Trans World Entertainment Corp. May 29 reported a first-quarter (ended May 5) loss of $8.1 million, which was 56% higher than the $5.2 million loss reported in the previous-year period. Revenue dropped nearly 5% to $96.6 million.
The company cited much of the loss on continued challenges in its f.y.e. (For Your Entertainment) mall-based home entertainment retail chain.
Revenue at one of the country’s last entertainment retail chains dropped nearly 17% to $54 million from $65 million during the previous period.
Comparable f.y.e. store sales declined 8.5%, as a comp increase of 2.8% in lifestyle and electronics categories was offset by a 16.8% decline in video, music and video games. The lifestyle and electronics categories represented 49.5% of revenue for the first quarter as compared to 42.6% in the same period last year.
The chain recorded an operating loss of $5.4 million, compared to an operating loss of $4.4 million for same period last year.
f.y.e. operated 253 stores – mostly mall-based – in the period compared to 273 stores last year. With malls under siege from e-commerce, f.y.e. faces a duel threat from changing consumer consumption of video entertainment and shopping habits.
“Although in the midst of continued structural and external challenges [at f.y.e.], we are focused on efforts to differentiate our entertainment merchandise towards creating a unique specialty retailing experience of choice for families and fans of popular culture and fun,” CEO Mike Feurer said in a statement.
Indeed, Feurer preferred to highlight the company’s overall fiscal health, in addition to etailz.com, the company’s ecommerce subsidiary selling merchandise on Amazon. Revenue increased 15% to $42.5 million, while operating loss increased to $2.8 million from $821,000 last year.
“As we work through the assortment changes needed to stabilize the f.y.e. business, we have maintained focus on the balance sheet, ending the quarter with $15 million and no debt,” Feurer said.