Borders Reports US$300 Million Loss in Fiscal 2010
posted on by Gia Manry
The retail book chain Borders lost US$300 million over its fiscal 2010 year, which ended on January 29, 2011, and it has continued to lose money since filing for bankruptcy on February 16. In its first month of the fiscal 2011 year (January 30 to February 26), Borders lost US$28.3 million; that loss was only slightly lower in the first full month after the bankruptcy filing: US$24.3 million.
The Publishers Weekly industry news source attributes some of these difficulties to publishers' unwillingness to work with Borders "on anything close to normal business terms," forcing the chain to pay for stock in cash rather than credit. ICv2 calls regaining credit from publishers is the chain's "most formidable task," although the company claimed in its report that its forecasts indicate that Borders has the cash it will need to carry it through the end of its fiscal 2011.
Borders delayed payments to publishers this past January, and delayed more in February, prior to its bankruptcy filing. Publishers then became weary of dealing with Borders, and Diamond Comics Distributors' Diamond Books distribution arm, which handles graphic novel distribution in bookstores for manga publishers Bandai Entertainment, Dark Horse Comics, Digital Manga Publishing, Udon Entertainment, and Yaoi Press, put all Borders orders on hold.