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GameStop Reports Sales And Earnings For Fiscal 2011

Stocks in this article: GME

GameStop Corp. (NYSE: GME), the world’s largest multichannel video game retailer, today reported sales and earnings for the fourth quarter and fiscal year ended Jan. 28, 2012.

Fourth Quarter Results

Total global sales for the fourth quarter of 2011 were $3.58 billion compared to $3.69 billion in the prior year quarter, a decrease of 3.0%. Consolidated comparable store sales decreased 3.6% compared to the prior year quarter.

Excluding restructuring, impairment and debt retirement expenses, GameStop’s adjusted net earnings for the fourth quarter were $239.5 million compared to adjusted net earnings of $238.8 million in the prior year quarter. Adjusted diluted earnings per share, excluding restructuring, impairment and debt retirement expenses, were in-line with guidance at $1.73, a 10% increase compared to adjusted diluted earnings per share of $1.57 in the prior year quarter.

During the fourth quarter of fiscal 2011, the company recorded asset impairment and restructuring charges of $81.2 million ($64.6 million, net of tax benefits), or $0.47 per share, to record international trade name impairment, exit certain international markets and non-core businesses, and close underperforming stores. The charges included fixed asset impairments, severance costs and lease termination fees. A reconciliation of non-GAAP adjusted net income to GAAP net income is included with this release (Schedule III).

For the fourth quarter, GameStop’s net earnings were $174.7 million compared to net earnings of $237.8 million in the prior year quarter. Diluted earnings per share were $1.27 compared to diluted earnings per share of $1.56 in the prior year quarter.

Fiscal 2011 Results

Paul Raines, chief executive officer, stated, “In 2011, GameStop outperformed the video game market through disciplined execution of its core business and strategic initiatives. For 2012, we project operating earnings growth based on the continuation of our transformation, led by our strong pre-owned business, expanding digital offerings and emerging mobile categories.”

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