Borders Group Profit Slips

The stock is lower a day after the earnings report.
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Bookstore operator

Borders Group

(BGP)

said its fourth-quarter profit declined after being hurt by higher promotional discounts.

The company earned $119.1 million, or $1.78 a share, in the quarter, compared with $122.8 million, or $1.62 a share, a year ago. Adjusted for items, earnings were $1.87 a share in the most recent quarter.

Analysts polled by Thomson First Call were estimating earnings of $1.76 a share.

Fourth-quarter revenue rose 6.4% from a year ago to $1.48 billion. Analysts were expecting revenue of $1.42 billion.

Looking ahead, Borders is projecting a first-quarter loss of 20 cents to 30 cents a share, including charges of 2 cents to 3 cents a share. Analysts were expecting the company to lose 11 cents a share in the first quarter.

For fiscal 2006, the company expects to earn $1.42 to $1.60 a share, including charges of 10 cents to 15 cents a share. Wall Street's consensus estimate is a profit of $1.60.

Sales at domestic Borders superstores rose 9.8% in the fourth quarter to $938.7 million, helped by higher book sales. International segment revenue was up 10% to $203.7 million. Revenue from Waldenbooks fell 4.9% to $312.3 million.

The company reported its results after the market closed Thursday. Shares of Borders were down 87 cents, or 3.5%, to $23.75 Friday.

This story was created through a joint venture between TheStreet.com and IRIS.