-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JFPA5JJQuYf23muQM+139LO2n0LEBdyLTcpyZ1e9rbhdaloqzKOmSEi/qan6Y7Ah wSxMJYW3eFsf1s44C1ljsA== 0001157523-03-005994.txt : 20031029 0001157523-03-005994.hdr.sgml : 20031029 20031029132355 ACCESSION NUMBER: 0001157523-03-005994 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20031028 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20031029 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BARNESANDNOBLE COM INC CENTRAL INDEX KEY: 0001069665 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL- COMPUTER & PRERECORDED TAPE STORES [5735] IRS NUMBER: 134048787 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-26063 FILM NUMBER: 03962982 BUSINESS ADDRESS: STREET 1: 76 NINTH AVE STREET 2: 11TH FL CITY: NEW YORK STATE: NY ZIP: 10011 BUSINESS PHONE: 2124146000 MAIL ADDRESS: STREET 1: 76 NINTH AVE STREET 2: 11TH FL CITY: NEW YORK STATE: NY ZIP: 10011 8-K 1 a4504543.txt BARNESANDNOBLE.COM 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): October 28, 2003 ---------------- barnesandnoble.com inc. ----------------------- (Exact name of Registrant as Specified in its Charter) Delaware -------- (State or other Jurisdiction of Incorporation) 0-26063 13-4048787 ------------------------ --------------------------------- (Commission File Number) (IRS Employer Identification No.) 76 Ninth Avenue, New York, NY 10011 - -------------------------------------- --------------------------------- (Address of Principal Executive Offices) (Zip Code) Registrant's Telephone Number, Including Area Code (212) 414-6000 -------------- ---------------------------------------- (Former Name or Former Address, if Changed Since Last Report ) ------------------------------------- Item 7. Financial Statements, Pro Forma Financial Information and Exhibits (c) Exhibits 99.1 Press release of barnesandnoble.com inc., dated October 28, 2003 Item 12. Results of Operations and Financial Condition On October 28, 2003, barnesandnoble.com inc. (the "Company") issued a press release announcing its financial results for the fiscal quarter ended September 30, 2003. A copy of this press release is attached hereto as Exhibit 99.1. The information in this Form 8-K and the Exhibit attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. Use of Non-GAAP Financial Information To supplement the Company's consolidated financial statements presented in accordance with generally accepted accounting principles ("GAAP"), the Company uses non-GAAP measures of EBITDA (defined by the Company as net loss before interest, taxes, depreciation and amortization) for the 13 and 39 weeks ended September 30, 2003 and September 30, 2002. The Company's management reviews these non-GAAP measures internally to evaluate the Company's performance and manage its operations. In addition, since the Company has historically provided non-GAAP results and guidance to the investment community, the Company believes that the inclusion of non-GAAP financial measures provides consistent and comparable measures to help investors understand the Company's current and future operating results. The non-GAAP measures included in the press release attached hereto as Exhibit 99.1 have been reconciled to the comparable GAAP measure as required under SEC rules regarding the use of non-GAAP financial measures. The Company urges investors to carefully review the GAAP financial information included as part of the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and quarterly earnings releases. SIGNATURE --------- Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. barnesandnoble.com inc. (Registrant) By: /s/ Kevin M. Frain -------------------------------- Name: Kevin M. Frain Title: Chief Financial Officer Date: October 29, 2003 EX-99 3 a4504543ex991.txt EXHIBIT 99.1 Exhibit 99.1 Barnes & Noble.com Reports Third Quarter 2003 Results; Third Quarter EBITDA Loss Improves 36 Percent NEW YORK--(BUSINESS WIRE)--Oct. 28, 2003--Barnes & Noble.com (Nasdaq:BNBN) (www.bn.com) announced today that the company's net sales for third quarter 2003 were $99.0 million, within the previous estimates of $97 million to $102 million. The company's third quarter gross margin improved to 24.6 percent from 24.0 percent in the third quarter of 2002 as a result of an increase in the company's internal fulfillment rate as well as the change in the model for used and out-of-print books, which results in higher gross margins and lower reported sales. During third quarter 2003, the company reduced its total operating expenses on both a dollar basis and as a percentage of net sales as it continued to realize greater efficiencies across its operations. Total operating expenses decreased 13.8 percent quarter over quarter and improved as a percentage of net sales to 36.9 percent in the third quarter of 2003 from 41.3 percent in the third quarter of 2002. The company's EBITDA loss (loss before interest, taxes, depreciation and amortization) for the third quarter improved 36.1 percent to ($6.0) million from ($9.3) million in the third quarter of 2002.(1) The net loss for the third quarter was ($12.2) million, or ($0.08) per share, which was at the low end of the company's forecast for an EPS loss of ($0.08) to ($0.10) per share. The third quarter 2003 results represent a 30.4 percent improvement from a net loss of ($17.5) million or ($0.11) per share for the third quarter of 2002. "We are well-positioned for a strong holiday season," said Marie Toulantis, chief executive officer of Barnes & Noble.com. "We have exciting merchandising and marketing programs planned for this holiday, and we remain focused on EBITDA profitability for the fourth quarter 2003 by continuing to build on the strong operational efficiencies realized throughout the year." Full Year Full year 2003 sales are expected to be in the range of $415 million to $435 million. Full year net loss per share remains unchanged: the full year 2003 net loss per share is expected to be between ($0.28) to ($0.32). About Barnes & Noble.com Barnes & Noble.com is a leading Internet-based retailer of books, music, DVD/video and online courses. Since opening its online store (www.bn.com) in March 1997, Barnes & Noble.com has attracted more than 15.8 million customers in 230 countries. Barnes & Noble.com's bookstore includes the largest in-stock selection of in-print book titles with access to approximately one million titles for immediate delivery, supplemented by more than 30 million listings from its nationwide network of out-of-print, rare and used book dealers. Barnes & Noble.com offers its customers fast delivery, easy and secure ordering, and rich editorial content. SAFE HARBOR This release may contain forward-looking statements regarding expectations of the company. These statements are based on the beliefs of the management of the company as well as assumptions made by and information currently available to the management of the company. Such statements reflect the current views of the company with respect to future events, the outcome of which is subject to certain risks, including among others general economic and market conditions, changes in product demand, the growth rate of Internet usage and e-commerce, possible disruptions in the company's computer or telephone systems, possible increases in shipping rates or interruptions in shipping service, effects of competition, the level and volatility of interest rates, the performance of the company's new product initiatives, the successful integration of acquired businesses, unanticipated adverse litigation results or effects, product shortages, changes in tax and other governmental rules and regulations applicable to the company and other factors, risks and uncertainties more specifically set forth in the company's public filings with the Securities and Exchange Commission. The forward-looking statements herein speak only as of the date of this release. The company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement included in this release to reflect any changes in the company's expectations or any changes in events, conditions, or circumstances on which any such statement is based. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results or outcomes may vary materially from those described herein. (1) The third quarter 2003 EBITDA loss of ($5.97) million consisted of a net loss of ($12.16) million before interest income of $0.02 million and depreciation and amortization of ($6.21) million. The third quarter 2002 EBITDA loss of ($9.33) million consisted of a net loss of ($17.46) million before interest income of $0.30 million and depreciation and amortization of ($8.43) million. The company's management considers EBITDA to be an important measure in evaluating the company's financial performance and uses this measure in managing ongoing operations. -- Two tables to follow-- barnesandnoble.com inc. Consolidated Statements of Operations (thousands of dollars, except per share data) (unaudited) Three months ended Nine months ended ------------------- ------------------- September September September September 30, 30, 30, 30, 2003 2002 2003 2002 -------- -------- -------- -------- Net sales 98,993 102,575 291,433 294,947 Cost of sales 74,688 77,997 219,915 227,034 -------- -------- -------- -------- Gross profit 24,305 24,578 71,518 67,913 -------- -------- -------- -------- Operating expenses: Fulfillment and customer service 8,457 8,240 25,413 26,237 Marketing, sales and editorial 7,187 8,682 22,945 26,731 Technology and web site development 8,056 8,190 23,168 27,022 General and administrative 6,572 6,998 19,338 19,802 Depreciation and amortization 6,210 8,428 20,322 24,953 Equity in net loss of equity investments including related amortization of intangibles - 1,805 - 3,179 -------- -------- -------- -------- Total operating expenses 36,482 42,343 111,186 127,924 Operating loss (12,177) (17,765) (39,668) (60,011) Interest income, net 22 303 186 1,395 -------- -------- -------- -------- Net loss $(12,155) $(17,462) $(39,482) $(58,616) -------- -------- -------- -------- Basic net loss per common share ($0.08) ($0.11) ($0.25) ($0.37) Average shares (diluted if converted) (1) 159,385 158,788 159,035 158,788 barnesandnoble.com inc. Consolidated Statements of Operations (continued) (thousands of dollars, except per share data) (unaudited) Three months ended Nine months ended ------------------- ------------------- September September September September 30, 30, 30, 30, 2003 2002 2003 2002 --------- --------- --------- --------- Percent of net sales: Gross margin 24.6% 24.0% 24.5% 23.0% Operating expenses: Fulfillment and customer service 8.5 8.0 8.7 8.9 Marketing, sales and editorial 7.3 8.5 7.9 9.1 Technology and web site development 8.1 8.0 7.9 9.2 General and administrative 6.6 6.8 6.6 6.7 Depreciation and amortization 6.3 8.2 7.0 8.5 Equity in net loss of equity investments including related amortization of intangibles - 1.8 - 1.1 --------- --------- --------- --------- Total operating expenses 36.9 41.3 38.2 43.4 Operating loss (12.3) (17.3) (13.6) (20.4) Interest income, net 0.0 0.3 0.1 0.5 --------- --------- --------- --------- Net loss (12.3)% (17.0)% (13.5)% (19.9)% --------- --------- --------- --------- (1) Includes the conversion of outstanding membership units of barnesandnoble.com llc converted into outstanding shares of barnesandnoble.com inc. barnesandnoble.com inc. Consolidated Balance Sheets (thousands of dollars, except share and per share data) September 30, December 31, 2003 2002 ------------- ------------ (unaudited) ASSETS Current assets: Cash and cash equivalents $ 37,959 $ 70,144 Receivables, net 5,524 14,631 Merchandise inventories 47,993 48,303 Prepaid expenses and other current assets 4,122 3,991 ----------- --------- Total current assets 95,598 137,069 ----------- --------- Fixed assets, net 46,395 58,871 Goodwill, net 13,777 13,777 Other non-current assets 20 17 ----------- --------- Total assets $ 155,790 $ 209,734 =========== ========= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 12,536 $ 16,071 Accrued liabilities 54,871 70,456 Payable to affiliate 51,715 48,261 ----------- --------- Total current liabilities 119,122 134,788 ----------- --------- Minority interest 22,706 52,305 ----------- --------- Commitments and contingencies Stockholders' equity: Preferred Stock: $0.001 par value; 50,000,000 shares authorized; none issued and outstanding - - Common Stock Series A: $0.001 par value; 750,000,000 shares authorized; 44,594,993 and 43,802,228 shares issued and outstanding 44 44 Common Stock Series B: $0.001 par value; 1,000 shares authorized; 1 share issued and outstanding - - Common Stock Series C: $0.001 par value; 1,000 shares authorized; 1 share issued and outstanding - - Paid-in capital 190,555 189,294 Accumulated deficit (176,637) (166,697) ----------- --------- Total stockholders' equity 13,962 22,641 ----------- --------- Total liabilities and stockholders' equity $ 155,790 $ 209,734 =========== ========= CONTACT: Barnes & Noble.com Carolyn Brown, 212-633-4062 cbrown@bn.com or Kevin Frain, 212-414-6093 kfrain@book.com -----END PRIVACY-ENHANCED MESSAGE-----