Barnes and Noble 2001 Annual Report Download - page 13

The following table sets forth, for the periods indicated, the percentage relationship that certain items bear to total sales
of the Company:
Fiscal Year 2001 2000 1999
Sales 100.0 % 100.0 % 100.0 %
Cost of sales and occupancy 73 .1 72.4 71.2
Gross margin 26.9 27.6 28.8
Selling and administrative expenses 18.6 18.6 1 8 .7
Legal settlement expense 0. 1 -- --
Depreciation and amortization 3.0 3.3 3.2
Pre-opening expenses 0.2 0.2 0.2
Impairment charge -- 2.4 --
Operating margin 5 . 0 3 .1 6.7
Interest expense, net and amortization of deferred financing fees ( 0.8) ( 1 . 2 ) ( 0. 7 )
Equity in net loss of Barnes & Noble.com ( 1.8 ) ( 2.4) ( 1. 2 )
Gain on formation of Barnes & Noble.com -- -- 0.7
Other income (expense) ( 0.2 ) ( 0 . 2 ) 0.8
Earnings (loss) before provision for income taxes and cumulative
effect of a change in accounting principle 2.2 ( 0.7 ) 6.3
Provision for income taxes 0.9 0.4 2.6
Earnings (loss) before cumulative effect of a change
in accounting principle 1.3 ( 1 . 1 ) 3 .7
Cumulative effect of a change in accounting principle -- -- ( 0.1 )
Net earnings (loss) 1.3 % ( 1 . 1 )% 3.6 %
( 1 ) In fiscal 2000, the Company acquired a controlling intere s t
in Calendar Club L.L.C. (Calendar Club) by increasing its
p e rcentage ownership interest to a p p roximately 74 perc e n t .
A c c o rd i n g l y, the Company has consolidated the results of
operations of Calendar Club. Included in fiscal 2001 are
sales and operating profits associated with Calendar Club
of $68,157 and $3,009, re s p e c t i v e l y. Included in fiscal
2000 are sales and operating profits of $66,301 and
$1,395, re s p e c t i v e l y. Prior to fiscal 2000, the Company’s
consolidated statement of operations included its equity in
the results of operations of Calendar Club as a component
of other income (expense). The Company’s equity in the net
e a rnings of Calendar Club for fiscal 1999 was $1,228.
(2) Fiscal 2001 operating profit is net of legal and settlement
expenses of $4,500. Fiscal 2000 operating profit is net of
a non-cash impairment charge of $106,833.
( 3 ) Comparable store sales for Barnes & Noble stores are
determined using stores open at least 15 months, due to
the high sales volume associated with grand openings.
Comparable store sales for B. Dalton stores are determ i n e d
using stores open at least 12 months. Comparable store
sales for the GameStop stores include sales of stores that
have been open for 12 months.
(4) Includes FuncoLand stores acquired in June 2000.
M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S O F
F I N A N C I A L C O N D I T I O N A N D R E S U L T S O F O P E R A T I O N S c o n t i n u e d
2 0 0 1 A n n u a l R e p o r t ■B a r n e s & N o b l e , I n c .
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