Borders Group Inc. says it will take a one-time, fourth-quarter write-down of $21 million to $24 million on its so-far profitless Borders.com.
Borders Group Inc. says it will take a one-time, fourth-quarter write-down of from $21 million to $24 million on its so-far profitless Borders.com. "We recognize that the current direct to consumer web business will not produce profits for many years," says Greg Josefowicz, Borders Group CEO. The write-down, which primarily covers hardware and software investment in Borders.com as well as a limited amount of assets at the company`s Waldenbooks unit, signals that Borders won`t be making continued investments in Borders.com, although the web site will continue as a sales channel and the company also will continue to support its Title Sleuth and other electronically-based special order functions. The company will look for other ways to reduce operating costs of its online business as well as focus on cost containment groupwide, according to Josefowicz. Borders Group will release final fourth quarter results in March, but projects consolidated earnings of from $1.22 to $1.24 per share, excluding the write-down and additional charges associated with the previously-announced discontinuation of its All Wound Up toy stores.