Business Segments

6 Months Ended

Jul. 30, 2011

7. Business Segments

The Company has two reportable operating segments: retail trade and electronic commerce trade. These reportable operating segments reflect the manner in which the business is managed and how the Company allocates resources and assesses performance internally.

Our chief operating decision maker is our Chairman and Chief Executive Officer. The Company is primarily a retailer of book merchandise. The Company’s two reportable operating segments are two distinct business units, one a traditional retailer of book merchandise and the other a seller of book merchandise primarily over the Internet. The electronic commerce trade segment is managed separately due to divergent technology and marketing requirements. The retail trade segment also includes the Company’s distribution center operations, which predominantly supplies merchandise to our retail stores. Through the distribution center operations the Company also sells books to outside parties on a wholesale basis. These sales are not material.

The Company evaluates the performance of the retail trade and electronic commerce trade segments based on profit and loss from operations before interest and income taxes. Certain intersegment cost allocations have been made based upon consolidated and segment revenues. Shipping income related to Internet sales is included in net sales, and shipping expense is included in cost of sales.

Both the retail trade and electronic commerce trade reportable operating segments derive revenues primarily from the sale of book merchandise through sales in our retail stores and over the Internet, respectively.


	Thirteen Weeks Ended						Twenty-Six Weeks Ended
Segment Information (in thousands)	July 30, 2011			July 31, 2010			July 30, 2011			July 31, 2010
Net Sales
Retail Trade	$	102,789		$	119,091		$	204,067		$	235,176
Electronic Commerce Trade		6,310			5,076			12,626			10,717
Intersegment Sales Elimination		(2,713	)		(4,119	)		(6,294	)		(8,877	)

Net Sales	$	106,386		$	120,048		$	210,399		$	237,016

Operating (Loss) Income
Retail Trade	$	(3,292	)	$	3,502		$	(8,253	)	$	7,285
Electronic Commerce Trade		(70	)		(67	)		(239	)		(182	)
Intersegment Elimination of Certain Costs		192			(254	)		391			(528	)

Total Operating (Loss) Income	$	(3,170	)	$	3,181		$	(8,101	)	$	6,575


	July 30, 2011		January 29, 2011
Assets
Retail Trade	$	259,873	$	273,074
Electronic Commerce Trade		3,780		1,728

Total Assets	$	263,653	$	274,802

For the thirteen and twenty-six week periods ended July 30, 2011 and July 31, 2010, respectively, sales by merchandise category, as a percentage of net sales were as follows:


	Thirteen Weeks Ended						Twenty-Six Weeks Ended
	July 30, 2011			July 31, 2010			July 30, 2011			July 31, 2010
Books and Magazines		75.6	%		80.4	%		75.8	%		80.3	%
General Merchandise		9.7	%		8.9	%		9.7	%		8.8	%
Café		4.8	%		4.0	%		4.7	%		4.2	%
Other		9.9	%		6.7	%		9.8	%		6.7	%

Total		100	%		100	%		100	%		100	%

General merchandise consists of gifts, cards, collectibles and similar types of products. Café consists of coffee, tea and other edible products, as well as gift items related to our Joe Muggs cafés. Other products include music, DVDs, E-Books and other products.