Citing "particular strength in the book category," Borders Group reported that total sales for the October 27 through January 11 period rose 7%, to $1.2 billion. Sales at superstores increased 8.4%, to $733.7 million, with same-store sales ahead 2%. Waldenbooks had a 2.7% decline in sales in the period, to $313 million, due to store closures and a 0.2% dip in comparable-store sales. Total sales in Borders's international segment rose 28.2%.

Borders CEO Greg Josefowicz said that in addition to books, where bestsellers sold exceptionally well, the gift card, DVD and gift and stationery categories also had solid holiday performances. The music segment was once again a soft spot for Borders during the holiday season.

Based on holiday sales that were at the high end of its estimates, Borders said it was revising slightly upward its estimated earnings for the full fourth quarter. The company also noted that it expects comparable-store sales for the complete quarter to remain at current levels in all its business segments.

While Josefowicz said Borders was satisfied that it had met its holiday goals, the company's superstores performed below Barnes & Noble's superstores, which earlier this month reported a 6% increase in comp-store sales. Same-store sales at Books-A-Million were up 3.9%

In labor news, employees at Borders's flagship store in Ann Arbor, Mich., who had been on strike since November 8, voted to accept a new contract January 8, making it the first and only unionized Borders store with a contract. The vote was 20-12. As part of the deal, Borders agreed to include Ann Arbor in the first group of 40 stores to benefit from an hourly wage increase of 25 cents that will roll out companywide starting in April. (At the Ann Arbor store, cashiers start at $6.50 per hour and booksellers start at $7.)

The agreement also includes a number of changes from the standard employment agreement Borders maintains with all employees. Among the differences is the stipulation that all current and new hourly employees stay in or join the union. Employees will forgo a $30-per-month merchandise credit in exchange for an 11-cent hourly raise, and laid-off employees are guaranteed a week's notice. In addition, the two sides agreed to put a grievance procedure in place, and a labor management committee will meet twice a year.

Anne Roman, Borders's spokesperson, issued a statement: "We believe this contract reflects our commitment to fairness, consistency and staying competitive and are pleased to have reached a successful conclusion to negotiations."

Employees at Borders's only other unionized store, in Minneapolis, Minn., continue to negotiate for a contract. Negotiations began in 2002; employees rejected contract proposals in September 2003 and at the beginning of December 2003. The union is evaluating the latest proposal from the company; talks between the two groups are expected to resume soon.