Indigo Books and Music, Canada's leading book retailer, has delivered another quarter of declining sales. The company reported a total comparable sales decline of 8% for the second quarter of its current 2020 fiscal year compared to a year ago, a figure that covers both physical and online sales. Overall Sales declined 7.6% in the first quarter of this year compared to the previous year.
Revenue for the second quarter, ending September 28, 2019, was C$203.4 million, down from C$216.3 million during the same period last year, a decrease of C$12.9 million. Overall, Indigo reported a net loss of C$20.5 million, compared to a net loss of C$19.1 million for the same quarter last year. Online sales in particular were down, falling 12.2% for the period.
Indigo blamed the decline in sales on "strong competitive pressures" and "a strategic reduction in promotional campaigns," part of an effort to cut some C$20 million to C$25 million in expenses for the year, of which it claims to have already cut C$9 million. The company continues to spend money renovating stores, and had a one-time expense in moving a New York office back to Toronto. One positive sign for the company was a reported improvement of C$0.4 million in adjusted EBITDA for the quarter on a lower sales base.
Commenting on the results, Indigo CEO Heather Reisman said: "As we continue to navigate our strategic shift, we are seeing promising early results on key performance measures."
As for new projects, the company recently introduced a pay-to-play rewards program, Plum Plus, which offers customers free shipping, instant discounts, special events loyalty points. It costs C$39 a year to participate. Indigo is also working to revamp its merchandising efforts, and Indigo CFO Craig Loudon said on the company's investor call that while it won't be until the middle of next year that they anticipate to see strong results from the efforts, the company nevertheless "feels good about holiday" sales potential.
