Waterstones’ major losses posted in its financial results have received widespread coverage in the national press, with most focussing on m.d. James Daunt’s turnaround plans and current positive sales trend.
The Bookseller first reported Waterstones had made an operating loss of £25.4—increasing to £37.3m after tax—in the year to April 2012 as like-for-like sales had decreased by 11.1%, on Monday (4th February). Then, m.d. James Daunt told The Bookseller: "In a sense [the results] is so much what I inherited. Half the year was with them [HMV]. I don't know if you remember what kind of state it was in when I arrived—it was truly shocking."
The Telegraph reported yesterday (5th February) that Waterstones saw a like-for-like Christmas sales increase of 5% as Daunt’s turnaround plans come into fruition.
He called the results a “torrid” set but said the company had turned a corner over the last nine months, refurbishing its “dark” and “dank” shops to entice more customers. He added that after Russian billionaire Alexander Mamut bought Waterstones, the company faced an uphill struggle to fix problems such as restrictions on buying stock and supplier confidence. He told the newspaper that while 2013 results would have improved significantly the company was still likely to post a loss.
Retail Week has reported that Daunt insisted he would not “chase [market] share” at the expense of margins while he was in charge of the business.
He said: “We’re not chasing market share but we’re managing ourselves in a dramatically more efficient way.” He also reiterated the “shocking state” the business was in when he took charge of it after it was bought from the HMV Group, while adding that the company was down to a rate of 10% returns from 20-25% when Daunt took over.
He also said that there were no plans to overhaul Waterstones’ digital operation to compete more with Amazon. “In two years I doubt we’ll have a substantially bigger online offer; we have a competitor who already does that very well,” he said. “I want a business that generates cash, it’s got to be sustainable.”
Waterstones' results were also covered by the Daily Mail’s This is Money, the London Evening Standard and City AM.