Dive Brief:

• Barnes & Noble, Inc. on Thursday said that fourth quarter total sales fell 4.3% to $786 million from $821.2 million last year, and full-year sales fell 6% to $3.7 billion. Comparable store sales declined 4.1% for the fourth quarter and 5.4% for the full year, according to a company press release. The results topped the quarterly FactSet estimates cited by Marketwatch for $775 million in sales and a 4.9% comp decline.

• The consolidated fourth quarter net loss widened to $21.1 million or 29 cents per share, (missing the FactSet forecast for a 20-cent decline), from a loss of $13.4 million or 19 cents per share in the prior year, the company said. The fiscal 2018 consolidated net loss was $125.5 million or $1.73 per share, compared to net earnings of $22 million or 30 cents per share in the prior year.

• For fiscal year 2019, the bookseller expects consolidated earnings before interest, taxes, depreciation and amortization to range between $175 million and $200 million, according to the release. Profit improvements will come largely from cost reductions, CEO Demos Parneros said on a conference call Thursday.

Dive Insight:

Barnes & Noble shares slid Thursday morning as Parneros sought to assure investors that new leadership and a turnaround strategy were poised to right the ship this fiscal year.

Among them is Timothy Mantel, former GNC merchandising chief, appointed earlier this year as the company's new Chief Merchandising Officer. The company is improving its curation, righting the assortment, reviewing its real estate, slicing costs and increasing its omnichannel services, including ship from store, Parneros said in a conference call Thursday morning, calling its turnaround strategy "aggressive." The company's physical footprint this year will be "net store positive," and as leases come up for renewal some stores will get smaller, he said, noting that 14,000 square feet has emerged as the ideal target size. The first of those smaller stores will debut this fall, he said.

In February, Parneros said the company was working to return to its roots as a bookseller, abandoning a short-lived emphasis on super-trendy music and coloring books that had only briefly yielded some strong sales. That led to declines in the gift, music and DVD categories, which accounted for nearly half of the retailer's holiday quarter same-store sales decrease, and music and DVD sales continue to suffer, he said Thursday.

But he also said Thursday that, while stores will shrink the space dedicated to those items "as quickly as we can," the company is re-imagining its gift business and is boosting its offer for toys, games and gifts, which have provided healthy sales and will be marketed at the holidays and events like Mother's Day. The company is also promoting supplies like pens and backpacks, which complement its new summer book club program.

The company is learning a lot from its stores with restaurants, a new effort where display and discovery are presented differently than in other stores, he also said.

Barnes & Noble has undergone a series of executive shake-ups, including electing four CEO's in as many years, with Parneros arriving last summer. Before his appointment the company was planning an elevated restaurant concept for four of its stores, an effort launched under CEO Ronald Boire, who left the position in 2016 after less than a year. Also last year, activist hedge fund Sandell Asset Management announced it had taken a "meaningful" stake in Barnes & Noble and urged the book retailer to sell itself or go private in a letter. 

It was a different story on Wall Street for the company's old education division, spun off in 2015, which soared past expectations for its quarter, on Wednesday reporting a third quarter consolidated sales increase of 15.7% to $603.4 million.