Borders Has a Tough First Quarter

The Borders Group has reported first quarter results.

Bad news: Sales fell 12.1% to $641.5 million, creating a net loss of $86 million.

Good news: The operating loss for the quarter was only $15.9 million, an improvement over the analysts' estimates of more than $29 million.

Shelf Awareness reports: "because the loss was lower than expected, Borders shares rose 12.8% to $2.90 a share in after-hours trading, according to Reuters."

The number of Borders stores remains flat at 515--they neither opened nor closed any stores during the quarter. Sales at their superstores fell 13.5% while sales at the regular stores fell 10.7%.

Things were very different over at Waldenbooks. Borders closed 11 Waldenbooks locations during the first quarter, 100 over the past year. That leaves 376 stores still open. Total Waldenbook sales fell 19.9% while comparable store sales (those still open in the first quarter) fell 5.5%.

Ron Marshall, Borders CEO, said:

Make no mistake about it, we have much more work to do and will continue to maintain our financial discipline. At the same time, we know that we cannot save our way to prosperity. Our long-term success will come from doing a much better job of driving sales and that's where our focus is right now.