million during the 13 weeks ended August 2, 2025[198]. Stock and Shareholder Information - A reverse stock split was completed on June 11, 2024, reducing the number of outstanding shares from approximately 2.62 billion to about 26.2 million[232][233].